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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Survey of the Best CD Rates for May 4, 2012


Survey of the Best CD Rates for May 4, 2012

We often see rate cuts at the start of a new month, but they were more widespread this time. Many of the CD rate leaders lowered their CD rates this week. The top 3 nationally available 5-year CD rates from last week fell off my list this week. One was Michigan State University FCU which ended its CD specials. The other two were Affinity Plus FCU and McGraw-Hill FCU. Both slashed their CD rates.

In addition to credit unions, banks also lowered their CD rates. Ally Bank once again lowered its 5-year CD rate today. The yield fell 2 basis points to 1.66%. You might be able to get an extra 25 basis points for CD renewals (see post). I still keep Ally Bank on the list due to its small early withdrawal penalty of only 60 days of interest. If you're concerned about depending on an early withdrawal, Ally Bank offers a 4-year Raise Your Rate CD which gives the customer 2 chances during the term to bump up the rate to the current 4-year CD rate. This rate is a little lower than the 5-year CD rate, but the difference has been shrinking. It's now just 21 basis points lower at 1.45% APY.

In addition to Ally Bank, CD rates were cut at KeySource Commercial Bank, AloStar Bank of Commerce, Nationwide Bank and Jacksonville Bank. KeySource used to be on the list for several CD terms, but its rate cuts were so big this week, I removed it from the list.

One bit of good news came from Navy Federal Credit Union. Its Jumbo 7-year CD rate actually went up. It's now 2.75% APY which is up from 2.70%. Navy Federal also added a new 6-year term which has a Jumbo rate of 2.50% APY. It wasn't all good news. Navy Federal added new tiers, and some rates for the lower tiers went down. Even though Navy Federal is the largest credit union in the nation, not everyone can qualify for membership. It's primarily limited to those who have some military connection (see post).

Local CD Deals

There were some local CD rate cuts, but the cuts weren't as widespread as the nationwide lists.

I only added one bank to the local CD lists. It's First Republic Bank which has branches in California, Oregon, Massachusetts, Connecticut and New York. Rates on many of its CDs went up substantially. Two of its CDs are now very competitive: 2-year CD with a 1.30% APY and an 18-month CD with a 1.20% APY.

The 3.00% club remains the same with 2 credit unions in Texas offering 3-percent-plus CDs (3 credit unions if you count a 2.98% CD), 1 bank in Ohio with a 3.00% APY 10-year CD, and 1 bank in Massachusetts with a special 3.00% APY 5-year CD. That Massachusetts bank is Belmont Savings Bank, and its special CD has a $25K maximum deposit. In addition, it requires an active checking account to qualify for the 3.00% blended APY.

Long-Term CD Break Strategy

For the short-term CDs in my lists, you might notice CDs with the note "5-year CD closed after X years". These take into account the yield after the early withdrawal penalty is applied. Since Ally Bank's 5-year CD only has a 60-day interest penalty, it's still a good deal when closed early even with the recent rate cuts.

The risks of planning for early withdrawals of long-term CDs was recently highlighted by another credit union which raised the early withdrawal penalty on existing CDs. The credit union is CEFCU which is based in Illinois. I have more details in this blog post. CEFCU is now the second credit union which has raised the early withdrawal penalty on existing CDs. Last year Fort Knox FCU did the same thing (see my blog post).

Note About the CD Survey

As I described in my rate table overview, you can use our CD rate tables to find the best rates for both nationally available CDs and local CDs. This CD survey blog posts are intended to highlight nationwide CD deals that may not be apparent in the tables. For example, I'll include the post-penalty yields of a few long-term CDs.

The CD survey blog posts are also intended to highlight the local CD deals that are available in large metro areas. There are many high CD rates, but most of these are at small banks in rural areas or at small credit unions with very narrow fields of membership. In these local CD surveys, my focus is on local CD deals that are in big cities or that are available in large areas of a state.

Yields Accurate as of May 4, 2012

Under 1-Year CD Rates

  • Noteworthy Local Deals

1-Year CD Rates

  • Noteworthy Local Deals

18-month CD Rates

  • Noteworthy Local Deals

2-Year CD Rates

  • Noteworthy Local Deals

3-Year CD Rates

  • Noteworthy Local Deals

4-Year CD Rates

  • Noteworthy Local Deals

5-Year CD Rates

  • Noteworthy Local Deals

Over 5-Year CD Rates

  • Noteworthy Local Deals

Note: All rates listed above are Annual Percentage Yields (APY) which factor in compounding.

Related Pages: CD rates
Hoody   |     |   Comment #1
Not sure just what the deal is, but I assume its the usual suspects at the fed.

 But I also think its cause a lot of CD's with much better rates are coming due and they figure they will stay as it is, also just my thought, that they may be thinking that if they get rates down to as low as possible they will be able to rise them ever so slow even when the fed decides to wake out of their coma.
Anonymous   |     |   Comment #2
My CD ladder is somewhat OK for now, but it's really questionable as to whether to go 5 or 6 years, or more, on reinvesting the currently maturing CD's at such dismal rates. I may be wrong, but I have decided to avoid the longer term CD's, at this point, and simply hold the cash in a more liquid form, i.e., savings accounts and/or raise your rate type CD's. Although I understand, and have generally followed, the ladder theory, sometimes you have to do what your gut tells you to do and my gut is screaming inflation.     
Anonymous   |     |   Comment #3
I agree with #2.  I started building a CD ladder at Ally about 3 years ago, but the rates have steadily declined from over 3% to under 1.7%.  With their low withdrawal penalty, I can easily close out some low-rate CD's if/when rates start rising again.  But there's always the risk that the game will change somehow.  At under 1.7%, I really should start looking elsewhere.
Anonymous   |     |   Comment #4
Yeah I decided to take advantage of the wilshire state bank installments, at 2.28%, yeah money goes in slowly over 3 years, but I can take it out anytime I want.
miscreantURaMORON   |     |   Comment #11
This is probably what most people think of you.
Paoli2   |     |   Comment #14
I think Ken has abandoned us.  I sure hope when he returns he has found some better CD rates!