Best Bank Account Interest Rates - Summary for January 15, 2011

Comments (5)
Jan 15, 2011 - 5:00 PM by Ken Tumin

Economic news this week continues to show a sluggish recovery. December retail sales were below expectations and there was a decline in a consumer confidence index. On the positive side, J.P. Morgan Chase reported fourth-quarter profits that were better than expected. With such big profits, you have to wonder why Chase is saying that regulations are forcing them to raise fees. Much of the strong profits came from improvements in the consumer lending environment. Higher loan demand should encourage banks to offer some better deposit rates although I wouldn't expect too much especially from the mega banks.

The signs of a sluggish recovery was also seen in the December Core CPI which excludes food and energy. It was up by only 0.1%. For 2010, it was up by only 0.8% which was the smallest December-December increase in the history of the index. This will likely give the Fed justification to continue with QE2 and its ultra-low interest rate policy. The chance that we'll see a Fed rate hike by December has gone down according to the Fed funds future. The futures are showing the implied probability of a higher Fed funds rate by next December at 48.4% which is down from last Saturday when it was 55.3%.

Savings Account Rates

A week after SmartyPig slashed its rate, another rate leader took a plunge this week. Southern Community Bank & Trust's internet bank, Ready Saver, slashed its savings account yield from 1.35% to 0.90%. I first reported on this savings account in February 2010 when the yield was 2.00%. The rates have held up well until this week. As you can see in my Wednesday post, Ready Saver isn't the first internet bank to disappoint.

Several of the rate leaders on my list are small banks like Morrill and James Bank, AmericaNet, Evantage, SFGI Direct and Incredible Bank. Just below these are some larger banks that have been offering competitive rates for a while. These include Capital One, American Express and Sallie Mae Bank. One might think these larger banks will be more likely to keep their internet savings accounts competitive over the long term. But as we saw with ETrade Bank and OnBank, a large bank doesn't guarantee competitive rates.

Rate Hikes:

  1. None

Rate Cuts:

  1. Reader Saver Savings - 0.90% (was 1.35%)
  2. HSBC Advance Savings - 0.90% (was 1.00%)

Certificate of Deposit Rates

Some of the CD rate leaders cut rates this week. These included CNB Bank Direct and America's Credit Union. Most of the CD rate leaders continue to be credit unions like Fort Knox FCU, Connexus Credit Union and Melrose Credit Union.

Two banks that you don't usually see on my rate lists were high ranking this week. Salem Five continues to offer its special 2.75% APY 5-year CD and 1.35% APY 14-month CD. It also started offering a special 1.75% APY 2-year CD this week. Salem Five now shares the top 2-year CD spot with Fort Knox FCU.

The other new bank on the list is Kaiser Federal which came out with a 5-year CD special with a 2.75% APY.

Reward Checking Accounts

As I mentioned in the first week of January, there are only two banks with nationally available reward checking accounts with yields of 3% for balances up to $25K. If you want a higher rate, you'll have to look within your state. Many of the best reward checking accounts are only available in small areas of the country. However, there are a few with yields of at least 4.00% for up to $25K in more populated areas. I reviewed some of these in this Friday post. If you know of others that I missed, please leave a comment. One reader noted 1st Commonwealth Bank of Virginia which offers a 4% reward checking account that's available in the DC metro area.

To find reward checking accounts available nationwide or to find those that are only available in your state, please refer to the reward checking section of DepositAccounts.com.

Recap for the Week - Links to This Week's Posts

Banking News/Resources

Savings/Checking Accounts - Nationwide

CD Deals - National

Checking/Savings Bonuses

Reward Checking Accounts

CD and Money Market Deals - Local

The rates listed below are based on Annual Percentage Yield (APY). No minimum balances are required unless noted. MMA next to the rates indicate a money market account. Most MMAs have check writing and ATM cards. Online savings accounts usually lack both of these. Previous weekly summaries are available at this page. Quick Links: Refer to the following links for the savings accounts and CDs that interest you: Liquid Account Rates: Savings Accounts, Reward Checking, Bank alternatives CD Rates: 3 Mo CDs, 6 Mo CDs, 9 Mo CDs, 12 Mo CDs, 18 Mo CDs, 24 Mo CDs, 36 Mo CDs, 48 Mo CDs, 60 Mo CDs, 84 Mo CDs, CDs by state.

Rates as of January 15, 2011

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

3-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

6-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

9-Month Certificates of Deposit:

  • Noteworthy Accounts - Local Only

12-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

18-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

24-Month Certificates of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

36-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

48-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

60-Month Certificate of Deposit:

  • Noteworthy Accounts Available Nationwide:
  • Noteworthy Accounts - Local Only

84-Month Certificate of Deposit:

  • Noteworthy Accounts - Local Only

Various Deposit Account Deals

Bank Account Alternatives

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)


Post a CommentComments
In order of date posted. - Sort by votes
Anonymous

Anonymous - #1, Saturday, January 15, 2011 - 5:43 PM

Once I saw that the megabanks are making a lot of money and deposit rates were remaining laughably low, I decided to take a different approach.  Rather than renew my Chase CD, I used the proceeds to buy into a large cap banks mutual fund. I figured if they're going to make a lot of money, I may as well try to ride along.  In 3 months, its up nearly 25%. 


6
Hank

Hank (anonymous) - #2, Saturday, January 15, 2011 - 10:30 PM

Sombody wrote nice responce to CEO of Alliant Credit Union in this blog:

http://www.depositaccounts.com/blog/2011/01/internet-savings-accounts-that-became-duds.html#43543

I agree with his observations.


3
Bozo

Bozo (anonymous) - #3, Sunday, January 16, 2011 - 6:46 AM

To: Anon #1:

Nice hedge. But remember, 25% in three months annualizes to 100%/year, so you might want to book some green. As they say, never let green fade to red. That having been said, your experience illustrates why folks should never be automatically married to one investment strategy or asset class. As they also say, you can't fight the Fed.

As an aside, might I suggest folks go to Vanguard's website (the home page) for a candid assessment by one of their managers regarding interest rates (which he expects to rise) and bond funds (whose principal value he expects to go down). Reading between the lines, a well-laddered bucket of CDs should out-perform a garden-variety bond fund for the foreseeable future, even with long-term CDs currently around 3% or a smidge less. Reason: it matters not that the average coupon might be over 4% (TLT is 4.37) if the principal value declines by more than the coupons (dividends).

Hope that makes everybody with laddered CDs feel a bit better. It should.

Bozo


5
Anonymous

Anonymous - #4, Sunday, January 16, 2011 - 10:48 AM

I think most of us believe interest rates are going to go up.  The big unknown is when, how much, and how fast.  No, it won't happen overnight, but ??? 

As for me and my personal circumstances, a CD ladder is my main source of income and financial security.  It has suited me rather well ever since I had retired several years ago even though the interest income has declined recently. I am still quite confident and comfortable with this approach. 


2
Financial Forecasting Process

Financial Forecasting Process (anonymous) - #5, Sunday, January 16, 2011 - 11:52 PM

This weeks economy was surprising the interest rates surprised me

http://www.supercfo.com/forecasting_and_sensitivity_analysis.php


1

Add Your Comment


Post a Comment

Featured Accounts
Related Posts
Best Bank Account Interest Rates - Summary for Week Ending May 26, 2012Best Bank Account Interest Rates - Summary for Week Ending May 26, 2012
Best Bank Account Interest Rates - Summary for Week Ending May 19, 2012Best Bank Account Interest Rates - Summary for Week Ending May 19, 2012
Survey of the Best CD Rates for May 18, 2012Survey of the Best CD Rates for May 18, 2012
Best Bank Account Interest Rates - Summary for Week Ending May 12, 2012Best Bank Account Interest Rates - Summary for Week Ending May 12, 2012
Best Bank Account Interest Rates - Summary for Week Ending May 5, 2012Best Bank Account Interest Rates - Summary for Week Ending May 5, 2012
Best Bank Account Interest Rates - Summary for Week Ending April 28, 2012Best Bank Account Interest Rates - Summary for Week Ending April 28, 2012
Best Bank Account Interest Rates - Summary for Week Ending April 21, 2012Best Bank Account Interest Rates - Summary for Week Ending April 21, 2012
Best Bank Account Interest Rates - Summary for Week Ending April 15, 2012Best Bank Account Interest Rates - Summary for Week Ending April 15, 2012
Useful Resources
Nationwide Savings Accounts