About Ken Tumin

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Higher Long-Term CD Rates at Dime Savings Bank - New Trend?


Dime Savings Bank increased the rate of its 7-year CD from 3.00% to 3.10% APY. The 5-year CD is also fairly competitive at 2.50% APY. Minimum deposit is $500. These rates are listed at Dimes deposit rates page as of 2/28/2011.

The big downside to Dime's long-term CDs is a harsh early withdrawal penalty. Here's what is stated in the disclosure:

Early Withdrawal Penalty – Principal may not be withdrawn from your Certificate before the account maturity date, unless the Bank consents to the withdrawal. If a withdrawal of principal is permitted, you may incur one of the following Bank penalties: [...] 5. Accounts with terms of 3 years or more will lose 24 month’s simple interest.

This rate is now the best that's available for a nationally available 7-year CD. The next best is the 3.00% APY 7-year CD that's available at Apple Federal Credit Union.

If you don't want to lock up your money this long, Dime is still offering a very competitive short-term CD special: a 1.65% APY 10-month CD. The downside is that it has several checking account requirements. Please see my Dime 10-month special CD review for more details. They also have a good 15-month IRA CD special.

Dime's CDs are available nationwide. Accounts can be opened online or by phone. If you don't open in a branch, they do require you to mail or fax copies of your driver's license and utility bill.

Branches are located throughout the Greater New York metro area.

Dime Savings Bank has an overall health score at DepositAccounts.com of 4 stars (out of 5) with a Texas Ratio of 7.31% (excellent) based on December 2010 data. Please refer to our financial overview of Dime Savings Bank for more details. The bank has been a FDIC member since 1943 (FDIC Certificate # 16012).

Future CD Rates?

In the last few weeks we've been seeing some better long-term CD rates and specials. Treasury yields have been rising over the last few months due to inflation expectations. There was some pull-back in last week, but the 10-year Treasury yields have been rising since October. This might be encouraging banks to offer some higher long-term CD rates.

With some rates rising and with the potential of a lot more rate hikes in the future, should one lock into a long-term CD? You might feel better keeping your cash liquid in a savings account, but if rates take a long time to rise, you're missing out on higher yields available in long-term CDs. There's no simple answer. In my post Strategy of Getting the Best Yields I reviewed issues to consider when you're shopping for CDs.

Searching for the Best CD Rates

To search for the best nationwide CD rates and the best CD rates in your state, please refer to the CD rates section of DepositAccounts.com.

Related Pages: CD rates, checking account

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  |     |   Comment #1
The 15 month, 2.5% APY, IRA CD is a pretty good deal these days. Dime agreed (via a FAX this AM) to lock the rate and term upon receipt of my IRA application (which I dutifully sent via UPS overnight minutes ago). This is noteworthy because many financial institutions will not agree to "lock" until funds are actually transferred and received. Perhaps this is another signal that at least some banks believe rates will be increasing (maybe significantly) once QE2 is over.

I'd love to see 5 year rates back at 3.5% or more as my long rungs mature.

Thus far, giving Dime's customer service "two thumbs up."

  |     |   Comment #2
Bozo - good info, thanks. Any particular reason you did not make your application by phone? I talked to a CSR last week and they indicated that I could make an application either by phone or online....for some reason they preferred not to mail me a blank aplication. They also indicated the 2.50 rate would be available until April 15, which is great since I plan to make a transfer from another IRA that matures on March 31.
  |     |   Comment #4
To: Anon

I did initially open the process by phone. However, when I received the packet, I noticed they had the wrong term (5 yr v. 15 month), so I asked for something in writing to confirm the term, rate, and availability, before I authorized the transfer. It was in their response, via FAX, that they indicated the lock upon application receipt. Sometimes I worry that the rate and term I "want" will be gone by the time the funds are actually transferred and received ("should" not being as firm as "will"). In a custodian-to-custodian IRA transfer, stuff can happen. As an example, a few years back, I had a wire transfer all set up, but nobody in the new custodian's IRA department  (which was located in a different state altogether from the main bank) had bothered to tell the main bank CSRs (with whom I was dealing) that the IRA department didn't accept wire transfers. I had to scramble, since I had no lock until the funds arrived. In another instance (different institution, different transfer), the receiving custodian claimed it had nothing from me to indicate what to do with the funds it had received, so it just plopped the funds in a share certificate account. It took numerous calls and FAXes to get them to open the CD and back-date it to when they received the funds. On that occasion, I had to re-FAX my initial written instructions to them, which they apparently had misplaced. On another occasion, again different bank, different transfer, the account rep with whom I had been dealing didn't put his name on the transfer request. When the mail room got the check, they were totally flummoxed and called me. The gist of the conversation was "what do we do with this?" So, I guess you could say I've learned not to assume anything, and get it in writing.

  |     |   Comment #5
Bozo - again, good info and thanks. So far, I have had no trouble with IRA to IRA transfers but your experiences and advice is noted and appreciated. In this case, I just hope that Dime does, in fact, leave the 2.50 rate open until April 15.
  |     |   Comment #6
To: Anon

Re: Dime Savings

Lessons learned, is all I can say. It never hurts to get what you expect to get in writing, then confirm what they said by FAXing it back to them. With a little notation, saying "agreed". When you're shipping money across the country to a bank with which you've had no prior relations, and where it is physically impossible to go to a branch and raise a complaint, it never hurts. The recent experience by one of our posters with that that "Justice" FCU in LA (see the thread in the Forum) illustrates my point.

Anyway, good luck with Dime.

Best regards,


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