Rate Bonus and Special CD for AARP Members at Marcus by Goldman Sachs

Marcus by Goldman Sachs (Marcus) has two good deals for AARP members. The first is a rate bonus for the Marcus high-yield Online Savings Account. Both new and existing Marcus customers who are AARP members can receive an extra 10 basis points on the savings account for 24 months. The 10 basis points are added to the APY that’s published at marcus.com.

As of 7/28/20, the stated APY is 1.05%. Thus, the AARP rate bonus would result in an APY of 1.15%. If the stated APY falls, the bonus APY also falls by the same amount. The bonus APY will remain higher by 10 basis points for a period of 24 months.

The second deal is brand new as of 7/27/20. It’s an 8-month No-Penalty CD with a 1.10% APY as of 7/28/20. This 8-month term is exclusive to AARP members. The standard No-Penalty CDs at Marcus have terms of 7-, 11- and 13-months. Currently, the highest rate of these three is the 7-month with a 0.90% APY.

Both new and existing Marcus customers can enroll or open an account by starting at this Marcus AARP promotions page.

Thanks to DA member alan1 for his DA Forum post on the savings account promotion.

My Take

The 8-month No-Penalty CD currently offers a higher rate premium (20 basis points) over its closest non-promotional No-Penalty CD (the 7-month No-Penalty CD). The longer term of the AARP special CD is actually a benefit for no-penalty CDs. The longer the no-penalty CD term, the better it is. There’s no downside to a longer term. That’s why the 11-month and 13-month No-Penalty CDs have rates lower than the 7-month.

Those who participate in this promotion may feel that the savings account is the better value since it offers a slightly higher rate (1.15% APY vs 1.10% APY). However, savings account rates will likely keep falling in the next few months. At least the CD rate will be locked for 8 months.

Those who haven’t been following rates at online banks may feel that these promotions aren’t good deals. Even without these promotions, Marcus has a history of keeping its savings account and CD rates competitive. The average yield of the Marcus Online Savings Account over the last three years is higher than the average yields of Ally, Discover and American Express. Synchrony’s online savings account average yield is just a bit higher than Marcus. This comparison is based on rate tracking that’s done for the Online Savings Account Index. Of course, the rate history doesn’t guarantee that Marcus will remain competitive.

The benefit of this AARP promotion grows as your balance increases. If you maintain a $100k balance for the 24-month period, you’ll earn an extra $200 over the standard Marcus Online Savings Account. That easily covers the AARP membership fee ($16/year standard membership fee with discounts available).

Full AARP membership is available to anyone 50 years or older. Those under 50 are eligible for Associate membership according to this AARP FAQ. It appears AARP Associate members can qualify for this Marcus AARP promotion.

Account Features

Marcus Online Savings Account and No-Penalty CDs have many nice features. Accounts can be opened and managed easily on the Marcus website or with the Marcus App.

One new and noteworthy feature of the Online Savings Account is that Marcus is now allowing unlimited number of withdrawals per month. The following is an excerpt of a Marcus FAQ:

Due to a change in federal law, you are now free to make more than six withdrawals or transfers from your Online Savings Account in a monthly statement period. At this time, there is no limit to the number of withdrawals or transfers you can make.

This is in response to the April Federal Reserve change to Regulation D. Most banks have been slow in making changes to their savings account withdrawal policies.

Features applicable to all Marcus deposit accounts:

• Accounts can be funded by an internal transfer, an ACH transfer, wire transfer, or check.
• Marcus charges no fees for sending or receiving wire transfers
• Marcus is only able to send wire transfer requests to an account that you own at another bank. Marcus is not able to send or make payments to a third party.
• The maximum amount on deposit for all of your individual and joint deposit accounts combined may not exceed $3,000,000 per account owner, with a $1,000,000 per account maximum.
• Interest is compounded daily and credited monthly to your account.
• Up to six beneficiaries can be added to each account, with Social Security numbers required for each beneficiary. A beneficiary must be an individual: trusts or other entities cannot be named as a beneficiary. Trust accounts are not offered at all.

Features unique to the Marcus Online Savings Account:

• No minimum opening deposit required.
• APY applies to all balances of $1 or more.
• Free ACH bank-to-bank transfer service.
• Up to four external accounts can be linked.
• Maximum outgoing transfer is $125k per transaction if done online (no limit if done by phone).
• No incoming transfer limit (maximum balance limit must be maintained).
• ACH outgoing transfers take one to three business days.
• Funds received by ACH transfer initiated at Marcus available on the third business day. Funds received by ACH transfer initiated by another bank available on the next business day (see FAQs for full details).
• Due to a change in federal law, you are now free to make more than six withdrawals or transfers from your Online Savings Account in a monthly statement period.

Features unique to Marcus CDs:

• $500 minimum opening deposit
• If your Marcus CD account reaches the $500 minimum deposit within 10 days of the day you open your Marcus CD account (opening day plus 10 days), you will receive the highest published APY Marcus offers on the Marcus CD product and term you selected during that period, starting on your account opening date and extending for 10 days.
• Monthly interest disbursements are allowed to your savings account or to one of your linked external bank accounts.
• 10-day grace period at maturity. Interest is earned during grace period up to the day before the funds are withdrawn.
• Partial withdrawals are not permitted

Features unique to Marcus No-Penalty CDs:

• Making deposits: Once the balance of your No-Penalty CD reaches $500 or more, you may not make additional deposits. (This is different from our High-Yield CD, which you can continue to add to during the first 30 days, even after reaching the minimum balance.)
• You may withdraw your full account balance beginning seven days after funding.
• There are no withdrawal fees for a No-Penalty CD, as long as your account has been funded for at least seven days.
• Closing a No-Penalty CD can be done online without any direct involvement of customer service. When closing the CD, the customer can choose to have the funds moved to their Marcus Online Savings Account. If this is done, the transfer will be immediate.

Availability

Marcus by Goldman Sachs is a brand of Goldman Sachs Bank USA. Savings Accounts and CDs are available nationwide and can be opened using the Bank’s online application. Account owners must be at least 18 years old and must be a U.S. citizen or legal resident.

Four years ago, Goldman Sachs Bank USA rebranded as GS Bank as it completed the acquisition of the internet bank portion of GE Capital Bank. The Marcus by Goldman Sachs brand was established in October 2016, functioning as an online platform offering unsecured personal loans to consumers. As I described in a November 2017 blog post, Goldman Sachs decided to consolidate savings accounts, CDs, and personal loans under the Marcus by Goldman Sachs brand. All loans and deposit products are provided by Goldman Sachs Bank USA.

Bank Overview

Marcus by Goldman Sachs has an overall health rating of “A+” on DepositAccounts.com, with a Texas Ratio of 2.94% (excellent), based on March 31, 2020 data. In the past year, the Bank has increased its total non-brokered deposits by $23.51 billion, an excellent annual growth rate of 25.1%. Please refer to our financial overview of Marcus by Goldman Sachs (FDIC Certificate # 33124) for more details.

As of the latest FDIC data (March 31, 2020), Goldman Sachs Bank USA is the 13th largest bank in the country, with more than $254 billion in assets, deposits in excess of $180 billion, and more than 1,520,000 customer accounts.

How the No-Penalty CDs Compare

When compared to the similar No-Penalty CDs tracked by DepositAccounts.com that are offered by internet banks and require a similar minimum deposit, the Marcus 8-month AARP No-Penalty CD APY* currently ranks first. The Marcus 7-month No-Penalty CD APY is tied with the APYs at Ally and CFG Bank.

How the Online Savings Account Compares

When compared to the similar savings accounts tracked by DepositAccounts.com that are offered by internet banks and require a similar minimum deposit, the Marcus Online Savings Account APY with the AARP rate bonus currently ranks fourth.

The above rates are accurate as of 7/28/2020.

To review the best Savings, Money Market, and CD rates, both nationwide and state specific, please refer to DA's Savings Account Rates Table, Money Market Account Rates Table, and CD Rates Table.

*We are continuing to keep our rates up-to-date, but are just too many rate cuts for us to process the changes quickly. For the time being, please be aware that the rates listed at DepositAccounts may not reflect the latest rates published by the banks and credit unions.