Dedicated to Deposits: Deals, Data, and Discussion

Another Salem Five Direct Savings Account Promotion - Available Nationwide


Salem Five Direct

It's not quite as good as last year's promotion, but it's still a good deal compared to what's available today. Salem Five Direct's new savings account promotion offers a 1.00% APY on balances up to $500K on its eOne Savings Account. This rate is guaranteed through the August statement cycle. Eligibility is limited to consumers who apply online and who do not have an existing checking or savings account. They set up a limited time offer page on its website with the details. The eOne Savings Account rate had been 0.85% before this promotion. It has no monthly fees or minimum balance requirement.

Last year Salem Five Direct was offering 1.25% APY guaranteed to April 1, 2012. At that time, you could get rates around 1.50% in savings accounts at a few other banks.

One thing that Salem Five Direct has changed since last year's promotion is to make it clear that only new customers can qualify. Two readers commented last year of the problems they had when they applied for a new eOne Savings account. The bank's disclosure and the CSRs make it appear that existing eOne savings account customers could qualify for this promotion. After they applied and funded the accounts, the bank closed the new accounts without notice.

Bank Overview

I first reported on Salem Five Direct back in 2007 when it was offering the eOne checking account with a 5.30% APY. The eOne Savings account was launched in 2009.

Salem Five Direct is an online division of Salem Five Cents Savings Bank, which is based in Massachusetts. As a Massachusetts bank, it's a member of the Massachusetts Depositors Insurance Fund (DIF) which covers deposits that exceed the FDIC limits. One thing to note about DIF is that it's a private insurance fund. So there's no government guarantee. You can read the details at the DIF website.

Deposits up to the FDIC limits are guaranteed just like they are at every other FDIC member bank. Salem Five has been a FDIC member since 1981 (FDIC Certificate # 23296).

Salem Five has an overall health score at of 4 stars (out of 5) with a Texas Ratio of 13.42% (above average) based on September 2011 data. Please refer to our financial overview of Salem Five Bank for more details.

How This Savings Account Rate Compares

In today's rate environment, the highest rate on a money market account is 1.15% at AmTrust Direct and MyBanking Direct. Flagstar Bank has a promotional rate of 1.15% APY that's guaranteed for four banks from account opening.

If you want a rate that's guaranteed to last until August, you'll need a 6-month CD, but it's hard to find 6-month CD rates of at least 1.00%. KeySource Commercial Bank is offering a special 7-month CD with a 1.00% APY. The best 6-month CD rate at an internet bank is only 0.85%. This is at AloStar Bank.

Ally Bank still offers its No Penalty 11-month CD. The no-penalty feature allows this CD to have any term from 7 days to 11 months. The rate is 0.91%.

These rates are accurate as of 2/1/2012.

Related Pages: Salem Five Direct, savings account, checking account

Related Posts

Comment #1 by Anonymous posted on
I got in on the 1.25% deal last year.  As of April I will be closing my account.  As the reader hyperlinked above said their fee structure is just horrible.  If you sneeze the wrong way you will get a fee. You have to read every bit of the fine print & even then it still isn't clear.  Customer service is poor.  Now before closing my account I will be pouring over the fine print again as if you close the account "the wrong way" you'll be hit with a fee. Not worth the effort.

Comment #2 by Anonymous posted on
I found the bank's customer service representative to be very helpful and highly knowledgeable.  The Salem Five Direct fees and limits do not apply if you initiate the transfers from your external account.  So unless your external account charges a fee or has a limit, this shouldn't be an issue. 


Comment #3 by Anonymous posted on
I'd also avoid setting up external transfer accounts, as Salem Five has (or at least had) an unpublished practice of completely disabling your online access until they could talk to you over the phone to confirm you set these up.  The website mentions the test deposits and the need to log back in to report the amount of those deposits, but it doesn't warn that you won't be able to log back in at all until the phone call.  I suggested they warn people about this practice, but they thought it was only an issue for people on the west coast and it'd be less secure if criminals knew in advance of the practice.  Small banks can sure some up with some crazy ideas and policies.  I hope they've at least made the process of opening a trust account easier (they expect you to mail in a copy of the trust [and know where to send it] before they'll actually mail out the welcome kit that's promised by the website at the end of the online application).

Comment #4 by Rosedala posted on
To Anonymous #3:

"(they expect you to mail in a copy of the trust [and know where to send it] "

Are you sure they expect you to send a copy (entirely?) of your trust?  I have a trust too and all i do is send them only the first and last page of it...and, only for the matter of my beneficiaries.  However, I don't have an account with this bank and it may be different there...

Comment #5 by Jeanne posted on
PLEASE NOTE: The 1.00%APY is only AT THE TIME OF OPENING. They will offer this rate through August, but may not keep the rate once the account is opened (verified with CSR):

"Minimum balance to open the account is $100. The rate may change after the account is opened. The stated APY applies to new eOne accounts opened after 01/24/2012. Fees may reduce earnings."

Comment #6 by Shane (anonymous) posted on
I got into their promotion last year with the 1.25% APY guaranteed rate until April 1, 2012.  The new rate I received after this promotion was the 1.00% APY promo - even though I was an existing customer.  I verified this through their CS dept.  Seems like they mirror Ally Bank here - and take care of their current customers.

Comment #7 by Anonymous posted on
I had a different experience with their CS dept.  I had the 1.25% promo but the website doesn't list an APY on the account details page so I don't know what I'm earning.  I called to find out if the account is earning 1.0% or not and they didn't know if I'd earn that or the 0.85% until the next statement posted in May.  They were willing to extend the 1% offer to people who had the 1.25% offer but also open a checking account (though the saleswoman also mentioned that this can just be done via the website).

Comment #8 by Anonymous posted on
I just opened an eOne savings account with Salem Five.  I was very disappointed when there took back their test deposits.  (Like it's really going to break them to give you two test deposits that are under $1.00 each.)  The reason that I am disappointed that they took the test deposits back are because Ally Bank is counting those as two withdrawals.  So if you already have made your six monthly withdrawals, these two test deposits can end up costing you a $20.00 penalty from Ally.  Salem Five should just deposit the money without taking it back.  All they said at the time of the application is that they would be making two test deposits.  They did not say anything about taking them back.

So beware if you have already made your maximum withdrawals from your funding bank.  You may get hit with an unpleasant surprise.

Comment #9 by Anonymous posted on
Salem Five is an excellent local bank if you want to do business with a brick-and-mortar branch, but these online "eOne" offerings aren't any good. I have had an eOne savings account for over a year, and I will be closing it soon, because I'm not happy. They have these really tight security restrictions around any transaction -- they essentially treat all their online customers like presumed criminals. They limit the amount you can transfer in and out of your account per day and per month, which is incredibly annoying in practice. For example, when I needed a large cashier's check, I was unable to transfer the money to my local brick-and-mortar bank and pick up the cashier's check there; I had to request one be mailed to me from Salem Five. When that check was inadvertantly destroyed, the clueless customer service reps refused to recognize the law pertaining to when those funds had to be returned to my account. I eventually had to show up at a physical branch (thankfully I live in Massachusetts) with a copy of the law to prove they needed to return my money to me after 90 days.

You need an online savings bank with no limits on transfers, so you can always transfer to a local brick-and-mortar branch and do business in person if need be.

Comment #10 by really annoyed (anonymous) posted on
really annoyed
Salem Five has $100 of mine and they will not give it back.

I tried to open a high yield savings account to get the 1.25% advertised in early December , 2012. The first attempt was aborted because they  would not give me an account number for me to fund it (with close to 200k) from my Vanguard account. They told me I needed to open a checking account with them to fund the account; I told them to skip the whole thing and delete my information.

A few days later it occurred to me that I should have tried to open the account and fund it with my USAA checking account. So I went through the whole enrollment process again, but this time was able to fund it via ACH transfer s with USAA. I attempted to fund the account with $100. I then printed out the signature form, signed them and mailed it in. I then verified the online ACH test transactions. This was on  Friday, December 7th.

The following Saturday I received a voice mail message from a Maureen saying she was from Salem Five and asking me to call back. The number was not the same number on the website that I used to apply for the account.

The following Monday I returned the call. The test ACH transactions had been completed, so I was sort of perplexed; what, if anything was wrong? When I spoke to the person she asked that I verify my USAA account information. I informed her there was no way I was giving out that information because I had no idea who I was speaking with. She then told me that there was no way she could grant me the account. I told her that was fine by me and that furthermore this is exactly how scammers phish for personal information to assume other people’s identities. I also said I was going to report her phone number and name to the FBI, and then hung up.

I was annoyed at this point, so I took a deep breath to relax and take a moment to make sure I was not over reacting. It occurred to me that I should call Salem Five to tell them someone is calling me, claiming to be from their bank, so I called the number from the website 800-850-5000. A woman named Maureen answered. DOH!

I confirmed that it was the same person, and then she wanted me to give her my USAA information again. I refused again, because I was annoyed and because it was a lousy process they were putting me through. They had the information! They did the transactions! Then they call me from a foreign number and ask me to give out account information from another bank? I don’t think I want to park 200k there!

Maureen then told me I would not be able to open the account without giving her the information. Fine. I had seen enough to skip the great rate. I had just a few months earlier opened an account at TIAA-CREF with the same rate and had zero problems. Before I hung up, I ascertained that she understood that I was trying to GIVE THEM money. She said she did. That was Monday, December 10th, 2012

I thought I was done with it and started to look for somewhere else to put the money. On December 19th I happen to be reviewing my USAA account and noticed a transfer on December 10th for $100. I had to call USAA to verify that the transfer was to Salem Five because the transfer was noted differently from the ACH test transfers. They confirmed after looking further into it that it was Salem Five.

I had received nothing in the mail, no emails and no phone contact since I had been told my account would be denied. I called Salem Five to point out the problem and asked them to return the money. They offered to send a check, but I requested they return it the way they got it because I would be traveling over the holidays. They said it would be done and apologized for the inconvenience. Fine.

Two days later, December 21st the funds were still missing, so I called back. This time they tell me the account is open, but they cannot give me the account number over the phone. I retorted if the account is open, no one told me. I said get the money to my account by Monday or I am going to make trouble for them. A little later I get a voice mail from Martin at Salem Five. He explained that the issue has been escalated. Of course he starts asking for ssn and then mother’s maiden name, which really ****es me off because I am not a client of theirs.

They should not have accepted that money if they denied the account. If the money had been accepted when they decided to deny the account, they should have returned it immediately. Now Martin is telling me I need to write them a letter to close the account and then get my money, but he can’t give me the account number over the phone.  I decided to write this review instead.

Comment #11 by DougNYC (anonymous) posted on
The 1.25% APY rate for the eOne savings account no longer available (for new customers) . . . but is promised to continue for existing customers who got in on the latest promotion.
See announcement emailed today:

Those who have come on board as a Salem Five Direct customer at the 1.25% APY promotional rate over the last few months, will continue to enjoy this leading rate of return.

If you recently took advantage of the eOne Savings offer from Salem Five Direct at the 1.25% APY promotional rate, we wanted you to be aware that this promotional rate for new customers has come to an end. If you see a new lower rate advertised on our website, we didn't want you to think your rate was being lowered as well.

We appreciate you joining us during this past promotional period and are currently holding your rate at 1.25% APY.

For how long?
As long as we can.

How long is that?
With the interest rate environment in constant flux, we really can't say for sure. We are always striving to strike a balance between the long term needs of our bank and our long term commitment to our customer. Our overall customer satisfaction and loyalty over our many years in this business speaks to our dedication to providing highly competitive products and services, and our eOne customers are no exception.

Comment #12 by Anonymous posted on
After the promotional rate from last year, my eOne savings is currently 0.75% APY.

Comment #13 by Anonymous posted on
Be careful! The 5 year CD @ 2% they are offering comes with a huge 4% penalty on your principal for early withdrawl. They are not up front with this info. I do not trust this bank at all.