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 November 24, 2013


Best Bank Account Interest Rates - Summary for Week Ending November 24, 2013

The minutes to the Fed’s October meeting were released last Wednesday, and based on the minutes, the odds that the Fed will start tapering at its December meeting have increased. However, many economists think tapering won’t start until the Fed’s January or March meeting. Tapering of the bond purchases is just the first step in a long process of Fed tightening that will eventually lead to higher rates. But the Fed is thinking of ways to keep rates low as tapering takes place.

The minutes revealed that there was discussion of reducing the interest paid to banks on excess reserves held at the Fed. Some on the Fed feel this would make it clear to the markets of its intention to keep rates low. If the Fed decides to take this path, it would be bad news to savers. According to the Financial Times, bank executives are warning that such a cut on the reserve interest rate could force them to start charging depositors. That could mean negative effective yields.

The Fed is also considering offsetting the start of tapering with reducing the unemployment threshold. Currently, the Fed wants to see the unemployment rate fall to 6.5% before it considers raising rates. That’s yet another thing that could delay higher rates.

The tapering news from the Fed minutes did push up Treasury yields a bit. Last week’s change in Treasury yields and Fed funds futures are shown below. The following numbers are based on Daily Treasury Yield Curve Rates and the CME Group FedWatch.

Treasury Yields:

  • 1-month: 0.02% down from 0.06% last week
  • 6-month: 0.10% same as last week
  • 2--year: 0.31% same as last week
  • 5--year: 1.37% up from 1.36% last week
  • 10-year: 2.75% up from 2.71% last week
  • 30-year: 3.84% up from 3.80% last week

Fed funds futures' probability of rate hike by:

  • Jan 2015: 15% down from 21% last week
  • Apr 2015: 32% down from 37% last week
  • Jul 2015: 53% down from 57% last week

For the third straight week, no banks failed so the total number of bank failures for the year remains at 23. As a comparison, at this time last year there had been 50 bank failures for the year.

Savings & Checking Account Rates

This was a quiet week for rate changes. There were no rate changes on the top savings and money market accounts in my list. However, there was one addition. Emigrant Bank started another internet bank. This new one is called MySavingsDirect, and it’s offering a 1.00% APY on all balances. As I described in my blog post, there’s not a good chance this will last over the long-run.

With the addition of MySavingsDirect, we now have 5 institutions with non-promo rates at or above 1.00%. Three of those 5 are the new iGObanking.com money market account, the SmartyPig savings account and Palladian Private Bank savings account. All of these now offer a 1.00% APY. The highest rate continues to be at Connexus Y.E.S. Money Market Account which has a top-tier APY of 1.15% for a $100K minimum balance. An important downside of this account is that it requires an active checking account and direct deposit.

Reward Checking Accounts

There was just one rate change to my list of nationally available reward checking accounts. Avidia Bank cut the yield of its reward checking account from 1.36% to 1.06%. The balance cap remains at $25K.

Avidia Bank and other banks with reward checking rates under 1.25% can’t compete with Bank of Internet USA’s Reward Checking account that pays 1.25% APY on balances up to $150K. If you’re going to settle for a low-rate reward checking account, at least pick one like Bank of Internet Reward Checking which has a large balance cap and a long history.

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

New Additions

  • MySavingsDirect (from Emigrant Bank) Savings - 1.00%

Rate Hikes:

  • None

Rate/Balance Cap Cuts:

  • Avidia Bank reward checking - 1.06% (up to $25K) [was 1.36% (up to $25K)]

Certificate of Deposit Rates

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

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

Banking News/Resources Savings/MMA - National CD Deals/Resources - National Checking/Savings/CC Bonuses Reward Checking Accounts
  • No new posts this week
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 November 24, 2013

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:
Connexus Credit Union1.15% ($100K) 1.00% ($50K) 0.75% ($20K)MMA - active chk required
EverBank1.10% (6mo intro rate) 0.61% ongoing rateMMA/Checking - account review
MySavingsDirect1.00%savings account - account review
iGObanking.com1.00% ($100K) 0.75% ($75K) 0.50% ($25K)money market account - account review
SmartyPig1.00%savings account - account review
Palladian Private Bank1.00% (min $10K)savings account
SFGI Direct0.91%savings account, account review
Incredible Bank0.91% ($2.5K min)MMA account review
Bank5 Connect0.90% (min $100)online savings account (not available for MA and RI residents)
GE Capital Bank0.90%online savings account
Sallie Mae Bank0.90%MMA account review
Union Federal Savings Bank0.90% (min $2.5K)MMA account review
Barclays0.90%Savings account review
Redneck Bank0.90% (up to $35K) 0.50% (over $35K)MMA
AmericaNet Bank0.90% (up to $35K) 0.50% (over $35K)MMA
Evantage Bank0.90% (up to $35K) 0.50% (over $35K)MMA
CIT Bank0.90% ($25K) 0.85% ($100)savings account, account review
Ally Bank0.85%MMA/savings
American Express Bank0.85%savings account, account review
Colorado Federal Savings Bank0.85% ($2.5K min)savings account, account review
Capital One 3600.85% ($100K) 0.80% ($50K)360 Checking
FNBO Direct0.85%savings account
GE Capital Retail Bank (formerly MetLife)0.85% ($25K) 0.80% ($10K)Savings/MMA
Mutual of Omaha Bank0.85% (min $25)MMA, account review
Sallie Mae Bank0.80%savings account, account review
Salem Five Direct0.80%savings, for new customers only
MyBankingDirect0.80% (min $5K)MMA
Discover Bank0.80% (min $500)savings account, account review
ableBanking0.80% (min $1K)MMA
Bank5 Connect0.76% (min $100)checking account (not available for MA and RI residents)
Bank of Internet USA0.75%MMA
Capital One 3600.75%360 savings account
Nationwide Bank0.71% (min $1K)MMA
Clear Sky Accounts0.70% (max $250K)savings account, account review
Alliant Credit Union0.70% (min $100)savings account, account review
Incredible Bank0.66% ($1K min)checking, account review
Alliant Credit Union0.65%Checking (req's elec. dep & e-stmts) account review

Reward Checking Accounts:

  • Noteworthy Accounts Available Nationwide:
Consumers Credit Union3.09% (up to $5K) 0.20% ($5K-$25K) 0.10% ($25K+)Rewards Checking
Money One Federal Credit Union3.01% (up to $10K) 0.51% ($10K+)Kasasa Cash
INOVA Federal Credit Union3.00% (up to $20K) 0.15% ($20K+)Ovation Checking
Lake Michigan Credit Union3.00% (up to $15K) 0.00% ($15K+)Max Checking
Great Lakes Credit Union3.00% (up to $10K) 0.05% ($10K+)Ultimate Checking
Belvoir FCU2.53% (up to $15K) 0.05% ($15K+)CUXcel Checking
Lee Bank2.50% (up to $15K) 0.50% ($15K+)CACHEChecking
Capital Educators Federal Credit Union2.50% (up to $10K) 0.20% ($10K+)High Yield Checking
Security Bank2.05% (up to $25K) 0.30% ($25K+)Security Bonus Checking
XCEL Federal Credit Union2.01% (up to $15K) 0.30% ($15K+)Redneck Rewards Checking
Redneck Bank2.00% (up to $10K) 0.50% (over $10K)Redneck Rewards Checking
AmericaNet Bank2.00% (up to $10K) 0.50% ($10K+)AmericaNet Rewards Checking
Evantage Bank2.00% (up to $10K) 0.50% ($10K+)Evantage Rewards Checking
ABCO Federal Credit Union1.76% (up to $25K) 0.20% ($25K+)Premiere Checking
Provident Credit Union1.76% (up to $25K) 0.11% ($25K+)Super Reward Checking
Connexus Credit Union1.75% (up to $25K) 0.31% ($25K+)Xtraordinary Checking
Community Bank of Raymore1.75% (up to $10K) 0.25% ($10K+)Rewards Checking
Community Bank of Pleasant Hill1.75% (up to $10K) 0.25% ($10K+)Rewards Checking
First Tech Federal Credit Union1.58% (up to $10K) 0.16% ($10K+)Dividend Rewards Checking
Aspire Federal Credit Union1.51% (up to $10K) 0.25% ($10K+)Kasasa Cash
West Texas National Bank1.26% (up to $25K) 0.25% ($25K+)Ultimate Checking
Heritage Bank1.26% (up to $25K) 0.10% ($25K+)eCentive Account
First New England Federal Credit Union1.25% (up to $15K) 0.10% ($15K+)extra 1% w/relationship
Bank of Blue Valley1.25% (up to $15K) 0.10% ($15K+)$1K/month debit card req (account review)
Bank of Internet USA1.25% (up to $150K) 0.00% ($150K+)Rewards Checking
BankFirst Financial Services1.25% (up to $25K) 0.15% ($25K+)Kasasa Cash
Avidia Bank1.06% (up to $25K) 0.05% ($25K+)eChecking
Legence Bank1.05% (up to $25K) 0.25% ($25K+)Kasasa Cash
North Country Savings Bank1.05% (up to $25K) 0.75% ($25K+)Advantage Checking
State Bank of Toledo1.00% (up to $25K) 0.15% ($25K+)Hometown Rewards Checking

Certificates of Deposit:

Various Deposit Account Deals

Bank Account Alternatives - NOT FDIC Insured

Duke Energy PremierNotes1.40% rate for $50K+Duke Energy PremierNotes review
Ally Financial Demand Notes1.35%Ally Demand Notes review
Ford Interest Advantage1.10% rate for $50k+Ford Interest Advantage review
GE Interest Plus1.10% rate for $50k+
Vanguard Prime Money Market Fund0.01% 7-day yield
Vanguard Tax-Exempt Money Market Fund0.01% 7-day yield
Fidelity Money Market Fund0.01% 7-day yieldreviews on Fatwallet
Fidelity Municipal Money Market Fund0.01% 7-day yield
TIAA-CREF Money Market Fund0.00% 7-day yield

Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)

lou   |     |   Comment #1
So the banks may start charging depositors for their deposits. If that happens I guess I am going to have to prepare the mattress for my money or maybe I will go to Vegas and bet it all on one hand of blackjack or just throw it all in the market. Saving is no longer a virtue, just a fool's erand for the chumps who thought prudence and self-discipline  were high-minded values.
Shorebreak   |     |   Comment #2
"According to the Financial Times, bank executives are warning that such a cut on the reserve interest rate could force them to start charging depositors. That could mean negative effective yields."

That would effectively spell the end of FDIC insured deposit accounts. Apparently the Fed is peeved that so many people are still putting money into savings accounts, certificates of deposit and other insured interest bearing accounts that they want to drive a dagger into the the heart of this prudent practice. If one doesn't want to place their funds at risk in Wall Street then punishment will follow through negative yields, which is essentially confiscation.
Anonymous   |     |   Comment #3
Aren't these the same "bank executives" that had to be bailed out by the taxpayers?
Shorebreak   |     |   Comment #4
In The Future, You May Have To Pay The Bank To Hold Your Money

The economy is stuck in a weak recovery and unemployment remains high, but the Federal Reserve long ago exhausted the normal tool it uses to spur economic growth.

Now, it is considering a policy change that could lead banks to charge depositors negative interest rates.

lou   |     |   Comment #5
I want to dismiss the article because a scenario where depositors are charged at fee for their savings seems so preposterous, but then who would have predicted a zero rate for the last five years and the FED buying our public debt with monopoly money. I have to admit the FED forcing banks to impose a negative interest rate on savings is something we should probably take seriously.
scottj   |     |   Comment #6
Really would not be that bad for me to put all my money under my mattress. Since I dont work will look very poor. Would get free healthcare, welfare, foodstamps and host of other Government freebies. Is probably part of their plan? get as many on the Government dole as possible  
Anonymous   |     |   Comment #7
In a sense, banks have been charging some depositors to hold their money already.  Inactive account fees, even on accounts with thousands of dollars on deposit.  The banks really profit off those customers.  Use their money virtually for free and also charge them if they do not make another deposit or withdrawal on that account.  Talk about "biting the hand hat feeds you".........