SallieMae Bank has been busy increasing rates since beginning of the year. There's been enough rate change activity to warrant 15 blog posts and Forum posts about the Money Market account, the High-Yield Savings account, and several CDs. While the individual rate increases haven’t been wow-worthy on their own, the cumulative effect is keeping SallieMae Bank at the front of the rates peloton.
Money Market Account
The Money Market Account (MMA) continues to be SallieMae Bank’s most competitive deposit account, offering 1.90% APY. Since the beginning of the year, a total of 58 bps have been added to the MMA’s APY in six rate increases. This week's rate increase added 15 bps.
The fee-free MMA can be opened with as little as $1. There is no minimum or maximum balance requirement for SallieMae Bank’s MMA, however,
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 CIT Bank's Money Market Account (1.85% APY) or Capital One's 360 Money Market (1.60% APY). Checks are provided at no cost if they are ordered when the MMA is opened; any check orders placed after account opening are $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 is unique, in that its high-rate account is the MMA (1.90% APY), rather than the High-Yield Savings account (1.75% APY). The MMA and High-Yield Savings are structured similarly (no tiers or fees), but the MMA's check writing ability is an important difference: when withdrawing a large amount, the money will keep earning a top rate until the check has posted and settled. As one of my colleagues pointed out, “that’s often a reason banks offer higher rates on their savings account, rather than on their MMAs.”
Complete details about the MMA (including information concerning POD accounts) are available on Deposit Account Terms and Conditions Agreement page.
The High-Yield Savings now earns 1.75% APY on all balances. Since January, the High-Yield Savings has had five rate increases, adding a total of 75 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 recently raised the rate on its 24-month CD to 2.80% APY. The minimum deposit is $2.5k, with no stated balance cap. While SallieMae Bank has been offering a couple select CDs since 2010, eight additional CDs were added to the product in July 2017, including the 24-month CD. In the past year, the 24-month CD has gained 115 bps, making it the most competitive CD SallieMae Bank offers.
As stated on SallieMae Bank’s Certificate of Deposit FAQs page, the Early Withdrawal Penalty (EWP) reads as follows:
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 his continued Forum posts on SallieMae Bank.
Headquartered in Salt Lake City, Utah, SallieMae Bank is an internet-only 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 1.71% (excellent) based on March 31, 2018 data. In the past year, SallieMae Bank has increased its total non-brokered deposits by $1.15 nillion, an excellent annual growth rate of 15.92%. Please refer to our financial overview of SallieMae Bank (FDIC Certificate # 58177) for more details.
If I say "SallieMae," chances are you would think of 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 $23 billion, with more than $16.9 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 are not limited by a low balance cap, SallieMae Bank’s Money Market Account APY currently ranks second.
|Interest Rate||Account Name||Credit Union/Bank|
|2.01% APY||eMoney Market (no min/no max)||Virtual Bank|
|1.90% APY||Money Market Account (no min/no max)||SallieMae Bank|
|1.85% APY||Money Market Account ($100 min/no max)||CIT Bank|
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 the 196 nationally available similar length of term CDs tracked by DepositAccounts.com that require a similar minimum deposit, SallieMae Bank’s 24-Month CD APY currently ranks third.
|Interest Rate||CD Length of Term||Credit Union/Bank|
|2.90% APY||24-Month Share Certificate||CommunityWide Federal Credit Union|
|2.85% APY||25-Month CD||USALLIANCE Financial|
|2.80% APY||24-Month CD||SallieMae Bank|
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 7/4/2018.