After the release of the FOMC July meeting minutes this week, expectations grew that the Fed will begin tapering of its bond purchases at its September meeting. However, economic news continues to be mixed. This week good news in employment was offset by news of weak new home sales. Even if tapering is announced at the next FOMC meeting, the tapering is expected to be fairly small.
It’s important to note that the start of tapering doesn’t mean the Fed is close to raising the Fed funds rate. As mentioned by DA member 51hh in the discussion forum “The gap between tapering and saving rate increase is an unknown time frame that can be several years.” If the improving economy doesn’t gain momentum over the next year, the Fed won’t think twice about delaying rate hikes.
The 10-year Treasury yield went down slightly this week, but the yield is still near 2-year highs. Further gains are possible in all Treasury yields if the August employment report that will be released in about two weeks is strong. This week’s change in Treasury yields and Fed funds futures are shown below. The following numbers are based on Daily Treasury Yield Curve Rates and the CME Group FedWatch.
- 6-month: 0.06% down from 0.08% last week
- 2--year: 0.40% up from 0.36% last week
- 5--year: 1.66% up from 1.60% last week
- 10-year: 2.82% down from 2.84% last week
- 30-year: 3.80% down from 3.86% last week
Fed funds futures' probability of rate hike by:
- Jan 2015: 73% up from 64% last week
- Apr 2015: 89% up from 83% last week
Two banks failed this Friday which is the first time two banks failed on the same day since May 10th. This increases the total number of bank failures for the year to 20. As a comparison, at this time last year there had been 40 bank failures for the year.
Savings & Checking Account Rates
This was another quiet week for rate changes. No banks on my list of top nationally available savings and money market accounts cut rates this week.
We still get an occasional rate cut, but they are not as common as they used to be. With rates holding fairly steady, savings and money market accounts continue to look more appealing than CDs. It’s hard to justify CDs when their rates aren’t much higher than the best savings account rates.
Connexus Y.E.S. Money Market Account continues to hold the top spot with a top-tier APY of 1.15% for a $100K minimum balance. An important downside of this account is that it requires an active checking account and direct deposit.
MyBankingDirect’s money market account is still the best deal for those who don’t want checking requirements or balance caps. It still has a 1.05% APY. This rate has held since June 2012. A DA member recently gave an excellent review in this DA forum thread of his experience with this money market account.
Third place is a tie between the savings accounts of Palladian Private Bank and SmartyPig. Both offer 1.00% APY with no balance cap. SmartyPig has held steady with a 1.00% APY since June 2012.
Reward Checking Accounts
This was another quiet week for reward checking rate changes, at least for those on my list of nationally available accounts. There were no rates or balance cap changes.
Even though there were no rate changes, there was one addition and one removal.
I added Security Bank’s reward checking account, called Security Bonus Checking, to the list. Its top yield is 2.05% for balances up to $25,000. That puts it on top as the best deal for a $25,000 balance cap. It has been added to the list since I confirmed this week that the bank is allowing people from any state to apply for the account using the bank’s online application. It’s a small bank, so this may not last long.
Over the last few years, it has been common for banks to limit who is eligible to open their reward checking accounts. Many reward checking accounts have started out available nationwide, but later have become limited to banks’ local market areas. The latest bank to do this is American Savings Bank, FSB. It’s offering a reward checking account with a top yield of 2.00% for balances up to $15,000. When I reported on this bank in March, it was allowing people in any state to apply. Recently the bank changed its policy, and it now only accepts residents of Ohio, Indiana, Kentucky and West Virginia. Thus, I removed this reward checking account from my list.
To find the highest reward checking rates and balance caps in your state or nationwide, please refer to our reward checking rate table. If you're new to these tables, my rate table guide should be useful. If you're new to reward checking, please refer to my blog post, 10 Common Traits of High-Yield Reward Checking.
- Security Bank reward checking - 2.05% (up to $25K) 0.30% ($25K+) now nationally available
- American Savings Bank, fsb reward checking - 2.00% (up to $15K) no longer nationally available
Rate/Balance Cap Cuts: (from last week)
- Redneck Bank MMA - 0.90% up to $35K (scheduled for 9/19) [currently 1.10%]
- AmericaNet Bank MMA - 0.90% up to $35K (scheduled for 9/19) [currently 1.10%]
- Evantage Bank MMA - 0.90% up to $35K (scheduled for 9/19) [currently 1.10%]
Certificate of Deposit Rates
My recap of CD rate changes and the list of CD deals will now be in my survey of the best CD rates. This recap will now focus on banking news of the week and liquid accounts.
Recap for the Week - Links to This Week's PostsBanking News/Resources
- Two Banks in Tennessee and Arizona Closed by Regulators
- Internet Banks and Living Without Paper Bank Documents
- How Senior Same-Sex Couples Can Take Advantage of the Dilution of DOMA
- No new posts for this week
- Survey of the Best CD Rates for August 23, 2013
- Special 1-Year CD Rate at Communitywide Federal Credit Union - Easy Membership
- EverBank's MarketSafe Evolving Economies CD - Is It a Good Deal?
- Do Callable CDs Make Sense in Today's Rate Environment?
- High Interest Reward Checking Account at Security Bank
- Reward Checking and Savings Accounts at Union State Bank in KS and MO
- Competitive Reward Checking Account in New York at Kinderhook Bank - Local Only
- Unique Reward Checking Account with Debit Card Alternatives at BCU
- Higher Long-Term CD Rates at Dollar Bank in Parts of PA and OH
- High-Rate CD Specials at Firelands FCU - Parts of Ohio Only
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 August 24, 2013
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)
- Noteworthy Accounts Available Nationwide:
- Connexus Credit Union - 1.15% ($100K) 1.00% ($50K) 0.75% ($20K) active chk required
- EverBank - 1.10% MMA/Checking (6mo intro rate) 0.61% ongoing rate, account review
- Redneck Bank - 1.10% MMA (up to $35K) 0.50% (over $35K) [fall to 0.90% on 9/19]
- AmericaNet Bank - 1.10% MMA (up to $35K) 0.50% (over $35K) [fall to 0.90% on 9/19]
- Evantage Bank - 1.10% MMA (up to $35K) 0.50% (over $35K) [fall to 0.90% on 9/19]
- MyBankingDirect - 1.05% (min $5K)
- SmartyPig - 1.00%, account review
- Palladian Private Bank - 1.00% (min $10K) savings account
- Bank X (division of BofI Federal) - 0.95% online savings account
- Bank5 Connect - 0.90% (min $100) online savings account
- GE Capital Bank 0.90% online savings account
- Sallie Mae Bank - 0.90% MMA account review
- Union Federal Savings Bank - 0.90% MMA (min $2.5K) account review
- Salem Five Direct - 0.90% savings, for new customers only
- Barclays - 0.90% Savings account review
- Incredible Bank - 0.86% MMA ($2.5K min) account review
- SFGI Direct - 0.86% account review
- CIT Bank - 0.85% ($25K) 0.80% ($100) Savings, account review
- American Express Bank - 0.85%, account review
- Colorado Federal Savings Bank - 0.85% ($2.5K min) account review
- Capital One 360 - 0.85% ($100K) 0.80% ($50K) 360 Checking
- FNBO Direct - 0.85% Savings
- GE Capital Retail Bank (formerly MetLife) - 0.85% ($25K) 0.80% ($10K) Savings/MMA
- Sallie Mae Bank - 0.85% Savings account review
- Mutual of Omaha Bank - 0.85% Savings (min $25) account review
- Ally Bank - 0.84% MMA/savings
- Clear Sky Accounts - 0.80% (max $250K) account review
- Discover Bank - 0.80% Savings (min $500) account review
- ableBanking - 0.80% MMA (min $1K)
- Nationwide Bank - 0.76% MMA (min $1K)
- Bank of Internet USA - 0.75% MMA
- Capital One 360 - 0.75% 360 Savings
- Alliant Credit Union - 0.70% (min $100) Savings account review
- Incredible Bank - 0.66% Checking ($1K min) account review
- Alliant Credit Union - 0.65% Checking (req's elec. dep & e-stmts) 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
- Noteworthy Accounts Available Nationwide:
- Great Lakes Credit Union - 4.00% (up to $10K) 0.05% ($10K+) Ultimate Checking
- Consumers Credit Union - 3.09% (up to $5K) 0.20% ($5K-$25K) 0.10% ($25K+)
- Money One Federal Credit Union - 3.01% (up to $10K) 0.51% ($10K+)
- INOVA Federal Credit Union - 3.00% (up to $20K) 0.15% ($20K+)
- Lake Michigan Credit Union - 3.00% (up to $15K) 0.00% ($15K+)
- Belvoir FCU - 2.53% (up to $15K) 0.05% ($15K+) CUXcel Checking
- Capital Educators Federal Credit Union - 2.50% (up to $10K) 0.20% ($10K+)
- Security Bank - 2.05% (up to $25K) 0.30% ($25K+) Security Bonus Checking
- ABCO Federal Credit Union - 2.02% (up to $25K) 0.20% ($25K+)
- Redneck Bank - 2.00% (up to $10K) 0.50% (over $10K)
- AmericaNet Bank - 2.00% (up to $10K) 0.50% (over $10K)
- Evantage Bank - 2.00% (up to $10K) 0.50% (over $10K)
- Provident Credit Union - 1.76% (up to $25K) 0.11% ($25K+)
- Connexus Credit Union - 1.75% (up to $25K) 0.31% ($25K+) Xtraordinary Checking
- Community Bank of Raymore - 1.75% (up to $10K) 0.25% ($10K+)
- Community Bank of Pleasant Hill - 1.75% (up to $10K) 0.25% ($10K+)
- First Tech Federal Credit Union - 1.58% (up to $10K) 0.16% ($10K+)
- Aspire Federal Credit Union - 1.51% (up to $10K) 0.25% ($10K+) Kasasa Cash
- BofI Federal Bank (affinity groups) - 1.50% (up to $150K) 0.00% ($150K+)
- Avidia Bank - 1.36% (up to $25K) 0.05% ($25K+)
- West Texas National Bank - 1.26% (up to $25K) 0.25% ($25K+)
- Heritage Bank - 1.26% (up to $25K) 0.10% ($25K+)
- First New England Federal Credit Union - 1.25% (up to $15K) 0.10% ($15K+) (extra 1% w/relationship)
- Bank of Blue Valley - 1.25% (up to $15K) 0.10% ($15K+), $1K/month debit card req (account review)
- Bank of Internet USA - 1.25% (up to $150K) 0.00% ($150K+)
- BankFirst Financial Services - 1.24% (up to $50K) 0.15% ($50K+)
- Legence Bank - 1.05% (up to $25K) 0.25% ($25K+)
- North Country Savings Bank - 1.05% (up to $25K) 0.75% ($25K+)
- State Bank of Toledo - 1.00% (up to $25K) 0.15% ($25K+)
Certificates of Deposit:
- Survey of the Best CD Rates for August 23, 2013 (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 - NOT FDIC Insured
- Duke Energy PremierNotes - 1.40% rate for $50K+, Duke Energy PremierNotes review
- Ally Financial Demand Notes - 1.35%, Ally Demand Notes review
- Ford Interest Advantage - 1.10% rate for $50k+, Ford Interest Advantage review
- GE Interest Plus - 1.10% rate for $50k+
- Vanguard Prime Money Market Fund - 0.01% 7-day yield
- Vanguard Tax-Exempt Money Market Fund - 0.01% 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
- Series I Savings Bond Purchases from May to October 2013, I Bond Article, I Bonds as CD Alternatives