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Alliant Credit Union's Savings and Checking Rate Scheduled to Drop in January

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Alliant Credit Union

After a reader emailed me the news, I called and confirmed it. Alliant Credit Union's board of directors has approved deep rate cuts for January on the savings account and High Rate Checking. The savings account yield will fall to 1.15% APY and the High Rate Checking yield will fall to 1.10% APY. Both are currently at 1.35% APY.

Alliant Credit Union's savings account has been a rate leader for the last three years. So it's worrisome to see this drop. Alliant may not be alone on rate cuts in January. With the Quantitative Easing and new regulations, banks and credit unions may find it necessary to cut deposit rates yet again.

It should be noted that Alliant Credit Union's savings account rate will remain above the rates of the savings accounts at ING Direct and Ally Bank. I did a graph comparing the savings account rates between Alliant and Ally for the past 3 years (includes the time when Ally was GMAC Bank). As you can see in the graph, Alliant Credit Union's rates have never been below Ally's rates. Note, before October 2008 the graph compares GMAC Bank's money market account yield with Alliant's savings account yield. GMAC didn't have a savings account back then. In September 2008 GMAC introduced the savings account which had a higher rate than the money market account. In the graph I switched from the MMA to the savings account in October 2008. That's the reason for the Ally rate hike. There were only two times that Ally and Alliant had the same rates (January 2009 and July 2009). All other times, Alliant's rates have been higher.

Alliant Credit Union vs Ally Bank Savings Accounts

For the full details of Alliant's rate history, please refer to the bottom of the post of my Alliant Savings Account review.

Alliant Credit Union's CD and IRA CD rates continue to be very competitive. They haven't changed since October. Unlike the savings and checking account rates which always change at the start of a month, Alliant's CD rates can change at any time during the month. For more details about Alliant's CDs and credit union membership, please refer to my October review of Alliant Credit Union and its CDs.

  Tags: Alliant Credit Union, savings account

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Comments
9 comments.
Comment #1 by Anonymous posted on
Anonymous
Thank you for the head up. Just opened a couple of CD in ACU in case that their CD rates will drop as well.

4
Comment #2 by Anonymous posted on
Anonymous
It's just getting worse and worse for savers... the effective inflation rate is about 8.5% including food and gas right now. Basically they want you to spend your money, or put in stock market to make the Wall Street make more money while you don't know if you are going to make money or loose a lot of money (like what happened in 2008) while it' in stock market. On TVs they keep saying that American people are not saving enough, but on the other hand they make every effort to make saving money much less attractive.

7
Comment #3 by mrvirgo posted on
mrvirgo
This new rate reduces the use of my Alliant accounts (savings and checking) to a very fast hub. I have all my liquid cash in a local rewards checking account that's at 3.25% as of December. Even if my rewards checking account falls to 2% in the future,  it's still better than what is being offered by most banking institutions. And you can't beat Alliant for service and honesty. My CDs with Alliant are at 3%.So I'm in a win-win situation.

3
Comment #4 by best deals in cancun (anonymous) posted on
best deals in cancun
Thanks for publishing such a informative content. I was looking for such type posts. Please keep it up on regular base i would like to view your posts on regular base.....BEST WISHES

1
Comment #5 by cactus posted on
cactus
They are playing games:

- Now they are starting to drift the checking interest rate below the savings rate -- undercutting their original implied promise that the rates would be the same.

- You don't get interest on the checking if you just transfer funds from their savings to the checking. You must deposit new money every month. Not a big deal, but another cute gimmick.

Now I get it... the CEO was at Chase Bank for 25 years. We will see more games from Alliant Credit Union.

1
Comment #6 by beethovengirl (anonymous) posted on
beethovengirl
When did Alliant ever promise the rate on checking and savings would be the same?  When they first introduced the High Rate Checking account, the rate was 0.25 percentage points lower than the savings account rate:

http://www.depositaccounts.com/blog/2009/01/alliant-credit-unions-free-high-rate.html

The news is disappointing, but Alliant will remain my primary checking account.

2
Comment #7 by cactus posted on
cactus
Thank you for the info. When I heard about it a few months ago, the rate was the same for savings and checking. That is what attracted me and I'm sure many others. The implication was that you didn't have to pay any attention to the difference between savings to checking rates.

1
Comment #8 by Anonymous posted on
Anonymous
I concede the necessity, in order to qualify an Alliant checking account for payment of interest, of a monthly electronic transfer of funds into the account from outside the credit union.  This is a requirement, along with signing up for e-statements.

I pre-scheduled, one time only, a five dollar transfer each month into my Alliant checking via an ACH pull.  It's not anything I ever have thought of as even remotely burdensome.  And it's great to earn interest on checking.

2
Comment #9 by Anonymous posted on
Anonymous
I just got a matured CD and now Alliant is no longer near the top beginning in January. It's getting very crowded as nearly everyone is approaching 0%.

1