Dedicated to Deposits: Deals, Data, and Discussion

10,000th Post Milestone - Look Back at 8 Years of Bank Deals and News

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We’re celebrating a milestone today. This is the 10,000th blog post since I started the Bank Deals Blog in August 2005.

Thanks so much to all of you who have been regular readers and commenters throughout the years.

I started the Bank Deals Blog over eight years ago in August 2005. As a fellow saver, I was always on the lookout for bank deals. In 2005 I decided to start this blog to help others find those deals and to encourage collaboration among savers to help each other find the deals and to learn about the various issues and gotchas. The blog and the readership grew more than I could have ever imagined. In 2009 when I was offered a partnership, I decided it was a great opportunity to grow the blog into an even more useful resource. That’s when the Bank Deals Blog at Blogger was converted into DepositAccounts.com, a self-hosted website that allowed for features like rate tables, a bank database, and a discussion forum. In addition to rates, the bank database holds financial health data, branch locations and user ratings.

Over the history of the website, users have posted over 75,000 blog comments or forum posts. We're now tracking almost 300,000 rates from thousands of banks and credit unions. When rates change, readers can be automatically notified by email through our bank alert system. Readers have signed up for more than 6,000 bank alerts.

I thought it would be interesting to look back at some of the past deals and news mentioned at DepositAccounts.com over the eight years.

What Were Your Favorite Deals?

Before I review the past deals and news, I want to ask you to recall your favorite deals that you learned about from DepositAccounts.com. Did the deal turn out to be as good as it sounded? Also, how has the website helped you with your savings? Please leave a comment. Your testimonies would be greatly appreciated.

CDs vs Stock Market

I know most financial planners will stress how important it is to invest in stocks for long-term growth. Those who invest in stocks will have to be prepared for risk and volatility. We saw this back in 2008 and 2009 when the stock market tanked. You may not want to invest all of your savings in CDs, but for the part you want to keep safe, CDs can offer reasonable gains without any risk. And if you use DepositAccounts.com to find the best deals, your CD returns can be improved without any additional risk.

I thought it would be interesting to compare an investment in select CDs with a stock market investment. The following chart compares the performance of two investments made about eight years ago when this blog started. The first is a $100,000 investment in the Vanguard S&P 500 Index Fund. The performance shown for this investment includes appreciation and dividend reinvestment.

Stock market vs CDs

The second is a $100,000 investment in select CDs. Instead of using past average CD rates, I chose CDs that were nationally available and had top rates. The first CD I chose was offered at Patelco Credit Union in January 2006. It had a 5.00% APY and a term of 12 months. When that CD matured, the PenFed CDs with a 6.25% APY became available. So the second CD I chose was a 7-year PenFed CD with a 6.25% APY.

Even with this year’s big stock market gains, the total return of the CD investment is pretty close to the stock market investment. The primary difference is that the CD investment only grew. The value didn’t plummet like the S&P index fund did in 2008 and 2009.

Deals and News Back in 2005

My first blog post was "Online Banks Battle For Our Dollars" in August 2005, and the post had a review of three online banks: ING DIRECT, EmigrantDirect and HSBC. It’s interesting to see how things have changed since then. ING DIRECT is now Capital One 360, and like eight years ago, it still offers competitive rates. Since 2005, Emigrant Bank added two more internet divisions: DollarSavingsDirect and MySavingsDirect. All three offer internet savings accounts, but only MySavingsDirect has a competitive rate. Finally, HSBC has essentially given up on its internet savings account. The rate has dropped to an uncompetitive level of only 0.05%.

Emigrant's new MySavingsDirect is offering a top savings account rate

The big news at the end of August 2005 was Hurricane Katrina. One bank made news about what it did after the hurricane. EmigrantDirect issued gifts of $1,000 to all of its customers affected by Hurricane Katrina.

Past Savings and Money Market Account Deals

The interest rate environment has been tough on savers over the last six years, but there have been a few good savings account deals. The best ones offered not only a top rate but a rate guarantee for a certain period of time.

One of the first nationwide deals I reported on was at ING DIRECT. In early 2006 it launched the Winter Save Up Sale which guaranteed 4.75% on new money in its savings account through April 15.

In 2007 HSBC’s internet division HSBC Direct ran a promotion that was very similar to ING’s Winter Save Up Sale, but the promo rate was higher. HSBC guaranteed 6.00% APY on new money in its online savings account until April 30th. An even better deal came up later that year when FNBO Direct offered 6.00% APY on its new internet savings account until September 28th. The only problem with FNBO Direct was that it was a new internet bank which had many problems, and that angered many Bank Deal readers.

EverBank still offers a top rate guaranteed for 6 months for new customers

A top rate with a rate guarantee is a nice way for new internet banks to get noticed. That’s what CNB Bank Direct did in 2008 when it offered a 4.00% APY on its no-minimum online savings account and guaranteed that rate for the first 6 months of account opening. One thing we learned with CNB Bank Direct is that you can’t assume internet banks will keep their rates competitive. CNB Bank Direct kept their rates competitive for a couple of years after this promo, but the rates kept falling, and its savings account now has a pathetic rate of 0.21%.

Not all of the best savings account promotions had rate guarantees. Some of the best deals offered a cash bonus. One noteworthy one was at WT Direct which offered a bonus of up to $500 for new deposits in its online savings account.

Past CD Deals

If we had an award for the institution that has offered the most and the best CD promotions since this blog started, I would give PenFed the prize. PenFed has consistently offered great CD deals. Back in early 2007, PenFed offered CDs with a 6.25% APY for terms from three to seven years. Then when this awful interest rate environment was well entrenched in late 2010, PenFed offered a 5% CD. It had a very long term of 10 years and it wasn’t advertised to everyone, but it offered savers a CD rate that hadn’t been seen since 2008. This year it seemed PenFed would never get back to its good old days with top CD rates, but it pleasantly surprised many of us in November with a 2.02% APY 3-year CD and this month with a 3.04% APY 5-year CD.

Reward Checking Accounts

Reward checking accounts first began to be introduced in the early days of the Bank Deals Blog. My first report on a reward checking account was in September 2006. A small Arkansas bank was offering a checking account with a 6.01% APY for balances up to $25,000 if certain monthly requirements (like 10 debit card purchases) were met. The popularity of these accounts exploded in 2007. During the years from 2007 to 2009 I was reporting on a new reward checking account every other day.

Search our reward checking table for the best rates and caps

The best reward checking account deals came out in 2007 from institutions like State Bank of Toledo and First Arkansas Bank and Trust which offered rates close to 6.00% with no balance caps. As we know, this didn’t last. Rates fell and balance caps were introduced. However, after seven years, hundreds of banks and credit unions continue to offer reward checking accounts with rates higher than what you can get from internet savings accounts. All have balance caps, but many still have caps of $25,000 which still makes the reward checking accounts worthwhile for many savers.

Past Bank Failures

When I first started the Bank Deals Blog, bank failures were rare. In fact, there were no bank failures in 2005 and 2006, and there were only three failures in 2007. That changed with the start of the financial crisis in 2008. The number of bank failures went from 25 in 2008 to 157 in 2010, the peak year.

One of the first bank failures that I reported on was the closure of Netbank in 2007. This bank was closed in September 2007, and the FDIC arranged for ING DIRECT to assume insured deposits. Many Netbank customers who had deposits over the FDIC limit lost money.

There are several ways to obtain FDIC insurance for deposits over $250,000

It was common for those with uninsured deposits to lose money at failed banks, but that changed after IndyMac Bank failed in July 2008. It failed right before the financial crisis reached its peak, and the FDIC began arranging purchase agreements that required the acquiring banks to assume all deposits of failed banks. Thus, the large majority of banks that failed after IndyMac did not cost depositors any money, even if they had balances over the insured limits. The main worry for depositors was the loss of the high CD rates since the acquiring banks were allowed to lower the interest rates on existing CDs.

The largest bank failure in U.S. history occurred during the financial crisis when WaMu failed and was acquired by Chase. This failure was bad news for WaMu shareholders, but it had little impact on WaMu depositors. In fact, depositors were able to get top CD rates at WaMu for several weeks after the Chase acquisition. Eventually, those deals ended and rates plummeted as Chase transitioned WaMu into its banking system.

There were also failures of institutions that pretended to be banks. One interesting case was the Caribbean-based Millennium Bank. This "bank" advertised heavily on the internet with unusually high CD rates. I reviewed this "bank" in 2005 and warned of several red flags. It turned out to be a ponzi scheme. It was shut down by the SEC in 2007.

Favorite Past Deals? Future Wants? Predictions?

Don’t forget to comment about your past favorite deals that you learned about from DepositAccounts.com. In addition to deals, how has DepositAccounts.com helped you with your savings? Also, we don’t want to rest on our laurels. Are there any improvements you would like to see at DepositAccounts.com?

And finally, do you have any predictions about interest rates or the banking industry eight years from now when we will hopefully be nearing our 20,000th post?

I thought it would be fun to include a poll that asks what will be the rate of the top internet savings account eight years from now. Will we see those 5% savings account rates again?



Related Posts

Comments
Comment #1 by melman posted on
melman
Boy, that graph is awfully misleading if it only considered a 12-mo CD from Jan 2006 and a 84-mo CD from Jan 2007.  That's cherry-picking your data to be sure.

A graph of some typical CD ladders starting in 2006 would paint a much different picture.

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Comment #2 by Anonymous posted on
Anonymous
Ken, you have done one heck of a job of helping us rate chasers in finding the best deals across the country.  One of my favorites is the Penfed 5% certificates with a 10 year term back in 2010.  Even though it was sort of a **** up at the time, Penfed still honored all reserved certificates at those terms.

 

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Comment #3 by Anonymous posted on
Anonymous
you have done a great job with this blog.  It has been extremely helpful.

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Comment #4 by psjf posted on
psjf
melman #1 - That's the great thing about Ken's service - we're able to cherry pick!  

Ken, it wasn't as large of an overall amount because of the max deposit cap, but one of the deals that stands out to me was the WT Direct deal you mentioned.  I remember the scramble to get into that deal as it was very short-lived and a lot of people weren't able to get in in time.  I was at the beach with my family and ended up spending more time than I had hoped in the room trying to move everything around for that deal.  

The ways your site has helped me are too many to mention.  A big congrats on the 10,000th post. Here's hoping we're finally moving back in the right direction towards some of those rates you mentioned from yesteryear.  I hope the recent PenFed increase wasn't just a tease.  

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Comment #5 by Ally posted on
Ally
To #1 Melman--

In 2006 we purchased several 6.25% CD's. We purchased reg CD's, traditional and Roth IRA's.  They are maturing the end of this month and next year. Ken is posting also on the 6.25% CD's that many of us purchased at PenFed. Before that many of us had CD's that we purchased in and around 1999-2000 for between 8 -10%. There seems to be a 5 to 8 year cycle in rates. 

Ken thank you for all your help. You have helped millions of us I am sure.  


 

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Comment #6 by Anonymous posted on
Anonymous
Your chart represents our experience fairly accurately.  We have 1/2 of our

money in the mkt. and 1/2 in stocks/bonds etc.  The results as of today have

been just about the same $ wise.......considerably less aggravation with the

c/d's  but better tax consequences with stocks, bonds etc.  We will continue to

keep our "has to be safe" money in the c/d's .... you introduced us to Credit

Unions--which has been a blessing.  Of particular benefit has been Navy FCU,

Pentagon FCU,  Library of Congress FCU and Velocity CU.  Keep up the great

work--it is appreciated immensely.  The c/d's enable us to have alternate

(growth type investments) and be able to sleep well at night.

We hope that you are not incurring a great expense in maintaining this blog

site--if so we would be willing to pay a small yearly fee for your service..

($10-20/yearly). 

Thanks again and happy holidays.

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Comment #7 by Shorebreak posted on
Shorebreak
Has it been that long already? Gee, time sure flies when you are making money thanks to Ken's depositaccounts.com site.

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Comment #8 by Anonymous posted on
Anonymous
I can't recall a specific deal.   What was most useful was sharing both the good finds and the bad finds.   I recall getting some really good CD deals at Navy Federal but over the last several years they are just so so, nothing special.   I enjoy reading all the posts, recently those covering Pen Fed's 3% CDs.   The thing that bothers me the most is that savers are the "silent majority" in the news.  The so-called financial experts are so giddy about the stock market flying high, they can't see anything else --- I guess it's "greed".   When the financial collapse took place, my spouse and I had some retirement funds in the market (about 10% of the total), so we were not hurting like it seems everyone else was.  We waited out the turn around and broke even and then moved those funds to interest bearing accounts.   Since then we have not bought a single mutual fund or stock.   If we were in our youthful years, I guess we would be still trying to outpace inflation in the stock market, but we are both retired and want to sleep nights and not worry about losing half the principal which happened to some folks.

Now savers are subsidizing borrowers.   Big corporations with many dollars on their balance sheet (but parked overseas) go to the market and borrow at fixed or manipulated low interest rates  and you can guess who is on the losing side of the deal, the ordinary saver.  (If they want to bring the money back to the U.S. the corporation has to pay taxes on it and they don't want to do that so they will issue low interest bonds here so all of us ordinary folks can buy them and earn substandard returns. )  Then the corporation  repurchases stock so their stock price will go up.  A perfect example is Carl Ichan's call for Apple to buy back $50 billion of stock.   Of course, Apple has not agreed yet, but you see the picture.  So who will be benefitting -- the billionaires and those betting or gambling with the assistance of margin.  All of this, of course, comes with the blessing of Ben Bernanke who wants everyone to take on risk, including the elderly and other savers.  Thank you no, I'll pass on the risk.   I'd rather do with less and not wake up one day to find I only have half of what I thought I had due to a major stock market correction.

I do enjoy Rick Santelli's commentary on CNBC TV.  I think he tells it like it is and this morning, he was telling us to watch the 10 year Treasury Bond, which again is inching towards 3%.   Late yesterday on Fast Money, Dennis Gartman of the Gartman letter, said he sees 4% on the 10 year Treasury come 2014.   So right now I am content with around 1% on insured liquid money.   I am sure one of these days that a CD offer will come up that I cannot refuse so I am waiting before committing to any long term deals.

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Comment #9 by scottj posted on
scottj
Congrats Ken!! Without this blog I would not have found Penfed when I did years ago. Some of my best deals came from thier including some 6% CDs and also got in on the 10 year 5%. Have found many great deals here over the years following and like to feel I also contributed a few. Also someone once told me that if you compare CDs to the market over a long time period the difference is not much and your chart shows that. Finding the very best deals played a part in my retiring 4 years ago at 48. So thanks Ken for all you have done for us 

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Comment #10 by Anonymous posted on
Anonymous
Ken, thank you very much for all the time and effort you have put in this blog over the years.  August 2005 was exactly when I inherited the money I have been putting in CD's.  I was able to close some cds not paying so well due to the death of the owner and reinvest. Your blog was so helpful.  As everyone has said discovering Pen Fed is the absolute best.  But I've gotten deals at Melrose CU, Key Direct, NFCU and a few years ago US senate credit union.  You have been my go to web site when I have money to invest.  

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Comment #11 by decades posted on
decades
That's cherry-picking your data to be sure......BUT you could say the same thing about the stock market ...at this particular point in time we have had a huge run and are at an all time high....like the equity curve of the cd a lot better too

Ken , i think you should have a hall of shame for the banks that are paying the lowest CD rates ..ie.0.20%  for BOA 5yr. cd geez

THis has been a fantastic resourse ... I got in on the aforementioned 6.25% 7yr. due 1/30/14 :( ......Also remember once Midwest credit union was paying 7.15% on reward checking ..not sure if heard that here ..

the other day needed to know the EWP for a cd taken out at pentagon FCU back in 2010 or 11...had lost the paper work on it...so i just googled ..bank deals pentagon fcu ,the date and rate. ...and there it was ...you explaining the EWP for that particular cd ....

Thanks a $million$ Ken

 

 

 

 

 

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Comment #12 by me1004 posted on
me1004
Congratulations for the milestone, Ken. Gee, my fingers hurt just thinking about all the typing for 10,000 posts! IK wonder how may keystrokes that was. Ouch!

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Comment #13 by Anonymous posted on
Anonymous
Ken, congratulations and thank you for all the work you have been doing! Aside from the great deals from Ally, Penfed, etc. I also found your local deals have had some great selection and used some of them, even out here in the midwest! Your Blog is the best!

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Comment #14 by Anonymous posted on
Anonymous
Ken, Thanks a million!

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Comment #15 by lof posted on
lof
Ken, seems like it's been more then 8 years (how long sense you changed the format).  It's always been the best site for rates and the only one I use!  In very simple terms "THANK YOU".  The LOF        Again it can't only be 8 years.

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Comment #16 by RickNP posted on
RickNP
Ken,  In the early days, you offered a link to something called a "tip jar," which allowed some of us grateful readers to give you a tangible gratuity via PayPal. In light of all those proudly proclaiming the hundreds of thousands you've earned them over the years, I'd suggest reactivating that concept so they could thank you as you desrve to be thanked.

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Comment #17 by cumulus posted on
cumulus
I stumbled across this Blog back in 2006; thing that absolutely
floored me was the clarity, directness and accuracy of Ken's writings.
Too good to be true; no way this is going to last I thought. This Ken
guy will be captured by a zillion dollar contract from the Yankees!

Eight years later, the excellence continues---no, it's even better.
Indy Mac 5.71%, Premier CU & Patelco 7.00% from the early days
through Penfed 5.00% a few years ago. Ken is to deposit accounts,
what Google is to searches.  Thank you, thank you.

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Comment #18 by Rosedala posted on
Rosedala
CONGRATULATIONS AND HAPPY ANNIVERSARY KEN!!!  Thanks to your knowledge, ingeniosity and hard working spirit, I've learned so much, and yes, I too was able to take advantage of the terrific deals you sought, found and instantly published for us!  And also feel that Penfed is the star among stars of the good CD deals so far! 

So....THANK YOU for all you're doing for us!  I second those members who suggested to give some kind of remuneration.  It's proper, it's necessary and you well deserve it.   :o)     Adela

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Comment #19 by OldGuy posted on
OldGuy
I use a variety of information sources for CD deals, so, with the exception of the Luther Burbank Savings 3-year promotion I highlighted in connection with an earlier post, I actually can't remember where or how I've stumbled onto most of my relatively good CD deals.  There's no question, however, that this site has been an invaluable tool to savers like me during a particularly godawful period of time for rates.  Keep the flag flying, Ken.

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Comment #20 by gbtexas (anonymous) posted on
gbtexas
Ken, thanks so much for your blog and your willingness to keep it up to date.  By far, you're the most accurate and most in depth of all the internet sites.  I'm just surprised that at least one of the other sites hasn't shown a willingness to follow in your footsteps.  Perhaps, like the majority of the oligopolistic U.S. car companies, pride prevented them from dealing with reality, which of course led to all of their downfalls, that is all other than Ford.

1
Comment #21 by ct (anonymous) posted on
ct
For those that got in on those PenFed CDs, now it's like having gotten in on Netflix stock at $20. I can always remember you articles cautioning about locking in rates, even during those high times as we couldn't see that crash coming - few ever do.

Congrats Ken for all the hard work and helping me buy some new toys and give the Chex system a little workout at times!

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Comment #22 by Anonymous posted on
Anonymous
Like so many of us, am indebted to you Ken for your extensive canvassing and especially for introduction to Pentagon FCU.

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Comment #24 by Anonymous posted on
Anonymous
One day I stumbled on your blog but doing a google search for CD specials.  It was the post about American Bank of Texas in Mckinney TX special 10% APY 12-month CD (max 5k) posted in Aug 2006 that had me hooked.  Ironically I was planning on being in Mckinney the following day for a work project.  I recently closed that account which required a checking account I rarely used. Thanks for all you have done!

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Comment #25 by Anonymous posted on
Anonymous
I want to sincerely thank you Ken. I am a fairly new reader to your blog and so, alas, I haven't been able to take advantage of some of those juicy yields in the 5-6% range of yesteryear. But I have been avidly following your reward checking account and my wife and I diligently diversify our liquid cash in institutions that have 3% interest rate and make sure to jump through all the hoops to get our high interest rate. We recently plunked down some of our savings in PenFed's 3.04% rate in 5-yr and 7-yr rates. That was a tough decision for us because I'm not good at making predictions and I can't tell if we are going to be in a Japan zero-interest rate land for the foreseeable future thanks to the fed and the increasing US debt, or rates will push up sooner rather than later.

Thank you Ken, the service you are providing is powerful and immensely helpful. I've told all my family about this site. I also enjoy hearing comments from other intelligent savers as I am in my early 30s.

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Comment #26 by Ally posted on
Ally
Remember reading about "Bank Deals" in the WSJ at work. We didn't even have internet in the city I lived in. When I finally got dial-up this was the first place I went to. Ken you have helped so many  people and so many are so grateful. When I think of all my friends that were in the market and lost so much it is so sad. Your readers can go for CD's and sleep nights and know exactly what we all  will end up with. I don't like uncertainty. THANK YOU. 

10
Comment #27 by 10094DD posted on
10094DD
Many, many thanks, Ken, for all your hard work over these years.  You have created a magnificent website.  I have followed you since you were reporting on Bank Deals Blog, and continue to be impressed by the care in which you report your data;  the extent of the data;  the carefully-researched and relevant commentaries you make on a variety of savings-related topics in addition to the latest rates;  the calculations you provide to enlighten us on which investment paths to take;  and the clarity of your presentation.  This is a fantastic resource for that portion of one's portfolio that is reserved for investment safety.  And being amongst fellow savers similarly struggling in this low-rate environment, is comforting.
Yes, I am one of those who learned about Pen Fed's 6.25%, 5-yr certificates from your website back in 2007, and bought one.  How can I ever thank you enough for that, as well as all the other CDs I learned about from you?  I remember making a small contribution to your "tip jar", and promising that a larger tip would be coming at a later date.  Much to my surprise, you sent me an email, thanking me!  What a nice fellow is in charge here!  Unfortunately, the tip jar disappeared soon afterwards, before I could make another contribution.  Do know, however, how much I continue to appreciate your work.  Great job, Ken!  You have every reason to be proud of this site.   

7
Comment #29 by Anonymous posted on
Anonymous
I agree that a return of the "Tip Jar" would be an appropriate way for us to thank you properly.

2
Comment #28 by Dave posted on
Dave
Congrats Ken on the milestone. I first visited BankDealsBlog (before we knew you as Ken) around summer 2008, right when things got interesting, and have visited it almost every day since then. It's simply the best site on the internet hands-down for rate information, reviews, updates and promotions. Also a good place to vent with fellow savers when the good deals go away or those great rates drop due to a bank closing. 

One of the best ways to measure the value of the site is the number of good accounts we've signed up for (and bad ones we're avoided!). 

I got in on Countrywide 4.2% 1-yr CD's and 3% savings, the WaMu 5% 1-yr CD, the DollarSavingsDirect 4% savings and 4% 16-mo CD, the 3/4/5% step-up Darby 36-mo CD (even though that didn't last) and Darby 3% savings, the 2.25% SFGI savings account, the WTDirect $500 bonus, and finally the Ally savings and 5-year CD with low penalties. 

That's a lot of money saved. 

Wish you the best with this new website and hope all the hard work you put into it over the years rewards you well. 

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Comment #30 by jib2424 posted on
jib2424
great website

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Comment #32 by Gonzalez AF posted on
Gonzalez AF
I remember when kent use to do the update himself. this was a great site.

1
Comment #33 by Gonzalez AF posted on
Gonzalez AF
Nice Job Kent, I have been a user since day one when you were running the blog.

1
Comment #34 by Spring posted on
Spring
Ally Bank.  Until recently had fabulous penalties of 60 days and in previous years good rates.

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