Institution for Savings did something unusual today. It not only raised its CD rate, but it also raised it to 2.00% APY. Its 4-year CD now has a 2.00% APY which is up from 1.75%. Its 5-year CD continues to have a 2.00% APY which is also very competitive in today’s environment. Minimum deposit is $500. One downside with these CDs is an early withdrawal penalty that’s above average. CDs with terms of 4 and 5 years have an early withdrawal penalty of 12 months of interest, earned or not earned. The CD details are listed in the bank’s CD page as of 4/15/2013.
In today’s world I’m always a little suspicious of rate hikes, especially when it puts a rate to 2%. So I called the bank and confirmed the rate hike. It’s a new branch special in recognition of the new Topsfield office. However, the CD is available at all of the bank’s branches. A branch visit is required to open an account. I was told that they do accept out-of-state deposits if you can visit a branch. Note, it’s always a good idea to verify qualifications with a branch manager before making any long drive.
Institution for Savings branches are located in the Massachusetts cities of Newburyport, Salisbury, Ipswich, Rowley and Topsfield.
The bank still offers a reward checking account, but the rate has fallen considerably since I first reported on it in February 2008. At that time the rate was 6% APY on balances up to $50K. It fell to 1.01% APY in 2011, and last year it fell to 0.75% APY (see account review).
The bank has an overall health score at DepositAccounts.com of 5 stars (out of 5) with a Texas Ratio of 3.24% (excellent) based on December 2012 data. Please refer to our financial overview of Institution for Savings for more details. The bank was established in 1820, and it has been a FDIC member since 1985 (FDIC Certificate # 90250). Funds over the FDIC limit are insured by the Deposit Insurance Fund (DIF) which is a private insurance fund.
How the CD Rate Compares
It’s not easy to find 2% CDs these days. Without a checking requirement, there’s only one that I know of that’s nationally available. It’s a 5-year CD with a 2.00% APY at Mountain America Credit Union. The best 5-year CD rate at an internet bank is 1.85% APY at Barclays. These rates are accurate as of 4/15/2013.
Best CD Rates
To search for the best nationwide CD rates and the best CD rates in your state, please refer to the CD rates section of DepositAccounts.com.