With a variety of rate increases this yesterday morning, SallieMae Bank is continuing to keep its product line APYs competitive. While the individual rate increases haven’t been exceptional, the cumulative effect has kept SallieMae Bank within striking distance of the rate leaders.
Money Market Account
The Money Market Account (MMA) continues to be SallieMae Bank’s most competitive deposit account with its current 2.20% APY. There have been nine rate increases since the beginning of the year, adding a total of 88 bps to the MMA APY.
The MMA has no monthly service fee and can be opened with as little as $1. While there is no minimum or maximum balance requirement for SallieMae Bank’s MMA,
if you open an Account that remains dormant, with a balance of $100 or less
with no activity for the past 12 months, we reserve the right to close the Account.
SallieMae Bank’s MMA offers check writing, unlike some other so-called MMAs, like Capital One's 360 Money Market (2.00% APY) or CIT Bank's Money Market Account (1.85% APY). Checks are provided at no cost if they are ordered when the MMA is opened; any check order placed after account opening will cost $5. There is also a $10 Excessive Transaction Fee for each item beyond the limit of six transactions per month.
If you repeatedly exceed this limit, we’re required to close your account(s).
SallieMae Bank’s product line is atypical, in that its high-rate account is the MMA (2.20% APY), rather than the High-Yield Savings account (2.10% APY). While the MMA and High-Yield Savings are similarly structured with no tiers or fees, the MMA's check writing ability gives it a distinct edge: when withdrawing a large amount, the money will keep earning a top rate until the check has posted and settled. As a DA colleague said, “that’s often a reason banks offer higher rates on their savings account, rather than on their MMAs.”
Complete details about the MMA (including POD account information) are available on Deposit Account Terms and Conditions Agreement page, including information on SallieMae Bank’s transfer service. While the ACH transfer service has several nice features, such as the ability to handle large transfers, the one downside is long hold times. When an ACH deposit of over $5k is made via SallieMae Bank's transfer service, the hold time for the amount over $5k is 10 business days.
Following yesterday’s rate increase, the High-Yield Savings now earns 2.10% APY on all balances. Since January, the High-Yield Savings has had eight rate increases, adding a total of 110 bps.
The High-Yield Savings has no minimum opening deposit or minimum balance requirement, but a dormant account (a balance of $100 or less with no activity for the past twelve months) may be closed. There is also an Excessive Transaction Fee of “$10 for each item that exceeds the maximum number (6) of transactions.”
SallieMae Bank CDs
SallieMae Bank also raised the rates on three of its CDs, but the new APYs fall well short of the current rate leaders. The minimum deposit for any of the CDs is $2.5k, with no stated balance cap.
|3.10%||$2.5k||-||Sallie Mae Bank||60 Month CD|
|3.00%||$2.5k||-||Sallie Mae Bank||24 Month CD|
|2.85%||$2.5k||-||Sallie Mae Bank||12 Month CD|
As stated on SallieMae Bank’s Certificate of Deposit FAQs page, the Early Withdrawal Penalty (EWP) reads as follows:
- If your CD has a term of 12 months or less, the penalty will be equal to 90 days’ simple interest.
- If your CD has a maturity term greater than 12 months, the penalty will be equal to 180 days’ simple interest.
Thanks to DA reader, buckeye61, for another informative Forum post about SallieMae Bank.
Headquartered in Salt Lake City, Utah, SallieMae Bank is an “pure” internet bank, with no brick-and-mortar branches. Accounts may be opened by individuals who have a Taxpayer Identification Number (usually a Social Security Number) and a physical address in the United States. Opening any account, including CDs, Money Market, and Savings accounts, must be done online.
SallieMae Bank has an overall health rating of "A+" at DepositAccounts.com, with a Texas Ratio of 1.42% (excellent) based on June 30, 2018 data. In the past year, SallieMae Bank has increased its total non-brokered deposits by $1.17 billion, an excellent annual growth rate of 15.97%. Please refer to our financial overview of SallieMae Bank (FDIC Certificate # 58177) for more details.
The "SallieMae" brand is most often associated with private student loans. The Student Loan Marketing Association (aka SallieMae) opened its doors as a Government-Sponsored Enterprise (GSE), designed to support the guaranteed student loan program created by the Higher Education Act of 1965. Chartered in 2005, the internet-only SallieMae Bank has expanded its product line beyond student loans to include CDs, Savings Accounts, Money Market Accounts, Insurance, and Credit Cards, and today has assets in excess of $24 billion, with more than $17.1 billion in deposits.
How the Money Market Account Compares
When compared to the Money Market accounts tracked by DepositAccounts.com that are available nationwide and have a minimum deposit requirement of $5k or less, SallieMae Bank’s Money Market Account APY currently ranks second.
Looking for the best MMA rates, either nationwide or in your state? Please refer to our Money Market Accounts rates table page.
How the CD Compares
When compared to 209 similar length of term CDs tracked by DepositAccounts.com that are nationally available require a similar minimum deposit, SallieMae Bank’s 12-month CD APY currently ranks fourth.
To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.
The above rates are accurate as of 11/16/2018.