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Best Bank Account Interest Rates - Summary for February 20, 2018

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Best Bank Account Interest Rates - Summary for February 20, 2018

Last Wednesday’s release of the Consumer Price Index (CPI) for January showed that inflation had risen more than economists had expected. The core CPI that excludes food and energy increased 0.3% from the previous month. The consensus was 0.2%. This inflation news makes it very likely that the Fed will go forward with a rate hike at its March 20-21 meeting. The question about whether it’s enough to move the Fed to speed up its pace of rate hikes is not so clear. Economist Tim Duy had this to say in his Fed Watch Blog:

At this point, the inflation numbers justify maintenance of their existing forecast. They do not, however, justify raising the forecast. Assuming the Fed behaves like last year, they will not over-react to higher than expected inflation if they think it is transitory within the context of their forecast.

The next monthly CPI release will be March 13, about a week before the next Fed meeting. So if inflation continues to surprise on the upside, we may see signs from the Fed after its March meeting that four rate hikes in 2018 (instead of three) may be justified.

We may get a little more insight into what the Fed and the new Fed Chair, Jerome Powell, are thinking about inflation when the minutes of the Fed’s January meeting are released on Wednesday afternoon. Also, we may learn more about Fed Chair Powell’s views next week when he testifies before the House Financial Services and the Senate Banking committees.

The rise in inflation did impact the Fed funds futures. The odds of a rate hike at the March 20-21 meeting as indicated by the Fed funds futures are now 83.1% which are up from 77.5% from last week. The stock market turmoil may have added some uncertainty. Last November, a month before the December Fed meeting, the Fed funds futures were showing odds of 100% for a December rate hike. The odds that the federal funds rate will be at least 50 bps higher in June also increased. They’re up to 62.8% (from 56.7% last week.)

Inflation news also impacted Treasury yields. All Treasury yields were up from last week. Most notably, the yield of the 2-year note increased 15 bps to 2.25%. According to this CNBC article, this is “its highest level since Sept. 22, 2008, when it yielded as high as 2.263 percent.” I also added the 1-year note to the list of yields below since there was another noteworthy milestone. The 1-year yield topped 2% this week. Today’s closing value was 2.01%, up from 1.95% last week and up from 0.82% one year ago.

In addition to providing insights on future interest rates, Treasuries can be an alternative to CDs. During the zero interest rate environment years, CDs from internet banks and credit union had a large yield advantage over Treasuries even when the tax advantages of Treasuries were considered. Today, Treasuries are much more competitive. For more discussion on the pros and cons of Treasuries Notes compared to CDs, please refer to this DA Forum thread.

The following numbers are based on Daily Treasury Yield Curve Rates and the CME Group FedWatch.

Treasury Yields:

  • 1-month: 1.39% up from 1.34% last week (0.50% a year ago)
  • 6-month: 1.87% up from 1.80% last week (0.66% a year ago)
  • 1-year: 2.01% up from 1.95% last week (0.82% a year ago)
  • 2--year: 2.25% up from 2.10% last week (1.21% a year ago)
  • 5--year: 2.65% up from 2.54% last week (1.92% a year ago)
  • 10-year: 2.88% up from 2.83% last week (2.42% a year ago)
  • 30-year: 3.15% up from 3.11% last week (3.03% a year ago)

Fed funds futures' probabilities of future rate hikes by:

  • Mar 2018 - up by at least 25bps: 83.1% up from 77.5% last week
  • Jun 2018 - up by at least 25bps: 95.6% up from 93.7% last week
  • Jun 2018 - up by at least 50bps: 62.8% up from 56.7% last week

Savings and Money Market Account Rates

The above graph shows the rate trends of the average savings account rates. These average rates are based on all the rate data that we have collected over the years. This is an interactive graph. You can choose the look-back period (from 3 months to 5 years). As you can see in the graph, average savings account rates are rising slowly. They are still below the average from five years ago.

In the last month, rate hikes at internet banks have slowed. That makes sense since you would expect January to be an active month after the Fed’s December rate hike. Below are the noteworthy savings and money market account rate hikes that have occurred in the last two weeks:

  • All America Bank/Redneck Bank Mega MMA (+25 bps to 1.75% APY for up to $50k)
  • Sallie Mae Bank MMA (+5 bps to 1.50% APY)
  • Capital One 360 MMA (+10 bps to 1.50% APY)
  • Ally Bank SA (+10 bps to 1.45% APY)

The rate hikes at All America Bank and its sister division, Redneck Bank, are scheduled to take effect on Wednesday, February 21. Their Mega Money Market Account will earn 1.75% APY for balances up to $50k. That’s up from 1.50% APY for balances up to $35k.

The 1.50% APY is growing in popularity. The latest to reach this yield is Capital One’s 360 Money Market and Sallie Mae Bank’s Money Market Account.

Without a balance cap, ableBanking’s Money Market Savings account continues to be the rate leader with a 1.70% APY on all balances. There’s a $250 minimum opening balance.

Colorado Federal Savings Bank continues to be in second with its Premier Savings Account that offers 1.65% APY for balances of at least $50k.

Reward Checking Accounts

There continues to be little change to my list of nationally available reward checking accounts. The only change will be rate changes at All America Bank and Redneck Bank. The same day that the Mega Money Market rates are scheduled to change (Feb 21), their Rewards Checking Account rates are scheduled to increase 25 bps to 2.25% APY. Unlike the Mega Money Market accounts, no changes in the balance cap were announced. They currently have $10k balance caps. The portion of the balance above $10k will earn a much lower rate.

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, Overview of Reward Checking and Our Reward Checking Table.

Certificate of Deposit Rates

I’m now 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.

CD Deals: I just wanted to include this reminder of a few noteworthy CD deals that are available.

NASA Federal Credit Union recently came out with a very competitive 11-month CD special that earns 2.25% APY with a minimum deposit of $20k. This is currently the highest rate for terms equal to or close to one year. Please refer to this blog post and the comments in the post for more details.

For 18-month CDs, two internet banks are tied for the highest rate. Popular Direct just recently increased their 18-month CD rate to 2.30% APY. This matches Live Oak Bank’s 18-month CD rate that has been available since January 31st. Please refer to this Live Oak Bank 18-month CD review and this Popular Direct 18-month CD review for more details.

Navy Federal Credit Union continues to offer a special 32-month IRA CD with a 2.75% APY and a $250k maximum balance. There’s also a special 15-month CD with a 2.25% APY and a $50k maximum balance. As is typical with recent Navy Fed special CDs, these allow add-on deposits. Please refer to this blog post for more details.

We now have two institutions offering 3% 5-year CDs that are available nationwide. Connexus Credit Union was the first with a 5-year CD that earns 3% APY. Please refer to this blog post for more details. Mountain America Credit Union was the second with its 3% APY 5-year CD (please see blog post.) We actually have three institutions in this “club” if you count Idaho Central Credit Union. It came out with a promotional 60-month CD that earns 3.00% APY. If you don’t live in Idaho, there’s an indirect way to qualify for membership as I described in this blog post.

UPDATE 2/21/18: Freedom Credit Union is offering a special 36-month CD and IRA CD with a 3.04% APY. Readers have reported that Freedom Credit Union is accepting ACC membership without PA residency. This allows people in any state to qualify for credit union membership. Please refer to this this blog post for more details.

Rates as of February 20, 2018

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:
InstitutionRatesNotes
All America Bank1.75% (up to $50k), 0.50% ($50k+)Mega Money Market Account - Account review
Redneck Bank1.75% (up to $50k), 0.50% ($50k+)Mega Money Market Account
ableBanking1.70% ($250 min)Money Market Savings - Account review
Colorado Federal Savings Bank1.65% ($50k+) Premier Savings (New customers) - Account review
United Bank (MA)1.61% ($500k max, guaranteed for 6mo) Advantage Money Market, Not available in all states, Account review
MutualOne Bank1.61% ($250k max)Online Statement Savings - Account review
DollarSavingsDirect1.60% (no min)Dollar Savings Account - Account review
Live Oak Bank1.60% ($5 million max) Savings Account - Account review
UFB Direct1.60% ($5k min)High Yield Money Market - Account review
PurePoint Financial1.60% ($10k min)Online Savings - Account review
Synchrony Bank (formerly GE Capital Retail Bk) 1.55%High Yield Savings - Account review
CIT Bank1.55%Premier High Yield Savings - Account review
Incredible Bank1.55% ($25k+), 1.21% ($2.5k), IncredibleBank Savings - Account review
SFGI Direct1.51%Savings account - Account review
Northern Bank Direct1.51% ($250k max) Money Market - Account review
Sallie Mae Bank1.50%MMA - Account review
Marcus by Goldman Sachs1.50%High-Yield Online Savings Account - Account review
My eBanc1.50%Super Saver - Account review
Barclays1.50%Online Savings - Account review
Salem Five Direct1.50% eOne Savings, for new customers only Account review
Popular Direct1.50% ($5k min)Popular Direct Exclusive Savings - Account review
Nationwide Bank1.50% ($10k+), 1.15% APY (up to $10k)Money Market - Account review
Capital One1.50% ($10k+), 0.85% (up to $10k)360 Money Market - Account review
MyBankingDirect1.50% ($25k+), 1.35% ($5k+), 0.25% (less than $5k) Money Market
iGObanking.com1.50% ($25k min) MMA, New accounts and new money only, Account review
Northpointe Bank1.50% ($25k-$1m, guaranteed for 1 year) Ultimate Money Market - Account review
INOVA Federal Credit Union1.50% ($100k min)Platinum Money Market Savings
American Express Bank1.45%High Yield Savings - Account review
Ally Bank1.45%Online Savings - Account review
Alliant Credit Union1.45% ($100 min)High-Rate Savings - Account review
Self-Help Federal Credit Union1.43% ($500k), 1.33% ($500) Money Market - Account review
EverBank1.41% (1yr intro rate) 1.21% ongoing rateYield Pledge Money Market - Account review
FNBO Direct1.40%Online Savings
Discover Bank1.40% (no min) Online Savings - Account review
EBSB Direct1.39% ($25k+), 0.20% ($5k+)Money Market Direct - Account review
Dime Savings Bank1.35% Dime Direct Money Market, new money - Account review
Sallie Mae Bank1.35%High Yield Savings - Account review
Signal Financial Credit Union1.35% ($25k+, enrollment in Premium Bundle) Premium Money Market - Account review
Community Bank of Pleasant Hill1.32% Premier Money Management Account
Community Bank of Raymore1.32% Premier Money Management Account
Nationwide Bank1.30%Online Savings - Account review
Pacific National Bank1.30% Money Market Deposit Account - Account review
Bank of Internet USA (BofI)1.30% Smart Savings
BankPurely1.30% ($1 min) SavingPurely - Account review
Radius Bank1.30% ($2.5k min)Radius High-Yield Savings - Account review
UFB Direct1.30% ($25k+), 0.20% ($100) Premium Savings - Account review
CIBC USA (formerly The Palladin PrivateBank)1.30% (6mo intro rate) 1.10% blended APYSavings Account - Account review
McGraw-Hill Federal Credit Union1.30% ($75k), 1.10% ($20k),1.00% ($5k) (guaranteed through 12/31/18)Ascend Account - Account review
Discover Bank1.30% ($100k min), 1.25% ($2.5k) MMA - Account review
Franklin Synergy Bank1.29% ($500k+) Synergy Money Market
Quorum Federal Credit Union1.25% HighQ Savings
Bethpage Federal Credit Union1.25% ($500 min)Money Market
Chevron Federal Credit Union1.25% ($2.5k+), 0.25% ($1+) MarketEdge Savings
BBVA Compass1.25% ($10k min)ClearChoice MMA Promo - Account review
Hanscom Federal Credit Union1.25% ($25k min)Higher Yield Savings
INOVA Federal Credit Union1.25% ($50k min)Gold Money Market Savings

Reward Checking Accounts:

  • Noteworthy Accounts Available Nationwide:
InstitutionRatesNotes
Consumers Credit Union4.59% (up to $20k) Rewards Checking - debit card and $1k credit card requirements
Consumers Credit Union3.59% (up to $15k)Rewards Checking - debit card and credit card requirements
One American Bank3.50% (up to $10k), 0.25% ($10k+)Kasasa Cash - Account review
Consumers Credit Union3.09% (up to $10k)Rewards Checking - debit card with NO credit card requirements
Evansville Teachers Federal Credit Union3.00% (up to $20k), 0.00% ($20k+)Vertical Dividend Checking - Account review
MainStreet Bank3.00% (up to $15k), 0.25% ($15k+)Kasasa Cash - Account review
Lake Michigan Credit Union3.00% (up to $15k), 0.00% ($15k+)Max Checking
Signature Federal Credit Union3.00% (up to $15k), 0.10% ($15k+)Choice Checking
Great Lakes Credit Union3.00% (up to $10k), 0.10% ($10k+)Ultimate Checking
Partner Colorado Credit Union3.00% (up to $10k), 0.50% ($10k+)High Interest Checking
American Bank & Trust2.51% (up to $10k), 0.25% ($10k+)Kasasa Cash
Industrial Bank2.50% (up to $15k), 0.25% ($25k+)Kasasa Cash
Capital Educators Federal Credit Union2.50% (up to $10k), 0.20% ($10k+)High Yield Checking
New Buffalo Savings Bank2.27% (up to $15k), 0.2497% ($15k+)Kasasa Cash - Account review
Bellco Credit Union2.25% (up to $25k), 0.25% ($25k+)Boost Interest Checking - Account review
Main Street Bank2.25% (up to $25k), 0.25% ($25k+)Kasasa Cash - Account review
Altra Federal Credit Union2.25% (up to $15k), 0.50% ($15k+)A+ Checking
All America Bank2.25% (up to $10k), 0.50% ($10k+)Ultimate Rewards Checking
Redneck Bank2.25% (up to $10k), 0.50% ($10k+)Redneck Rewards Checking
Coastal Credit Union2.25% (up to $10k), 0.10% ($10k+) Go Green Checking - Account review that includes companion Go Green MMA
Georgia Bank Company2.15% (up to $25k), 0.40% ($25k+)Kasasa Cash - Account review
TruStone Financial Credit Union2.02% (up to $20k), 0.10% ($20k+)TruRate Checking - Account review
BankFirst2.02% (up to $10k), 0.15% ($10k+)Kasasa Cash
Finex2.018% (up to $25k), 0.20% ($25k+)Axcess Rewards Checking, Premier Account (formerly First New England Federal Credit Union)
XCEL Federal Credit Union2.01% (up to $25k), 0.03% ($25k+)Kasasa Cash Checking
Bay State Savings Bank2.01% (up to $20k), 0.25% ($20k+)Kasasa Cash - Account review
Legence Bank2.01% (up to $10k), 0.25% ($10k+)Kasasa Cash
Campus Federal2.01% (up to $10k), 0.05% ($10k+)Lagniappe Checking
Hawaii Pacific Federal Credit Union2.00% (up to $25k), 0.25% ($25k+)Kasasa Cash Checking
5Star Bank2.00% (up to $25k), 0.15% ($25k+)Kasasa Cash Checking Account review
Country Bank2.00% (up to $20k), 0.25% ($20k+)Kasasa Cash Checking Account review
Elements Financial2.00% (up to $20k), 0.10% ($20k+)High Interest Checking - Account review
Blue Federal Credit Union2.00% (up to $15k), 0.25% ($15k+)Extreme Checking (up to 4% w/account relationships) - Account review
United Educators Credit Union2.00% (up to $10k), 0.25% ($10k+)Kasasa Cash
KS StateBank1.95% (up to $25k), 0.50% ($25k+)Check PLUS - Account review
Connexus Credit Union1.75% (up to $25k), 0.25% ($25k+)Xtraordinary Checking
MemoryBank1.60% (up to $250k) EarnMore Interest Checking - Account review
First Tech Federal Credit Union1.58% (up to $10k), 0.16% ($10k+)Dividend Rewards Checking
Superior Choice Credit Union1.50% (up to $30k)AMP Checking
Heritage Bank1.41% (up to $25k), 0.15% ($25k+)eCentive Account
Marine Federal Credit Union1.26% (up to $10k), 0.05% ($10k+)Kasasa Cash Checking
Bank of Internet USA1.25% (up to $150k), 0.00% ($150k+)Rewards Checking

Certificates of Deposit:

Bank Account Alternatives - NOT FDIC Insured

InstitutionRatesNotes
Duke Energy PremierNotes1.65% ($50k+), 1.50% ($10k+), 1.45% (less than $10k)Duke Energy PremierNotes review
Vanguard Prime Money Market Fund1.47% 7-day yield
Ford Interest Advantage1.34% ($50k+), 1.29% ($15k+), $1.24% (less than $15k)Ford Interest Advantage review
Fidelity Money Market Fund1.28% 7-day yield
Ally Financial Demand Notes1.25% rate for $50k+
Vanguard Municipal Money Market Fund0.92% 7-day yield
Fidelity Municipal Money Market Fund0.86% 7-day yield

Removed, Rate Too Low

California First National Bank1.16%Money Market Checking

Post Publication Edits

2/21/2018: Synchrony Bank High Yield Savings rate raised.

2/23/2018: MyBankingDirect Money Market Account rates raised.

Related Pages: savings accounts, money market accounts, reward checking accounts, nationwide deals, Internet banks
Comments
john
john   |     |   Comment #1
but look at these crimes ,chase,td, wells ,barclay, bank anerica all record earnings and pay 0.1 nothing , boycott these greedy banks
deplorable 1
deplorable 1   |     |   Comment #8
@John: So true but you have to keep a local checking account for things like cashing checks/ATM withdrawals etc. The key is just to leave only a very small amount in there or the minimum balance just to keep it open and pay bills with other accounts. I feel this is the REAL reason for the 6 withdrawal per month limit on savings/MMA's as the banks would love you to keep thousands in your checking account to pay bills only earning a insulting .01 or 0%. You would think that the outrageous fee schedule at most banks would be enough for them to pay some interest. I have BoA checking as they bought out my old bank and they are the worst.
alan1
alan1   |     |   Comment #3
I think the article's section on noteworthy CD deals should include Freedom Credit Union's 3-year, 3.04% APY CD.

(I couldn't find that CD listed in the "CD Rates" section of this website. It is still being shown on the credit union's website.)
Data 101
Data 101   |     |   Comment #4
Freedom's 3 year CD has never shown up in the list of CD rates, even when all the filters are checked.

There are technical problems on this website, and no way to report them.
Ken Tumin
Ken Tumin   |     |   Comment #6
It should be showing up when PA is selected, but it currently is not. I will look into this. It does look like the CU is allowing anyone with ACC membership to join. So I'll see if we can get this added to the nationally-available table. Thanks.

About technical problems, if you don't see a bank or CU in the tables, first search for that institution in the top right box. This will take you to our bank page for that institution. Then click on "rates" on that bank page. Here you can see if the rates are being reviewed. Also in this rates section, there's a "report an issue" link on the top right. Click this, and a text box will open where you can submit your issue.
Ken Tumin
Ken Tumin   |     |   Comment #7
It's now listed in the 3yr table for nationally-available CDs. Hopefully, the CD and the nationally-availability will last. Sometimes a high number of out-of-state applications can change the minds of CU management in regards to who they allow to be members.
Ken Tumin
Ken Tumin   |     |   Comment #5
You're right. I've added that Freedom Credit Union CD in the noteworthy CD section. Thanks.