While DollarSavingsDirect has been the savings account rate leader for most of 2017 (currently 1.60% APY), its CDs have been somewhat lacking. In November, DA reader, Carpline, noted that DollarSavingsDirect had added three new CDs, but frankly, the rates were dismal: 6-month (1.50% APY), 16-month (1.25% APY), and 60-month (1.50% APY). Sperry8 posted a response that echoed the thoughts of many DA readers:
Crazy low. What's the point of even adding these, DollarDirect?
Perhaps the point was setting the stage for raising the CD rates following the New Year? As DA reader, barry_NY, pointed out in a Forum post over the weekend,
Looks like DSD is preparing for much higher rates in the future
by starting to raise CD rates. Not rate leaders, but interesting.
Of the four CDs with new rates, the 60-month is the most competitive. The minimum deposit of any of DollarSavingsDirect’s CD is $1k, with no stated balance cap.
|2.65%||$1k||-||DollarSavingsDirect||60 Month CD|
|2.00%||$1k||-||DollarSavingsDirect||24 Month CD|
|1.90%||$1k||-||DollarSavingsDirect||16 Month CD|
|1.80%||$1k||-||DollarSavingsDirect||12 Month CD|
DollarSavingsDirect has a FAQs page, which answers a variety of questions from, “How do I open a Certificate of Deposit,” to “What types of precious metals do you offer?” The FAQs also explain how to name a single beneficiary through the online application and how your funds are insured by the FDIC.
Since each of EmigrantDirect, DollarSavingsDirect and MySavingsDirect is an online banking division of Emigrant Bank, any deposits you have at Emigrant Bank, EmigrantDirect, DollarSavingsDirect or MySavingsDirect are aggregated and FDIC insured up to $250,000 per depositor.
As stated in the CD Account Disclosure document, the Early Withdrawal Penalty (EWP) reads as follows:
For an account with a term of one year or more, the penalty will be an amount equal to 180 days interest (whether earned or not) and calculated at the contract rate on the principal amount.
DA’s Early Withdrawal Calculator shows on a month-by-month basis what the effective yields are for the 60-month CD. For example,
1.89% APY – closed at 2 years
2.10% APY – closed at 3 years
2.21% APY – closed at 4 years
DollarSavingsDirect is an internet division of Emigrant Bank, which is headquartered in New York City. DollarSavingsDirect offers its product line to individuals who are “at least 18 years old, have a social security number, a legal US address, and a personal checking account in a US bank.”
Opening any CD must be done online. The initial funding of a new Dollar Savings Account can be done online or by check, but subsequent deposits must be done electronically.
The check must be from the same bank account you
established as your linked funding account on the online application.
As an internet division of New York-based Emigrant Bank, DollarSavingsDirect operates under Emigrant Bank’s FDIC Certificate and shares its financial history.
DollarSavingsDirect/Emigrant Bank has an overall health grade of "B" at DepositAccounts.com, with a Texas Ratio of 18.58% (above average) based on September 30, 2017 data. The Bank has an excellent capitalization level (18.87%), the results of holding $6.53 billion in assets with $1.23 billion in equity. Please refer to our financial overview of DollarSavingsDirect/Emigrant Bank (FDIC Certificate # 12054) for more details.
Founded as Emigrant Savings Bank in 1850 by members of the Irish Emigrant Society, Emigrant Bank is the oldest savings bank in New York City. Emigrant Bank has established three internet divisions in the past twelve years: EmigrantDirect (2005), DollarSavingsDirect (2008), and MySavingsDirect (2013). EmigrantDirect was the first internet bank to aggressively respond to the Fed’s rate hikes in 2005. That year the Fed raised the federal funds rate from 2.25% to 4.25%, and EmigrantDirect responded with three rate hikes that increased its savings account APY from 3.00% to 4.00%.
How the CD Compares
When compared to the 182 similar length-of-term CDs tracked by DepositAccounts.com that require a similar minimum deposit and are nationally available, DollarSavingsDirect’s 60-month CD APY currently ranks sixth. However, compared with just internet banks, it ranks second.
|Interest Rate||CD Length of Term||Credit Union/Bank|
|3.00% APY||60-Month Certificate||Connexus Credit Union|
|2.63% APY||60-Month Smart Certificate||United States Senate Federal Credit Union|
|2.60% APY||5-Year Term Deposit Special||Mountain American Credit Union|
|2.50% APY||60-Month CD||DollarSavingsDirect|
The above rates are accurate as of 1/15/2018.
To look for the best CD rates, both nationwide in state specific, please refer to our CD Rates Table page.