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Best Bank Account Interest Rates - Summary for March 21, 2017

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Best Bank Account Interest Rates - Summary for March 21, 2017

We didn’t have to wait a year for another Fed rate hike. Last week, at its second FOMC meeting of the year, the Fed raised the federal funds rate by 25 basis points. This Fed rate hike came after only about three months from the last Fed rate hike in December, which is a good sign that we will see multiple Fed rate hikes this year.

After the meeting last week, the Fed released new economic projections which included its projections on the federal funds rate, the “dot plot.” Since this rate hike occurred early in 2017, there had been expectations that the Fed may change its fed funds rate projections with more Fed members anticipating four or more rate hikes in 2017. That didn’t happen. Most FOMC members continue to anticipate just three rate hikes in 2017.

This unwillingness by the Fed to signal a faster pace of rate hikes impacted the Treasury market. All Treasury yields declined from last week. The 5-year and 10-year yields had the largest decline, falling 17 basis points.

This unwillingness also affected the Fed funds future contracts. According to the futures, the odds of additional rate hikes this year fell slightly from last week. The futures are now showing about a 54% chance of at least one rate hike by June and about a 54% chance of at least two rate hikes by December. Two additional rate hikes would result in a total of three rate hikes for 2017, matching what most FOMC members forecast.

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

Treasury Yields:

  • 1-month: 0.76% down from 0.77% last week
  • 6-month: 0.91% down from 0.93% last week
  • 2--year: 1.27% down from 1.40% last week
  • 5--year: 1.96% down from 2.13% last week
  • 10-year: 2.43% down from 2.60% last week
  • 30-year: 3.04% down from 3.17% last week

Fed funds futures' probabilities of future rate hikes by:

  • Jun 2017 - at least one hike: 54.0% down from 54.4% last week
  • Jun 2017 - at least two hikes: 3.3%
  • Dec 2017 - at least one hike: 88.1% down from 90.1% last week
  • Dec 2017 - at least two hikes: 54.1%

Savings & Checking Account Rates

I had hopes that another Fed rate hike (that occurred just three months after the second Fed rate hike) would finally spark some significant upward movement in savings and money market rates. That has not yet occurred. The little upward movement that we’re seeing is due to a few CD rate increases. Banks seem to be hesitant on increasing their savings and money market rates. Perhaps they believe increasing CD rates first after the Fed rate hike is a better strategy than raising their savings and money market rates. If banks can attract deposits with CDs early in a rising interest rate environment, banks will have fewer rate wars with their competitors as interest rates rise.

Out of the top nationally available savings and money market accounts, only one account had a rate increase, and the increase was small with a new rate that remains near the bottom of the list. Nationwide Bank increased its money market rate by 5 basis points to 0.55% APY.

The only other changes dealt with minimum balance requirements. My Banking Direct reduced the minimum balance requirement on its money market account. The account now earns 1.15% APY on balances of at least $5k. The minimum had been $25k (My Banking Direct is also offering a $50 bonus for making a $25k deposit and downloading and activating its mobile app.)

The other bank to reduce its minimum balance requirements is Discover Bank. They used to require a $500 minimum initial deposit when you opened a savings account. Now the minimum opening deposit is $0. All balances continue to qualify for the top rate (which is currently only 0.95%).

The 1% club remains unchanged. The number of accounts in this club remains at 24. The 1% club is the group of nationally available checking, savings and money market accounts that have rates of at least 1% APY. I exclude accounts that have promotional rates that are scheduled to fall after a certain amount of time. Also, I exclude accounts in which the 1%+ rate is available only for new customers. The ones on the promotional category include EverBank, The Palladian PrivateBank, Northeast Bank, iGObanking.com’s MMA and Salem Five Direct.

Reward Checking Accounts

Last week’s Fed rate hike has also had no impact on reward checking accounts, at least the top ones that are nationally available. There were no rate or cap changes in the last two weeks in the nationally available reward checking list.

There were two positive changes in the list. Two new institutions were added. However, they were added and their rows marked with green arrows because their reward checking accounts were recently identified as being nationally available. Both of them have been offering their reward checking accounts with the same rates and caps for awhile.

The first addition is the Kasasa Cash from New Buffalo Savings Bank. The Kasasa Cash account earns 2.27% APY for balances up to $35k if typical reward checking requirements are met (12 debits card purchases, logging into online banking and eStatements).

The second addition is the Vertical Dividend Checking from Evansville Teachers Federal Credit Union. This reward checking earns 3.00% APY for up to $15k if typical reward checking requirements are met (15 debit card purchases, direct deposit, online or mobile banking login and eStatements.) We just recently noticed that Evansville Teachers FCU updated their field of membership to allow anyone to join via an association membership.

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 & 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.

Hot CD Deals: I just wanted to include this reminder of two hot CD deals that are still available. We lost one hot CD deal last week. Andrews FCU is no longer offering its 7-year CD with a 3.00% APY. The rate has fallen to 2.20% APY.

The first hot CD deal that is still active is Navy Federal’s special 17-month CD. Two things make this a hot deal: a 2.00% APY and an add-on feature that allows any number of additional deposits. The one caveat is that there’s a maximum balance of $50,000. If you’re not already a Navy Fed member, there’s a good chance you can join. Please refer to this blog post for more details.

The second hot CD deal is at Mountain America Credit Union which is offering a 5-year CD (2.75% APY) with a one-time bump option (see blog post).

Rates as of March 21, 2017

Checking/Savings/Money Market Accounts:

  • Noteworthy Accounts Available Nationwide:
InstitutionRatesNotes
The Palladian PrivateBank1.30% (6mo intro rate) 1.10% blended APYSavings Account - Account review
Redneck Bank1.25% (up to $35k), 0.50% ($35k+)Mega Money Market Account
PurePoint Financial1.25% ($10k min)Online Savings - Account review
McGraw-Hill Federal Credit Union1.25% ($75k), 1.10% ($20k),1.00% ($5k) (guaranteed through 8/31/17)Ascend Account
HSBC1.25% ($100k relationship required)Promo Premier Savings - Account review
Popular Direct1.15%High Rise Savings - Account review
MyBankingDirect1.15% ($5k+), 0.25% (<$5k) Earn >More Money Market
Connexus Credit Union1.15% ($100k), 1.00% ($50k,) 0.75% ($20k)MMA - active chk required
Self-Help Federal Credit Union1.14% ($500k), 1.04% ($500) Money Market - Account review
Northpointe Bank1.12% ($10k min, 12mo rate guarantee)UltimateSavings - Account review
EverBank1.11% (1yr intro rate) 0.61% ongoing rateMMA/Checking - Account review
Incredible Bank1.11% ($2.5k), 0.05% ($250k+)IncredibleBank Savings - Account review
Northeast Bank1.10%Pearl Money Market Promo, new customers - Account review
Dime Savings Bank1.10% Dime Direct Money Market, new money - Account review
First Central Savings Bank1.10% ($10k min)E-Premier Money Market - Account review
iGObanking.com1.10% ($25k min) MMA, New accounts and new money only, Account review
Salem Five Direct1.10%eOne Savings, for new customers only Account review
SFGI Direct1.06%Savings account - Account review
Pacific National Bank1.06% Money Market Deposit Account - See review
McGraw-Hill Federal Credit Union1.05% (rate guarantee through 4/30/17)Holiday Money Market Promo - See review
CIT Bank1.05%High Yield Savings - Account review
SmartyPig1.05% ($50k min), 0.85% ($2.5k min)Savings account - Account review
AloStar Bank of Commerce1.05%Savings account - Account review
GS Bank1.05%Online savings account
Synchrony Bank (formerly GE Capital Retail Bk) 1.05%High Yield Savings
Sallie Mae Bank1.05%MMA - Account review
ableBanking1.00%Money Market Savings
iGObanking.com1.00%Savings account - Account review
Barclays1.00%Savings - Account review
Ally Bank1.00%Online Savings
Alliant Credit Union1.00% ($100 min)Savings account - Account review
Radius Bank1.00% ($2.5k min)Radius High-Yield Savings - Account review
Capital One 3601.00% ($10k+), 0.60% (up to $10k)360 Money Market - Account review
UFB Direct1.00% ($25k min)UFB Savings - Account review
FNBO Direct0.95%Savings account
Discover Bank0.95% (no min) Savings account - Account review
Incredible Bank0.95% ($2.5k min) MMA - Account review
Bank5 Connect0.90% ($100 min) Online savings account (not available for MA and RI residents)
Capital One 3600.90% ($100k) 0.75% ($50k)360 Checking
TIAA Direct0.90% ($100k)MMA
American Express Bank0.90%Savings account - Account review
Clear Sky Accounts0.90% ($250k max) Savings account - Account review
Digital Credit Union0.90% ($100k) 0.85% ($50k)MMA
Ally Bank0.85%MMA
Colorado Federal Savings Bank0.85% ($2.5k min)Savings account - Account review
Synchrony Bank (formerly GE Capital Retail Bk)0.85%MMA
Sallie Mae Bank0.85%Upromise GoalSaver Account
MySavingsDirect0.85%MySavings account - Account review
Discover Bank0.85% ($100k min) 0.80% ($2.5k) MMA - Account review
Bank5 Connect0.76% ($100 min) Checking account (not available for MA and RI residents)
California First National Bank0.75%Money Market Checking - Account review
Bank of Internet USA0.75%MMA
Capital One 3600.75%360 Savings account
Quorum Federal Credit Union0.70%HighQ Savings Account
TIAA Direct0.65%High Yield Savings account
FNBO Direct0.65%Checking account
Alliant Credit Union0.65%Checking (req's elec. dep & e-stmts) Account review
MyCBB0.60%MyCBB Money Market - Account review
Incredible Bank0.59% ($1k min) Checking - Account review
Nationwide Bank0.55% ($1k min) MMA
Elements Financial (formerly Eli Lilly Credit Union)0.55% ($10k min) Helium Savings - Account review
Citizens State Bank (FL)0.50% ($50k) 0.25% ($10k)Internet 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 $15k), 0.00% ($15k+)Vertical Dividend Checking - Account review
Lake Michigan Credit Union3.00% (up to $15k), 0.00% ($15k+)Max Checking
Great Lakes Credit Union3.00% (up to $10k), 0.10% ($10k+)Ultimate Checking
American Bank & Trust2.51% (up to $10k), 0.25% ($10k+)Kasasa Cash
Mid-Illini Credit Union2.50% (up to $25k), 0.15% ($25k+)Cash Rewards High Interest Checking - Account review
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 $35k), 0.2497% ($35k+)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
Coastal Federal Credit Union2.25% (up to $10k), 0.10% ($10k+) Go Green Checking - Account review that includes companion Go Green MMA
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
Legence Bank2.01% (up to $10k), 0.25% ($10k+)Kasasa Cash
Bay State Savings Bank2.01% (up to $20k), 0.25% ($20k+)Kasasa Cash - 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
MainStreet Bank2.00% (up to $15k), 0.25% ($15k+)Kasasa Cash - Account review
Blue Federal Credit Union2.00% (up to $15k), 0.25% ($15k+)Extreme Checking (up to 4% w/account relationships) - Account review
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
First Tech Federal Credit Union1.58% (up to $10k), 0.16% ($10k+)Dividend Rewards Checking
MemoryBank1.50% (up to $250k) EarnMore Interest Checking - Account review
All America Bank1.50% (up to $10k), 0.50% ($10k+)Ultimate Rewards Checking
ABCO Federal Credit Union1.26% (up to $25k), 0.20% ($25k+)Premiere Checking
Heritage Bank1.26% (up to $25k), 0.10% ($25k+)eCentive Account
Bank of Internet USA1.25% (up to $150k), 0.00% ($150k+)Rewards Checking
Community Bank of Raymore1.01% (up to $10k), 0.20% ($10k+)Kasasa Cash
Community Bank of Pleasant Hill1.01% (up to $10k), 0.20% ($10k+)Kasasa Cash
First American Bank1.00% (up to $15k), 0.13% ($15k+)Everyday Rewards Checking
Bank of Blue Valley1.00% (up to $10k), 0.10% ($10k+)$1k/month debit card req (formerly Ultimate Checking)

Certificates of Deposit:

Bank Account Alternatives - NOT FDIC Insured

InstitutionRatesNotes
Ally Financial Demand Notes1.15% rate for $50k+
Duke Energy PremierNotes1.05% rate for $50K+Duke Energy PremierNotes review
Ford Interest Advantage1.05% rate for $50k+Ford Interest Advantage review
Vanguard Prime Money Market Fund0.82% 7-day yield
Vanguard Tax-Exempt Money Market Fund0.59% 7-day yield
Fidelity Money Market Fund0.69% 7-day yieldreviews on Fatwallet
Fidelity Municipal Money Market Fund0.30% 7-day yield
Comments
LuvCD
LuvCD   |     |   Comment #1
Ken, how about a breakout of those IRA CDs with banks offered/through as a brokered CD? Thanks
Anonymous
Anonymous   |     |   Comment #2
Kearney Bank NJ has MMA that earns 1.5% over 1million - however first 99,000 earns no interest. Not only are Banking rates slow to move up buy they have multiple hoops to jump through just to earn these rates including having to make ridiculous debit transactions per mos. Pathetic for those of us who worked so hard to save our money.
LuvCD
LuvCD   |     |   Comment #3
And, CharlesR posted on the forum for LiveOak Bank what the haircut is...and note it is for a one branch bank! LiveOak "charges" their real customers an approx. .45% hit for doing business directly with it! Thus, the FDIC allows a higher rate for the same institution! And, And, the bank show disregards to its "normal" customers. Thus, why does anyone bank with them knowing the discriminating rates treatment?
James Barnes
James Barnes   |     |   Comment #4
Ken,
Thank you very much for including hot CD deals in your bi-weekly Best Bank Account Interest Rates report. This is greatly appreciated and a vast improvement. Two weeks is too long to wait to get updates on hot CD deals.
deplorable 1
deplorable 1   |     |   Comment #5
Yep those are the best 2 CD deals Ken. I have the 2% NFCU CD but I'm not sure that locking up money on a 5 year right now is a good idea. I think there will be a 3% five year CD before too long.
Bogey
Bogey   |     |   Comment #6
That's what I'm hoping for, waiting for. Waited this long, a little longer won't make that big of difference.
I do have a good CD ladder, but I still have some cash on the sidelines.
Bozo
Bozo   |     |   Comment #7
Deplorable, I would love to see a "no strings attached" 3% 5-yr CD "before too long", but I am not optimistic. I have three CDs maturing this year (two IRA CDs at PenFed and one after-tax CD at USAA), and I stand to take a major haircut in each.