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Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Survey of the Best CD Rates for September 7, 2012

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Most of the CD rates in my survey held steady in this first week of September. We may not be as lucky in future weeks. Based on today's disappointing August employment report, most economists are now predicting more Fed stimulus at the FOMC meeting next week. That could mean QE3 and an extension of the Fed's low-rates guidance from late 2014 into 2015. A surge in CD rate cuts have come after similar Fed action in the past.

One trend in this year's CD rate cuts is that most of the cuts are affecting the long-term CDs. The CD rate cuts this week at Navy Federal Credit Union are a good example of this. In the last four months, Navy Federal's top 7-year CD yield has fallen from 2.75% to 2.15%. However, its 1-year CD yield has only fallen from 1.05% to 1.00%.

Navy Federal was one of two institutions on my 5-year CD list that reduced its rates this week. Its 5-year Jumbo CD yield fell from 2.05% to 1.85%. Ally Bank is the other institution. Its 5-year CD yield fell from 1.72% to 1.69%.

I now only have 3 institutions on my list of nationally available 5-year CDs that are offering 2.00% APY. All three are all-access credit unions. The highest 5-year CD yield at a bank continues to be 1.90% at CIT Bank.

You can still get a 2.00% APY 5-year CD at BBVA Compass, but this isn't nationally available. You have to live in the market areas where Compass has branches. These are in AZ, CA, CO, NM, AL, FL and TX.

Going out longer than 5 years doesn't buy you much. Third Federal had a good 6-year CD deal, but this yield fell this week from 2.00% to 1.50%. So I removed it from my list.

The best long-term CD deals from a bank are at Discover Bank which continues to offer a 2.10% APY 10-year CD and a 2.00% APY 7-year CD. To get a higher rate, you'll need to either go with a credit union or a brokered 10-year CD.

There was a little bit of good news for shorter-term CDs. AloStar Bank of Commerce raised its 1-year and 2-year CD rates to be near the nationwide rate leaders. Its 1-year CD has a 1.11% APY and its 2-year CD has a 1.26% APY. I still consider CIT Bank's 1-year and 2-year Achiever CDs to be better deals even though their rates are 1 basis point lower. CIT Bank's Achiever CDs offer an add-on deposit option and a rate bump-up option. The only catch is that they have a $25K minimum deposit.

There was also a little bit of good news at Ally Bank. Its 11-month No Penalty CD yield increased from 0.92% to 0.94%. This may seem low, but compared to rates you can find for 6-month CDs, it's high. The no-penalty feature allows this CD to have any term from 7 days to 11 months.

Local CD Deals

The local CD rates in this survey also haven't changed much this week.

The only two institutions that offer 3% CDs without balance caps held their rates steady this week. NavyArmy Community Credit Union in Corpus Christi continues its 3.00% 30-month CD. San Antonio Credit Union (SACU) held steady for a change on its 10-year CD rate. The yield remains 3.35% APY for a $90K minimum and 3.30% APY for a $10K minimum deposit.

I only added one CD to the list. It's a 2.00% APY 4-year CD at Cole Taylor Bank in Chicago. This is available online to Illinois residents. Please refer to my bank and CD review for more details.

Long-Term CD Break Strategy

For the short-term CDs in my lists, you might notice CDs with the note "5-year CD closed after X years". These take into account the yield after the early withdrawal penalty is applied. Since Ally Bank's 5-year CD only has a 60-day interest penalty, it's still a good deal when closed early even with the recent rate cuts.

The risks of planning for early withdrawals of long-term CDs was recently highlighted by another credit union which raised the early withdrawal penalty on existing CDs. The credit union is CEFCU which is based in Illinois. I have more details in this blog post. CEFCU is now the second credit union which has raised the early withdrawal penalty on existing CDs. Last year Fort Knox FCU did the same thing (see my blog post).

Note About the CD Survey

As I described in my rate table overview, you can use our CD rate tables to find the best rates for both nationally available CDs and local CDs. This CD survey blog posts are intended to highlight nationwide CD deals that may not be apparent in the tables. For example, I'll include the post-penalty yields of a few long-term CDs.

The CD survey blog posts are also intended to highlight the local CD deals that are available in large metro areas. There are many high CD rates, but most of these are at small banks in rural areas or at small credit unions with very narrow fields of membership. In these local CD surveys, my focus is on local CD deals that are in big cities or that are available in large areas of a state.

Yields Accurate as of September 7, 2012

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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