Best Bank Account Interest Rates - Summary for Week Ending October 22, 2011

There were signs this week that the Fed is in the planning stages for more stimulus. The possibility of more Fed action was described in this week's WSJ articles Fed Is Poised for More Easing and Fed Official Hints at Possible Effort to Boost Economy. However, in a meeting with Democrat Senators, Bernanke told them "that they should not expect additional monetary stimulus from the Fed". There have been signs this month of modest improvements in the economy. If the positive economic trends continue and if Europe resolves its debt issues, perhaps we are nearing a bottom for interest rates.

The concerns over Europe seemed to offset the mild good news on the economy causing Treasury yields to change little from last week. The yield summary below shows the changes (Numbers are based on Yahoo bond rate data and the CME Group FedWatch.)

Treasury Yields:

• 6-month: 0.04% same as last week
• 2--year: 0.26% same as last week
• 5--year: 1.06% down from 1.11% last week
• 10-year: 2.21% down from 2.25% last week
• 30-year: 3.26% up from 3.23% last week

Fed funds futures' implied probability for a higher rate by:

• Dec 2012: 11.9% up from 8.7% last week
• Mar 2013: 18.4% up from 15.9% last week

The Labor Department released September CPI numbers this week. The report showed that we have seen more inflation in the last year than we have in the last 3 years. One bit of good news from this higher inflation is that it creates a good deal for new Series I Savings Bonds that are purchased in October. As I described in my I Bond post, you can get a yield of almost 3.28% for up to 14 months if you buy an I Bond before November. The downside is that you are limited to a total of $10K in I Bond purchases per year and per social security number.

Savings & Checking Account Rates

Two of the big internet banks cut their savings account rates this week. The first was Ally Bank which should not have been a surprise since it has been slowly cutting rates almost every week. Its savings and money market account rates fell from 0.91% to 0.85%. The rate cut at the other big internet bank was more of a surprise. ING Direct cut its Orange Savings Account yield from 1.00% to 0.90%. The 1.00% yield had held since February.

The other cuts came from the internet divisions of New York Community Bank. Its two internet divisions, AmTrustDirect and MyBankingDirect, cut their money market promo yields from 1.25% to 1.15%.

So now UFB Direct's Airline Rewards Savings is way out in front as the rate leader with a 1.30% APY. UFB Direct is Bank of Internet USA's new internet division. I've been told this isn't a promo rate. However, there's no guarantee about how long it'll last. The rate has held since UFB Direct was launched in August.

Reward Checking Accounts

There were no rate cuts this week on my short list of nationally available reward checking accounts. The best deal for a $25K balance continues to be at ABCO Federal Credit Union which offers a 2.52% APY for balances up to $25K (see my review).

If you want higher rates than these, you'll have to look at what's available in your state. There are still some local deals that offer at least 4.00% APY on balances of at least $25K. However, this 4-percent club is getting smaller. Texas Bank left this club when it cut its reward checking APY from 4.07% to 3.04%. The total number in this club now stands at 10. These 10 banks and credit unions are located in parts of Texas, Oklahoma, Missouri, Louisiana, Illinois, Iowa, Ohio and Pennsylvania.

Most of these local deals are only available in the market areas of the banks and credit unions. These can be small areas. However, there are a few that are available online to residents of one or more states. This week I reviewed some of the best of these deals in this post.

To see the reward checking account rates available in your state, please refer to the reward checking rate table. If you're new to these tables, my rate table guide should be useful, and if you're new to reward checking, my blog post, 10 Common Traits of High-Yield Reward Checking, should also be useful.

Rate Hikes:

1. None

Rate Cuts:

1. AmTrustDirect Premium e-MMA - 1.15% [was 1.25%]
2. MyBankingDirect MMA - 1.15% [was 1.25%]
3. ING Direct Orange Savings - 0.90% [was 1.00%]
4. Ally Bank Savings/MMA - 0.85% [was 0.91%]
5. DollarSavingsDirect - 0.70% [was 0.75%]

Certificate of Deposit Rates

My recap of CD rate changes and the list of CD deals will now be in my Friday survey of the best CD rates. My Saturday recaps will now focus on banking news of the week and liquid accounts.

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

Banking News/Resources

• Another 4 Banks Closed by Regulars - Yearly Total at 84
• Next I Bond Inflation Component Makes I Bonds Better than CDs
• Has Online Banking Kept You at Your Bank?
• Book Review: The Creature from Jekyll Island

Savings/Checking Accounts - Nationwide

• EverBank Offers Checking Account Promo to Win Over Megabank Customers

CD Deals - National

• Survey of the Best CD Rates for October 21, 2011
• Internet CD Specials with Top Rates at Atlantic Coast Bank
• CIT Bank Launches Internet CDs with Unique Features & Top Rates

Checking/Savings/CC Bonuses

• Bonus and Free Checking at Co-Op Services Credit Union in Michigan - Local Only
• Checking Bonus & Other Deals at First Trade Union Savings

Reward Checking Accounts

• Top Free Reward Checking Accounts with Statewide Availability

CD and Money Market Deals - Local

• Top 5-Year CD & IRA CD Rate at Visions FCU in New York State - Local Only
• Competitive Short-Term CD Rates at Biscayne Bank in Florida - Local Only
• Competitive 2-Year CD Rate at International Bank of Chicago - Local Only
• Competitive CD Rates at Columbus Metro Credit Union in Ohio - Local Only

Posts from Previous Weeks

• Archive of 2011 Posts

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.

Rates as of October 22, 2011

Checking/Savings/Money Market Accounts:

• Best Savings Account Rates (Nationwide & by State)
• Best Money Market Rates (Nationwide & by State)
• Best Checking Account Rates (Nationwide & by State)

• How to View Rates for Your State

• Noteworthy Accounts Available Nationwide:

• UFB Direct (Bank of Internet) - 1.30% Savings account review
• AmTrustDirect - 1.15% (min $10K) promo rate
• MyBankingDirect - 1.15% (min $5K) promo rate
• Incredible Bank - 1.18% MMA ($2.5K min) account review
• Alliant Credit Union - 1.15% (min $100) account review
• SFGI Direct - 1.11% (not accepting new accounts) account review
• SmartyPig - 1.10% (min $25, max $50K) withdrawal restrictions, account review
• ING Direct - 1.10% ($100K) 1.05% ($50K) Electric Orange Checking
• Incredible Bank - 1.06% Checking ($1K min) account review
• CNB Bank Direct - 1.05% account review
• Clear Sky Accounts - 1.04% (max $250K) account review
• Capital One/Costco - 1.00% InterestPlus Savings ($10K min, includes 10% quarterly bonus) 0.91% (w/o bonus) account review
• Discover Bank - 1.00% Savings (min $500) account review
• ING Direct - 0.90% Orange Savings
• American Express Bank - 1.00%, account review
• Sallie Mae Bank - 1.00% MMA & Savings account review
• airbanking.com - 0.95% Savings
• Capital One - 0.93% InterestPlus Savings ($10K min, includes 10% quarterly bonus) 0.85% (w/o bonus) account review
• Capital One - 0.91% Checking (rate guaranteed for 1 yr) account review
• Ally Bank - 0.85% MMA account review
• Hudson City Savings Bank - 0.90% (min $2.5K)
• Colorado Federal Savings Bank - 0.90% ($2.5K min) account review

Reward Checking Accounts:

• Best Reward Checking Account Rates for a $10,000 Balance - Nationally Available
• Best Reward Checking Account Rates for a $25,000 Balance - Nationally Available

• How to View Rates for Your State

• Noteworthy Accounts Available Nationwide:

• Consumers Credit Union - 4.09% (up to $10K) 0.56% ($10K-$25K) 0.35% ($25K+)
• Lake Michigan Credit Union - 3.00% (up to $15K) 0.00% ($15K+)
• ABCO Federal Credit Union - 2.52% (up to $25K) 0.50% ($25K+)
• Pacific Resource Credit Union - 2.27% (up to $15K) 0.50% ($15K+)
• Provident Credit Union - 2.26% (up to $25K) 0.31% ($25K+)
• First New England Federal Credit Union - 2.03% (up to $15K) 0.25% ($15K+) (extra 1% w/relationship)
• Atlantic Coast Bank - 2.01% (up to $15K) 0.50% ($15K+)
• Community Bank of Raymore - 2.01% (up to $25K) 0.50% ($25K+)
• Community Bank of Pleasant Hill - 2.01% (up to $25K) 0.50% ($25K+)
• Connexus Credit Union - 2.00% (up to $25K) 0.50% ($25K+)
• Heritage Bank - 1.71% (up to $25K) 0.10% ($25K+)
• Avidia Bank - 1.66% (up to $25K) 0.10% ($25K+)
• North Country Savings Bank - 1.50% (up to $50K) 0.75% ($50K+)
• West Texas National Bank - 1.26% (up to $25K) 0.25% ($25K+)
• Bank of Internet USA - 1.25% APY (all balances)

Certificates of Deposit:

• Best CD Rates (Nationwide & by State)
• Best IRA CD Rates (Nationwide & by State)

• How to View Rates for Your State

• Survey of the Best CD Rates for October 21, 2011 (Nationwide & Local)

Various Deposit Account Deals

• Bank Promotions
• Best IRA CD rates, local and nationwide deals
• Latest CD and Savings Account Deals with No Major Deposit Limitiations

Bank Account Alternatives

• Ford Interest Advantage - 1.25% rate for $50k+, Ford Interest Advantage review
• GE Interest Plus - 1.20% rate for $50k+
• Vanguard Prime Money Market Fund - 0.03% 7-day yield
• Vanguard Tax-Exempt Money Market Fund - 0.02% 7-day yield
• Fidelity Money Market Fund - 0.01% 7-day yield (reviews on Fatwallet)
• Fidelity Municipal Money Market Fund - 0.01% 7-day yield
• TIAA-CREF Money Market Fund - 0.00% 7-day yield
• PayPal Money Market Fund has ended effective 7/29/11
• FW Thread on Treasury Bills
• I Savings Bonds for October 2011, I Bond Article, I Bonds as CD Alternatives

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