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Best Savings and Checking Rates - Recap for August 5, 2014


Best Savings and Checking Rates - Recap for August 5, 2014

As I mentioned yesterday, last week’s Fed meeting had little impact on the expectations for the timing of rate hikes. The first rate hike is likely to be sometime in 2015 if the economy continues to improve. How much will the economy have to improve for the Fed to hike rates? If the inflation hawks have their way, it won’t take a whole lot of improvement. One of the Fed inflation hawks, Jeffrey Lacker, said that "investors may be underestimating the pace at which the Federal Reserve will raise interest rates over the next two years." However, the majority on the Fed are inflation doves (including the Chair Janet Yellen), and they will likely want to see a lot more improvement in the economy and in the unemployment rate before they start to hike rates.

A useful overview of what inflation doves think can be seen in this Huffington Post article, "Inflation Hawks: The Job Killers at the Fed". The author of this article suggests that the Fed should wait for the unemployment rate to fall to 4% before it starts to raise interest rates. Otherwise, it claims millions of jobs would be at risk. Inflation doves don’t seem to mind risking high inflation if there’s even a tiny chance of reducing the unemployment rate. Hopefully, no one at the Fed is this much of an inflation dove.

Treasury yield changes were mixed last week while the Fed fund futures’ probabilities went down slightly indicating a slight decrease in the chance of a rate hike next year. Below is a summary of the changes. The following numbers are based on Daily Treasury Yield Curve Rates and the CME Group FedWatch.

Treasury Yields:

  • 1-month: 0.01% down from 0.03% last week
  • 6-month: 0.05% down from 0.06% last week
  • 2--year: 0.47% down from 0.53% last week
  • 5--year: 1.67% down from 1.69% last week
  • 10-year: 2.52% up from 2.48% last week
  • 30-year: 3.29% up from 3.24% last week

Fed funds futures' probability of rate hike by:

  • Jan 2015: 8% down from 9% last week
  • Apr 2015: 33% down from 37% last week
  • Jul 2015: 71% down from 77% last week
  • Oct 2015: 92% down from 95% last week

Savings & Checking Account Rates

Last week was another quiet week in the savings and money market accounts that I track below. There was only one rate change, and I’m happy to report it’s a rate hike.

GE Capital Bank raised its online savings account yield from 0.90% to 0.95%. This internet bank has only been around for just over a year, but it’s a large bank with lots of resources. That should put pressure on the other internet banks to keep up. Hopefully, we’ll start seeing some more internet banks joining the 1% club.

It has been awhile since we’ve seen an increase in the 1% club. The number of institutions offering a non-promo 1% savings or money market account remains at five. Out of these five, the accounts at Connexus Credit Union and SmartyPig have the longest history of top rates. Note, I exclude EverBank, Citizens State Bank and Salem Five Direct.

Reward Checking Accounts

Last week was also a quiet week for the nationally available reward checking accounts. There was just one change, and unfortunately, that was a rate cut.

Provident Credit Union reduced the top yield on its Super Reward Checking from 1.76% to 1.56%. Fortunately, the balance cap remains the same at $25,000.

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 reward checking, please refer to my blog post, 10 Common Traits of High-Yield Reward Checking.

Certificate of Deposit Rates

I’ve gone back to publishing my CD survey as a separate post. Please refer to my survey of the best CD rates. This recap will focus on banking news of the week and liquid accounts.

Rates as of August 5, 2014

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:
EverBank1.40% (6mo intro rate) 0.61% ongoing rateMMA/Checking - account review
Connexus Credit Union1.15% ($100K) 1.00% ($50K) 0.75% ($20K)MMA - active chk required
Citizens State Bank (FL)1.06% ($10K) 0.75% ($2.5K) 0.50% ($250+K)MMA
Citizens State Bank (FL)1.06% ($10K) 0.75% ($2.5K) 0.50% ($250+K)Internet Savings
Quorum Federal Credit Union1.05%HighQ Savings Account
SFGI Direct1.01%savings account, account review
MySavingsDirect1.00%savings account - account review
SmartyPig1.00%savings account - account review
Salem Five Direct1.00%savings, for new customers only
Synchrony Bank (formerly GE Capital Retail Bk) 0.95%Savings
Incredible Bank0.95% ($2.5K min) MMA account review
CIT Bank0.95% ($25K) 0.90% ($100) savings account, account review
GE Capital Bank0.95%online savings account
Bank5 Connect0.90% (min $100) online savings account (not available for MA and RI residents)
Sallie Mae Bank0.90%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
Palladian Private Bank0.90% (min $10K)savings account
iGObanking.com0.90% ($100K) 0.90% ($75K) 0.90% ($25K)New accounts and new money only, account review
Ally Bank0.87%savings
First Trade Union Bank0.85% ($2.5K)FT High-Yield Savings, account review
Union Federal Savings Bank0.85% (min $2.5K)MMA account review
Ally Bank0.85%MMA
Discover Bank0.85% (min $500) savings account, account review
Colorado Federal Savings Bank0.85% ($2.5K min)savings account, account review
Synchrony Bank (formerly GE Capital Retail Bk)0.85%MMA
Mutual of Omaha Bank0.85% (min $25) MMA, account review
TIAA Direct0.80%high yield savings account
Capital One 3600.80% ($100K) 0.75% ($50K)360 Checking
American Express Bank0.80%savings account, account review
Sallie Mae Bank0.80%savings account, account review
Digital Credit Union0.80% ($100K) 0.65% ($50K)MMA
MyBankingDirect0.80% (min $5K) MMA
ableBanking0.80% (min $250) MMA
Discover Bank0.80% (min $100K) 0.70% ($2.5K) MMA, account review
Bank5 Connect0.76% (min $100) checking account (not available for MA and RI residents)
FNBO Direct0.75%savings account
Bank of Internet USA0.75%MMA
Capital One 3600.75%360 savings account
Clear Sky Accounts0.70% (max $250K) savings account, account review
Alliant Credit Union0.70% (min $100) savings account, account review
Nationwide Bank0.66% (min $1K) MMA
FNBO Direct0.65%checking account
Alliant Credit Union0.65%Checking (req's elec. dep & e-stmts) account review
Incredible Bank0.59% ($1K min) checking, account review

Reward Checking Accounts:

  • Noteworthy Accounts Available Nationwide:
Consumers Credit Union5.09% (up to $10K) 0.20% ($10K-$25K) 0.10% ($25K+)Rewards Checking - $1K debit card requirements
Consumers Credit Union4.09% (up to $10K) 0.20% ($10K-$25K) 0.10% ($25K+)Rewards Checking - debit and cc requirements
Consumers Credit Union3.09% (up to $10K) 0.20% ($10K-$25K) 0.10% ($25K+)Rewards Checking - debit with NO cc requirements
INOVA Federal Credit Union3.00% (up to $20K) 0.15% ($20K+)Ovation Checking (not available to PA residents)
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
American Bank & Trust2.51% (up to $10K) 0.26% ($10K+)Kasasa Cash
Lee Bank2.50% (up to $15K) 0.50% ($15K+)Kasasa Cash
Capital Educators Federal Credit Union2.50% (up to $10K) 0.20% ($10K+)High Yield Checking
Flanagan State Bank2.25% (up to $10K) 0.25% ($10K+)Kasasa Cash
Security Bank2.05% (up to $15K) 1.00% ($15K-$25K) 0.30% ($25K+)Security Bonus Checking
XCEL Federal Credit Union2.01% (up to $15K) 0.30% ($15K+)Kasasa Cash Checking
ABCO Federal Credit Union1.76% (up to $25K) 0.20% ($25K+)Premiere Checking
Connexus Credit Union1.75% (up to $25K) 0.25% ($25K+)Xtraordinary Checking
First Tech Federal Credit Union1.58% (up to $10K) 0.16% ($10K+)Dividend Rewards Checking
Provident Credit Union1.56% (up to $25K) 0.08% ($25K+)Super Reward Checking
Aspire Federal Credit Union1.51% (up to $10K) 0.25% ($10K+)Kasasa Cash
First American Bank1.50% (up to $15K) 0.15% ($15K+)Everyday Rewards Checking
Community Bank of Raymore1.50% (up to $10K) 0.10% ($10K+)Rewards Checking
Community Bank of Pleasant Hill1.50% (up to $10K) 0.10% ($10K+)Rewards Checking
Redneck Bank1.50% (up to $10K) 0.50% (over $10K+)Redneck Rewards Checking
AmericaNet Bank1.50% (up to $10K) 0.50% ($10K+)AmericaNet Rewards Checking
Evantage Bank1.50% (up to $10K) 0.50% ($10K+)Evantage Rewards Checking
West Texas National Bank1.26% (up to $25K) 0.25% ($25K+)Ultimate Checking
Heritage Bank1.26% (up to $25K) 0.10% ($25K+)eCentive Account
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) 0.37% ($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
First New England Federal Credit Union1.01% (up to $15K) 0.10% ($15K+)extra 1.01% w/relationship

Certificates of Deposit:

Bank Account Alternatives - NOT FDIC Insured

Ally Financial Demand Notes1.25% rate for $50k+Ally Demand Notes review
Duke Energy PremierNotes1.25% rate for $50K+Duke Energy PremierNotes review
Ford Interest Advantage1.05% rate for $50k+Ford Interest Advantage review
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

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

Anonymous   |     |   Comment #1
"The author of this article suggests that the Fed should wait for the unemployment rate to fall to 4% before it starts to raise interest rates."

That would mean permanent ZIRP. The days of unemployment at 4% is bygone just like black & white television.
Anonymous   |     |   Comment #2
Citizens State Bank has the worst website I have ever encountered.  It is impossible to open a savings account!!!