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Survey of the Best Local CD Rates for July 8, 2011

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CD rates held up well since last Friday. The only noteworthy CD rate cut was at Ally Bank which again cut its 5-year CD rate. It's now 2.33% APY which is down from 2.34%. The rate fell by only one basis point, but these cuts have been adding up over the last month. Ally's 4-year Raise Your Rate CD still has a 1.99% APY. If you're worried about relying on early withdrawals if interest rates shoot up, the 4-year Raise Your Rate CD is an alternative. The rate is only 34 basis points less, and it gives you two options during the 4-year term to increase the rate to the new 4-year CD rate.

The worry about being able to make an early withdrawal if interest rates shoot up is also a concern with a new long-term CD deal that came out this week. iGObanking.com started offering a 3.10% APY 7-year CD and a 3.50% APY 10-year CD (available nationwide). The early withdrawal penalty is only 6 months of interest which is low for CDs with terms over 5 years. However, as I pointed out in my iGObanking.com CD review, their disclosure gives them the right to refuse an early withdrawal.

As some readers pointed out in my iGObanking.com CD review, no one knows how long this low-interest rate environment will last. Long-term CDs may do well if rates stay low. That's one of the advantages of CD ladders in which you regularly reinvest long-term CDs into new long-term CDs. It provides some protection for both rates staying low and for rising rates.

For the local CD rates, there haven't been many changes since last week. I did add a few long-term CDs with terms over 5 years. One is a 6-year CD at NVE Bank in New Jersey which has a 3.10% APY. I did a review of this CD and bank on Tuesday.

The other new long-term CDs that I added are from San Antonio FCU (SACU) and Randolph-Brooks FCU. SACU is noteworthy for its 10-year CD which has a 4.09% APY for a $90K minimum deposit. This is the highest CD rate in the nation. Unfortunately, it's primarily limited to those in San Antonio. Randolph-Brooks FCU is also based in San Antonio, but its field of membership is a little broader and includes parts of Austin. Its highest rate is 3.45% APY for a 7-year CD with a $75K minimum deposit.

Unfortunately, 3.00%+ CDs have become rare even for terms over 5 years. I wish I could find more of these especially for places like California, Florida and Arizona.

For those who prefer short-term CDs, State Bank of India (California) continues to offer its special 1.50% APY 15-month CD. I just noticed on its website that this special is scheduled to end on July 31. This bank has branches in several major California cities including Los Angeles, San Diego, Bakersfield, San Jose and Fremont. There's also a branch in Washington DC.

Best Nationwide CD Rates

So you can see how the local rates compare, I'm including a few of the best CD rates that are available nationwide. These are often from credit unions which anyone can join via an association. I'm also including more than one CD for each category. For example, Connexus Credit Union has 3 best CD rates, but these require an active checking account. Since many don't want to worry about maintaining another checking account, I'm including another CD without any checking requirement. And I'm including Ally Bank's 5-year CD for many of the short-term CDs. As I described many times, this can be a better deal than short-term CDs due to the 60-day early withdrawal penalty. I've included a link to a discussion of this strategy that describes the potential risks.

Using the Rate Tables to Find the Best Local CD Rates

As I described in my rate table overview, you can use our CD rate tables to find the best local CD rates. One thing that complicates looking for local rates is that it can be hard to know the areas served by small banks and credit unions. So in my list below, I primarily focus on banks and credit unions that serve large regions or large metro areas. My criteria is that they offer rates higher than the nationwide equivalent CD. If the rate is high enough, I'll also mention a bank or credit union even if it's not in a large populated area. These aren't hard rules. They're just general rules to keep the list manageable and useful.

Yields Accurate as of 7/08/2011

Under 1-Year CD Rates

  • Noteworthy Local Deals

1-Year CD Rates

  • Noteworthy Local Deals

18-month CD Rates

  • Noteworthy Local Deals

2-Year CD Rates

  • Noteworthy Local Deals

3-Year CD Rates

  • Noteworthy Local Deals

4-Year CD Rates

  • Noteworthy Local Deals

5-Year CD Rates

  • Noteworthy Local Deals

Over 5-Year CD Rates

  • Noteworthy Local Deals

Note: All rates listed above are Annual Percentage Yields (APY) which factor in compounding.


  Tags: CD rates

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Comments
Comment #1 by Anonymous posted on
Anonymous
True, CD rates are depressing, especially considering underlying inflation rates and the taxability of interest income in non-retirement vehicle accounts.  That said, it never hurts to ask for a higher rate than is posted, especially at smaller institutions.  Perhaps oddly, the smaller or less commonly recognized name institutions are at least occasionally willing to negotiate a higher interest rate, especially if you bring in new money. 

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