Latest Liquid Bank Account Rates

Savings and money market rate increases have slowed, and that will likely continue if the Fed holds rates steady at its meeting this afternoon.

In the last two weeks, the most significant rate hike was at Synchrony Bank. Its savings account rate increased 25 bps to 4.75% APY. The only other well-established online savings accounts that had rate hikes were those from Marcus by Goldman Sachs (4.40% APY) and Citi (4.35% APY). Both had rate increases of only 10 bps.

At the time of the June Fed meeting about three months ago, the savings account APYs at Synchrony, Marcus and Citi were 4.30%, 4.15% and 4.05%, respectively. The other well-established online savings accounts had similar rates. Capital One 360 Performance Savings was 4.10% APY. Ally, Discover, American Express and Barclays were at 4.00% APY. Now, these savings account APYs range from 4.25% to 4.35%. In short, the rate hikes of the well-established online banks have generally followed the Fed. Their rates have remained well below the federal funds rate, but their rate changes have been inline with the Fed.

The average online savings account yield is now on the high end of these well-established online savings account yields. As of September 1st, the average yield was 4.39%. This is up about 15 bps from August 1st, The average online savings account APY is based on the Online Savings Account Index, which tracks the average APYs of ten well-established online savings accounts.

The small and new online banks have kept their online savings account rates closer to the federal funds rate. A few of these online savings accounts are from large banks. One of the largest, BMO Bank NA with $263 billion in assets, recently began an online division called BMO Alto that offers an online savings account and online CDs. The online savings account rate has been higher than what the well-established online banks have been offering. BMO Alto Online Savings APY recently surpassed 5%, increasing from 4.85% to 5.10%. The savings account has no minimum balance requirements, and there are no monthly fees. I’ll have more on this account and BMO Alto soon.

With the target federal funds rate having been at 5.25%-5.50% for eight weeks now, you would expect many online savings accounts with APYs in this range. You can easily get this yield with money market funds (MMFs). For example, one of the largest federal MMFs, Vanguard Federal MMF (VMFXX), now has a 7 day SEC yield of 5.28%. Its compound yield (which is essentially APY) is 5.41%.

The top online savings account APYs are primarily stuck at 5.25%. There are a couple with higher rates that I’ll cover in the rate leader section below, but there are no online banks trying to stand out with APYs way above 5.25% like what we saw in 2007 when FNBO Direct and HSBC Direct were offering promotional 6% APYs on their savings accounts.

I’ve listed the most noteworthy rate changes that have occurred in the last two weeks. There are now three lists. I’ve created a new list just for the banks and credit unions that are listed on the Raisin platform (formerly SaveBetter). The other two lists remain the same. One includes rate changes from the major online banks. The second one includes rate changes from online banks which are generally not well-known names.

All percentages are APYs.

Rate changes from the major online banks:

• Synchrony Bank HY Savings (4.50% → 4.75%)
• Marcus by Goldman Sachs HY Online Savings (4.30% → 4.40%)
• Citi Accelerate Savings (4.25% → 4.35%)

Rate changes from banks & CUs on the Raisin.com platform

• American First CU MMDA via Raisin (5.24% → 5.26%)

Rate changes from the less well-known CUs & online banks:

• Elevault Vaults (New: 5.50% up to $40k)
• RBMAX Max Interest Savings (5.00% → 5.15%)
• BMO Alto Online Savings (4.85% → 5.10%)
• CNB Bank Direct Premium MM ($25k+ 4.39% → 4.70%)
• CNB Bank Direct HY Savings (4.28% → 4.60%)

Current rate leaders

There are now 17 savings and money market accounts in the 5.25% club. This is down from 18 two weeks ago. This reduction is due to a change of banks being listed on the Raisin platform. Outside of Raisin, there were no changes to the 5.25% club.

You might have noticed that Elevault is now listed on top of the high yield savings account rate table with a 5.50% APY. Elevault is a new mobile-only banking app of Southern Bancorp, an FDIC member. Its accounts are called vaults, and they currently pay 5.50% APY. However, the maximum balance allowed for all vaults of a customer is $40k. Consequently, this is being listed in the “Reverse Tier Savings” section which includes accounts that have the highest rates on relatively small balances.

Due to the $40k max balance, Elevault isn’t included in the 5.25% club. To be in this club, online savings and money market accounts must have APYs of at least 5.25% for reasonable balances. My definition of reasonable balance is one that’s not too high or one that doesn’t have small maximum balances. Minimum balance to qualify for the 5.25% APY should be no more than $100k, and the 5.25% APY should apply to balances up to at least $250k.

The rate leader continues to be the Preferred Savings account at BluPeak Credit Union. This savings account has a 5.33% APY on all balances (minimum to open is $25). It’s only available to new members. BluPeak Credit Union (formerly named USE Credit Union) is headquartered in San Diego. People from any state are eligible to join via membership in KPBS (the PBS member station in San Diego).

The Max Savings Account from Customers Bank continues to be in second place with a 5.30% APY on all balances. This Max Savings is only available from MaxMyInterest.com.

Five banks remain in third place with 5.26% APY. The only account directly available from a bank is the Direct Money Market Deposit Account at TotalDirectBank. The 5.26% APY applies to balances of at least $2.5k. The minimum initial deposit is $25k. An important issue with TotalDirectBank is that they don’t have an ACH transfer system. You’ll have to rely on the ACH system of another bank to transfer funds. The account is available nationwide, with the exception of Florida.

The other four accounts with a 5.26% APY are only available from the Raisin platform. Three of the banks are the same as two weeks ago (OptimumBank, FVCbank and CloudBank 247). One of the four banks from two weeks ago, Hanover Bank, is no longer listed at Raisin. Hanover Bank has been replaced by American First Credit Union which increased its Money Market Deposit Account rate to 5.26% APY.

The remaining ten accounts in this club all have a 5.25% APY.

Four of the 5.25% accounts are on the Raisin platform. These four savings and money market accounts are offered by Pacific Western Bank, Oklahoma State Bank, Harborstone Credit Union, and Greenwood Credit Union. Western Alliance Bank had been offering a High Yield Savings Account on Raisin with a 5.25% APY, but the account has been removed from the Raisin listing. Western Alliance Bank continues to list CDs on Raisin.

The other six 5.25% accounts have been in the club since at least the last summary. These include the High Yield Savings and High Yield Money Market accounts at UFB Direct, the Personal High Yield Savings account at Newtek Bank, the savings and jar accounts at Milli Bank, the High-Yield Online Savings account at Evergreen Bank Group, the High Yield Savings account at Valleydirect, and the Cornerstone Money Market Savings account at Vio Bank.

Money Market Deposit Accounts (MMDA) and High YIeld Savings Accounts (HYSA) at Raisin are essentially the same. They both have a minimum balance requirement of only $1, and there’s no maximum balance. Unlike the traditional money market account, the MMDAs at Raisin have no check writing capability. Also, neither the HYSA nor the MMDA has debit card access. All deposits and withdrawals must be initiated when you’re logged onto the Raisin platform, and they can only be transferred to and from your linked external bank account.

Rate guarantees without withdrawal penalties

There’s a new rate leader for nationally available no-penalty CDs. It’s the 12-month Liquid CD that’s available from Credit Human. It has a 5.50% APY, and a minimum deposit of $5k. You are allowed to make up to two, no-penalty withdrawals during the term as long as you maintain a minimum balance of $5k. The Liquid CD also allows unlimited deposits during the term. People in any state are eligible to join the credit union, Credit Human, via membership in an association.

Second place is now All In Credit Union, which continues to offer a 9-month Jumbo CD (5.33% APY) and 9-month CD (5.27% APY). The Jumbo has a $100k minimum, and the regular CD has a $1k minimum. Each allows the member to make one penalty-free early withdrawal. People in any state are eligible to join All In Credit Union via membership in an association.

Third place is now a no-penalty CD that’s on the Raisin platform. It has a 5.31% APY and a 9-month term. It’s being offered by Freedom Bank. Right behind this no-penalty CD are three Raisin no-penalty CDs with a 5.30% APY. Two have 12-month terms (from FVCbank and GreenState Credit Union), and the other has a 4-month term (Ponce Bank).

Two of the major online banks increased the rates of their no-penalty CDs. Marcus by Goldman Sachs increased the rate of its 13-month No Penalty CD to 4.60% APY, and Synchrony Bank increased the rate of its 11-month No Penalty CD to 4.50% APY.

Raisin No Penalty CDs have two important features that customers should understand. First, early withdrawals can only be done 30 days after opening. Other no-penalty CDs only require a wait of 7 days before you can execute an early withdrawal. Second, interest can’t be paid out without closing the CD. If you need regular interest payments from your CD, don’t choose Raisin.

Some banks like CIT Bank and Ally Bank make it easy to open and close the no-penalty CDs. You just lose access to the money in the no-penalty CD for the first six days from account funding. After that, you are free to close the CD without penalty

Money Market Funds

If you don’t want to deal with the hassles of the online banks that offer 5%+ yields, a money market fund can make things easier. Money market fund yields have continued to respond quickly to the Fed rate hikes. Another benefit of a money market fund is that you can do your part to put pressure on the banks to raise their deposit rates.

The Vanguard Federal Money Market Fund (VMFXX) 7-day yield is now 5.28%, up 1 bp from two weeks ago. Vanguard reports the compound yield to be 5.41%. This is defined as “the interest earned on the original principal invested and also on the interest earned in previous periods,” which would make it similar to APY for bank accounts.

The Fidelity Money Market Fund (SPRXX) has a 7-day yield of 5.05%, up 1 bp from two weeks ago. Its compound yield is 5.18%. As usual, it lags Vanguard’s yield by 20 to 25 bps.

Municipal money market fund yields have been up and down, even as the Fed keeps hiking. Two weeks ago, the yields had significant gains from the previous two weeks. Today, yields are down by a large amount from two weeks ago. The Vanguard Municipal Money Market Fund (VMSXX) 7-day yield is now 2.96%, down from 3.90% two weeks ago. The 7-day yield of the Fidelity Municipal Money Market Fund (FTEXX) is now 2.79%, down from 3.65% two weeks ago.

Money market funds from brokerages are another option for your cash. They don’t have FDIC coverage, but they can be reasonable alternatives to deposit accounts. To maximize safety, choose only those that invest in Treasurys or federal government debt. Also, stay with the major brokerage firms like Fidelity, Vanguard or Schwab.

Money market fund yields tend to be close to zero when the Fed sets the target federal funds rate to 0%, and they tend to follow the target federal funds rate during a rate-hiking cycle (unlike the major online savings accounts which have let us down in this cycle.)

Reward Checking Accounts

For the nationally-available reward checking accounts (RCAs), there were no noteworthy changes in the last two weeks.

Credit Union of New Jersey’s Kasasa Cash Checking remains the best deal with a 6.00% APY for balances up to $25k.

Reward checking accounts have a history of being slow to respond to rising rates, especially when compared to online savings accounts. It’s hard to find reward checking attractive when their top rates are below online savings account rates. The only reason you might consider an RCA is if the bank also offers a competitive online savings or money market account. Two examples include All America Bank and Evergreen Bank Group. In these cases, you might want both the RCA and the online savings/money market account. Keep most of your savings in the savings/money market account, and use the RCA as your primary checking account.

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 Deals

I publish my CD survey as a separate post. Please refer to my survey of the best CD rates. This recap focuses on liquid accounts, but I’ll include a few of the best CD deals.

Long-dated Treasury yields have been rising in September, and in the last day, yields have risen to highs not seen since 2007. This rise has been impacting brokered CD rates, and it is slowly starting to impact direct CD rates. This morning, I checked Fidelity, and the top non-callable new-issue brokered CD rates were 4.70%, 4.85%, 5.10%, and 5.30% for 5-year, 4-year, 3-year and 2-year terms, respectively. The banks that had issued the 2-year 5.30% CD were Discover, Wells Fargo and the two banks of Morgan Stanley. Last week, the top rates at Fidelity for these four terms were 4.70%, 4.80%, 5.00%, and 5.25%.

The highest brokered non-callable CD rate today at Fidelity was 5.50%. CDs with terms from 6 months to 18 months all had this top rate.

Even though longer-term Treasury yields have been rising, the yield curve remains inverted, and that condition still exists for CD rates.

The highest nationally available CD rate is now 5.90% APY for a 1-year term. That’s now available at Latino Credit Union for a $200k deposit. Its short-term CD rates went up, but its long-term CD rates had big declines, and they’re no longer rate leaders.

Another institution that had rate cuts is MapleMark Bank. It used to have the highest 2-year CD rate, but that rate fell 15 bps to 5.40% APY. The highest rate now in this 2-year category is 5.50% APY. This is available from a 21-month CD from Finworth and a 23-month CD Special at Vibrant Credit Union.

For the 3-year category, United States Senate FCU holds the top spot with a 5.34% APY 3-year Share Certificate. This requires a $200k minimum deposit. Lower rates are available with smaller minimum deposits (5.28% APY, $100k minimum and 5.23% APY, $1k minimum).

There’s a new rate leader for the 4-year and 5-year category. Farmers Insurance Federal Credit Union is offering a Flex-Term Certificate Special with a 5.00% APY available for all terms from 3 months to 60 months. Minimum deposit is $1k. After the rate cuts at Latino Credit union, Farmers Insurance FCU is now the only institution to offer 5% APY on 4-year and 5-year CDs that are nationally available online. People in any state are eligible to join this credit union via membership in an association.

If you want a competitive long-term CD at an established online bank (not a credit union) that has a mild early withdrawal penalty (EWP), Barclays continues to offer a 4.50% APY on its 5-year CD. In June, the 5-year rate fell from 4.50% APY to 4.20% APY. In July, the rate returned to 4.50% APY. According to Barclays’ CD Terms and Conditions, “You may, subject to an early withdrawal penalty, make withdrawals of principal from your CD Account before maturity.” The EWP for its long-term CDs reads as follows: “for a CD Account with a term of more than 24 months, a penalty equaling 180 days simple interest on the dollar amount withdrawn subject to penalty will be imposed.” You can see the impact of early closure on the effective APY by using this CD Early Withdrawal Penalty Calculator

Comments

Please keep discussions of politics, the Fed and the economy to a minimum in the comments of this post. The focus of the comments should be deposit accounts and rates. Comments in this post that include politics may be removed. Also, comments with any rudeness towards others will be removed.

Political discussion that relates to the economy should be kept in my Fed meeting review post which will be published this afternoon.

Rates as of September 20, 2023

Checking/Savings/Money Market Accounts:

• Best Savings Account Rates (Nationwide and by State)
• Best Money Market Rates (Nationwide and by State)
• Best Checking Account Rates (Nationwide and by State)

No-Penalty CDs

Reverse Tier Savings/Money Market Accounts/Checking:

*New to Summary

Reward Checking Accounts:

• Best Reward Checking Account Rates

• Noteworthy Accounts Available Nationwide:

Certificates of Deposit:

• Best CD Rates (Nationwide and by State)
• Best IRA CD Rates (Nationwide and by State)
• Survey of the Best CD Rates (Nationwide and Local)

Bank Account Alternatives - May Not Be FDIC Insured

• Investment Discussion Forum

• Series I Savings Bond Purchased after May 1, 2023

Accounts Removed, No Longer Available