It has been a while since my last report on Wilshire State Bank's Rainbow Savings Account. The rates dropped last November, but they've held since then which makes them a good deal. The Rainbow Savings Account is an installment savings account in which you make equal monthly deposits during the term rather than one initial deposit like a CD. However, like a CD the rate is fixed during the term.
The current rates as listed at Wilshire State Bank's Rainbow Savings page as of 5/06/2010 are shown below. These rates assume you have automatic transfer from a Wilshire State Bank deposit account.
- 3.82% APY 36 months
- 3.30% APY 30 months
- 3.30% APY 24 months
- 3.05% APY 18 months
- 3.05% APY 12 months
If you want to compare the above rates to CDs with comparable maturities, it requires that you consider the rate you receive on the savings or checking account that holds the initial lump sum. The monthly deposits would come from this account. By the time the installment savings account matures, all of the principal of the savings or checking account has been transferred to the installment savings account. So about half of the money earns the savings/checking account rate for the term, and about half earns the installment savings rate. So you can estimate the equivalent CD yield by averaging the two rates. Here are the equivalent CD yields of the Wilshire Rainbow Savings Account assuming you also have Wilshire's eLink Savings account with a 1.25% APY that will last through the term.
Estimated CD Equivalent Yields
- 2.54% APY 36 month
- 2.28% APY 30 months
- 2.28% APY 24 months
- 2.15% APY 18 months
- 2.15% APY 12 months
Maximum contract amount is $100,000 per customer. There's an online application for this Rainbow account, and I've been told by the CSR that it's available nationwide.
I have more details about opening this account in my April 2009 review of Wilshire State Bank. Additional useful details are available in this Fatwallet thread. One reader reported in November of problems with the online application. Hopefully, it works better now. If you've recently given it a try, please leave a comment.
You can also open the Rainbow Savings account at a Wilshire State Branch. Branches are located in Southern California, New York, New Jersey, and Dallas and Forth Worth, Texas.
The bank's ratings for safety and soundness continue to be above average: 4 stars (excellent) at BauerFinancial and 3 stars (performing) at Bankrate.com. Both ratings are based on 12/31/09 data. The bank has been a FDIC member since 1980 (FDIC Certificate # 23301).