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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Best Bank Account Interest Rates - Summary for Week Ending September 17, 2011


Best Bank Account Interest Rates - Summary for Week Ending September 17, 2011

Inflation increased more than expected in August according to the Labor Department's CPI report that was released on Thursday. In the last year the CPI is up 3.8% which is the largest year-over-year gain since September 2008. This inflation news should support the inflation hawks on the Fed when they meet next week for a 2-day FOMC meeting. However, as pointed out by this CNNMoney article, the inflation hawks on the Fed are outnumbered by the unemployment hawks. Since the economic growth continues to be weak, we may see further stimulus from the Fed. Instead of QE3, it's more likely to be a policy with the informal name Operation Twist which will shift the Fed's holding from short-term to long-term bonds.

Treasury yields finally stopped falling this week. Inflation news and a rising stock market may have helped to push up yields a little. The summary below shows how the yields went up this week. The probabilities of future Fed rate hikes also went up a little. However, these remain very low due to the Fed's mid-2013 pledge (Numbers are based on Yahoo bond rate data and the CME Group FedWatch)

Treasury Yields:

  • 5--year: 0.91% up from 0.80% last week
  • 10-year: 2.05% up from 1.91% last week
  • 30-year: 3.31% up from 3.25% last week

Fed funds futures' implied probability for a higher rate by:

  • Jun 2012: 1.2% down from 2.95% last week
  • Dec 2012: 7.2% up from 6.5% last week
  • Mar 2013: 12.1% up from 10.1% last week

There were no bank failures this week. A Friday that's free of bank failures has become more common this year as the pace of bank failures has declined. The total number of bank failures for 2011 remains at 71. As a comparison, last year at this time there had been 125 bank failures for the year.

Savings & Checking Account Rates

The savings and checking accounts on my list below held steady with their rates this week. I would like to say we are at a bottom, but with the Fed's mid-2013 pledge, the situation that we have seen over the last two years may continue. For example, since last year, Ally Bank's savings account rate has fallen 26 basis points, Discover Bank has fallen 25 basis points and Alliant Credit Union has fallen 20 basis points.

If you had enough of these rate cuts, Capital One's 1-year rate guarantee on its Interest Online Checking account should appeal to you. They're guaranteeing 1.01% APY for up to $100K for one year (see my review). This is not quite a nationwide deal. The online checking account isn't available in areas where Capital One has branches

If you prefer the highest rate instead of a rate guarantee, Bank of Internet's new division, UFB Direct, is the best choice. It currently offers the highest savings account rate without a balance cap (1.30% APY). I did another review of this account yesterday. One important thing to note about UFB Direct is that it has no relationship to the old UFB Direct. In my updated review I looked at UFB Direct's bank-to-bank ACH transfer service. In short, the limits are disappointing, but you should be able to initiate ACH transfers from your other bank.

Reward Checking Accounts

This was another week with no rate cuts on the reward checking accounts on my list below. It should be noted that I'm only listing the top reward checking accounts that are available nationwide. This is now a small list compared to the banks and credit unions which limit their reward checking accounts to residents in their local areas.

If you look at all of the reward checking accounts, rates and balance caps continue to be cut. Last June there were 30 reward checking accounts that offered yields of at least 4.00% for balances up to at least $25K (the 4 percent club). I'm afraid that number is now down to 12.

In addition to rate cuts, we are seeing several banks cutting their balance caps. Many banks have been lowering the cap to $10K. That means the top rates will only apply to balances up to $10K. The latest bank to announce such a change is TransPecos Banks in Texas. It announced that effective October 15, the balance cap will be reduced from $25K to $10K. Other institutions that have recently cut balance caps like this include Murphy-Wall State Bank & Trust in Illinois and Neighbors Federal Credit Union in Louisiana. To stay on top of these changes, keep an eye on the reward checking sub-forum (hat tip to 51hh for all the postings).

To find the best rates and balance caps in your state, please refer to the reward checking rate table. If you're new to these tables, my rate table guide should be useful, and if you're new to reward checking, my blog post, 10 Common Traits of High-Yield Reward Checking, should also be useful.

Rate Hikes:

  1. None

Rate Cuts:

  1. None

Certificate of Deposit Rates

My recap of CD rate changes and the list of CD deals will now be in my Friday survey of the best CD rates. My Saturday recaps will now focus on banking news of the week and liquid accounts.

Recap for the Week - Links to This Week's Posts

Banking News/Resources Savings/Checking Accounts - Nationwide CD Deals - National Checking/Savings/CC Bonuses Reward Checking Accounts
  • No new posts
CD and Money Market Deals - Local Posts from Previous Weeks The rates listed below are based on Annual Percentage Yield (APY). No minimum balances are required unless noted. MMA next to the rates indicate a money market account. Most MMAs have check writing and ATM cards. Online savings accounts usually lack both of these. Previous weekly summaries are available at this page.

Rates as of September 17, 2011

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:

Reward Checking Accounts:

  • Noteworthy Accounts Available Nationwide:

Certificates of Deposit:

Various Deposit Account Deals

Bank Account Alternatives

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)
Super Saver
Super Saver   |     |   Comment #1
I can't wait for CD rates to reflect that actual inflation that is being masked by the Fed actions.  The premium on my TIPS investments sure indicate that inflation is higher than what's being officially reported.
Anonymous   |     |   Comment #2
Of course it is... but I wouldn't hold my breath on higher CD rates.

Anonymous   |     |   Comment #3
Eventually, CD rates, and other interest rates, are bound to rise. The problem, however, is that rates will be permitted to rise by the Fed only when the inflation rate has gotten so completely out of hand that the Fed and can no longer hide it from us by imaginary accounting tricks. If the Fed and politicians would simply stand back and let the free market work it out, we would be just fine. Their attempts to artifically manipulate the economy have been a dismal failure but, to date, the powers that be won't admit it, and they never will. Meanwhile, the hole is becoming deeper and deeper and they continue to shovel. JMHO  
georgia on my mind
georgia on my mind   |     |   Comment #4
no bank failures this week ??
Anonymous   |     |   Comment #5
The United States Senate Federal Credit Union has some very competitive yields on their CDs. Their highest is 5 year yielding 3.3% with 180 day early withdraw penalty. Any member of the US Capitol Historial Society can join. I joined the society yesterday by paying $35 and opened the account that very same day. Exceptional customer service too. They just started accepting members (vs. employees) of the US Historical Society. I was the second person to apply as a non-employee so spread the good news.

#8   |     |   Comment #11
#5 Thanks for all the added info.  The credit union called me today and were very helpful. I will call them in a few days and ask them how they handle returning the money when the CD matures.  I could not find a rating for them on Bankrate which surprised me.  I have to make sure I always deal with the highest rating CUs and banks.   I was able to find a rating for them on Bauers which was very high.   It is very helpful that they have a "shared branch" in my neighborhood.  BTW, I was told I have to fax them a photo ID and also give a copy when and if I open an account at my shared branch.  Did you have to do this?  Thanks for all the helpful info.
Anonymous   |     |   Comment #12
#11 - Good catch, thanks...not being rated on Bankrate is a VERY important fact. 
Anonymous   |     |   Comment #15
#5 again: I would not have found this, had it not been for ken's site, although I too was surprised he has not reviewed it. It comes up here under Virginia 5 year CD's 100,000 http://www.depositaccounts.com/cd/5-year-cd-rates.html#P|8|1000000|false,false,true,true,true,true,true|VA|EstimatedEarnings%20desc

Does anyone know how to post a message that ken would see?
Anonymous   |     |   Comment #17
#5 I just found his email address where he was giving it to a poster on the other  site.  It's "ken@depositaccounts.com" .  He was also explaining to the poster how to send him a PM (private message).  If you go to that other site you can find his post giving this info.  It's on the Forum site where other posts are listed. 
Anonymous   |     |   Comment #6
Anony#5:  How did you get to join the US Historical Society?  I called the 800 number and the rep had no idea about any one but members of certain groups being members.  She said for me to go to a certain page which would give me a list of Select Employment places one needs to belong to but all I found was a form to fill out.  Is there a special phone number you called to join the way you did?  Any info you can share will be appreciated.  Thanks!
Anonymous   |     |   Comment #7
Anony #5:  I found the info and the phone number for the Society.  It is as you posted and the $35.00 is an annual fee.  What I like about this CU is that it has numerous Shared Branches in practically all states. I found two shared branches right in my own neighborhood!  Thank you so much for sharing this with us.  BTW, how did you find out about the 5 year CD rate?  I could not find it listed on the webpage.  Maybe I looked in the wrong area.  Thanks again!
Anonymous   |     |   Comment #8
Anony #5:  It was too good to be true for my needs.  I just found out that the Shared Branches of the CU will not do CDs.  Only regular deposits and withdrawals.  I guess the CDs would have to be done through the mail.  I was hoping to do something locally and in person.  I will still keep it on my "list" for possible places to use if I can't do as well in person.
Anonymous   |     |   Comment #9
This is #5 again. All I did is go to the US Historical Society's homepage and I paid the $35 via their website. I did not have to go anywhere! Once you pay, you are a member. And then all you do, is print the email receipt that they send you thanking them for the donation and include it with the paperwork the credit union wants. I first called and spoke with the credit union rep to ensure that they would accept this since I was about to join the same day and they said they would.
Anonymous   |     |   Comment #10
This is #5 again responding to #8: I happen to live close by so I will open it at the branch. However if they were not close I would mail it. I have opened several that way with no problems. The only thing to be careful is when you close it. In that case never ever allow them to send the check regular mail which is the practice of most banks. If it gets losts you have to jump through hoops while your money is losing interest because the bank won't issue a check right away. So if you can' close it personally ask them to wire it or fed ex it. And if you don't want to pay for that, then make sure you can do it in person.
Anonymous   |     |   Comment #13
Not sure why has Ken has missed US Senate around 3.3% or so while he has been touting Ally around 2.2% ?
Anonymous   |     |   Comment #14
This is #5: I had to fax them a copy of my ID but they also wanted me to be personally identified by another financial institution. So I had to go to my bank which is only a block away present my ID and call them to tell them I am there. They got the bank's information and 5 minutes later they called and confirmed my identity. They said that they do this if you don't go to a branch.

It is a 5 star rated CU: http://www.depositaccounts.com/banks/united-states-senate-cu.html
Anonymous   |     |   Comment #16
I just read in another post where Ken was telling a poster if he didn't want to post his info "to email me" but he didn't put the email address.  I could not find one for him.  However, why don't you start a new thread title which would attract his attention.  I think we can do this.
Anonymous   |     |   Comment #18
Note:  Click on "Forum" at the top of this Heading and look for "Site Feedback" "How to Contact Ken".  It gives all the info you may need.  It's not on this Blog but the other.
Anonymous   |     |   Comment #19
Just a note to add that I finally found a way to find the US Senate FCU on Bankrate.  Bankrate just gives it 3 stars.  It always amazes me how Bauers can give a bank or CU 5 stars and Bankrate can be that much lower.  Maybe they use different dates for their information.  They never seem to give the same ratings from my research.
Anonymous   |     |   Comment #20
Re: USSFCU, I was told that the early withdrawal penalty(at least for the 5 year) is 360 days interest
mariafalter   |     |   Comment #21
The penalty is 120 days for 1-2 years, 180 days for 3 years, and 360 days for 4 years and longer.
Anonymous   |     |   Comment #22
I was told several times last week that the early withdrawal penalty for the 5 year CD is 6 months.  First the rep said 360 days then she rechecked and returned to say it was 6 months.  Before I do business with them, I will want to verify the EWP as 6 months.  I can't find this particular CU listed on ANY CU rates sites I check out for best rates.  It is one of the best rates going for 5 years at this time to my knowledge yet no one seems to be listing it.  Does anyone know if there is some problem with this CU that we need to be aware of before doing business with them?  I even tried searching "Best 5 yr CD rates for CU in Virginia" where they are located and they aren't included.  Thanks for any info you can share about this CU.
Anonymous   |     |   Comment #23
People, I decided to email Ken a few hours ago for some help with the United States Senate FCU and to my amazement, he already replied to me.  He has already added it to his list.  You can find it by filtering "Virginia" and there it is at the top!  He also added his regular info about it for us.  Wow!  If Obama and the people in Washington took care of requests this quickly, we would be back to having a GREAT nation again!  Thank you, Ken for your dedication and helping us find those "unfindable" CDS! 
Paoli   |     |   Comment #24
People, I think #22 is correct about the EWP for US Senate FCU.  I called this morning to verify it before I went through all the procedures to become a member etc.  I was told by the rep it was most definitely 360 days for the 5 year CD early withdrawal penalty.  The 6 mos EWP was only for shorter term CDs.  Well.....I got in my car with DH and we took off down the road to find another bank which is on Ken's list for a lesser interest rate but with the 6 month EWP.  Peace of mine is worth as much to me as money so unless the US Senate gives the normal 6 mos EWP for the 5 year CD, I do not intend on doing business with them.  If the earlier poster I think #5 has the 5 year CDs, he might want to check them out to see if they actually indicate a 6 month EWP.  Maybe he got a better deal due to the amount he was investing with them.  Just wondering what is going on with this.  Was very disappointed to get this news from the rep today but if she was wrong, I do not like doing business with an institution which doesn't train their reps to give correct info if that is the case.  Just my personal opinion.
Anonymous   |     |   Comment #25
People:  I just received a reply to an email I sent to the US Senate FCU re: EWP.  First of all, I wanted to see it in writing and it said: "360 days of dividends paid and accrued on the withdrawal for terms of 5 years".  However, I have never in over 45 years of purchasing CDs seen it figured out the way the rep wrote in my email.  It seems it depends upon how soon you cancel as to what your real penalty will be. If you cancel within 3 to 5 years of opening, the penalty is 360 days of dividends.

Sorry but as I replied to her.  I prefer an institution which makes it more clear as to how I will be penalized so I took my business elsewheres.