Best Bank Account Interest Rates - Summary For October 15, 2019

More banks lowered rates on their savings and money market accounts. The sizes of the rate cuts have generally been less than 25 bps, the size of the September Fed rate cut. As we saw after the July Fed rate cut, online banks will typically spread out their rate cuts over a period of a month or two.

Below are the noteworthy savings and money market account rate reductions that have occurred in the last two weeks (All percentages are APYs):

• CFG Community Bank High Yield Money Market (-5 bps to 2.45%)
• BrioDirect High-Yield Savings (-16 bps to 2.30%)
• Popular Direct Ultimate Savings (-10 bps to 2.30%)
• Vio Bank Online High Yield Savings (-15 bps to 2.27%)
• Quontic Bank Personal Money Market (-10 bps to 2.20%)
• Comenity Direct High-Yield Savings (-10 bps to 2.15%)
• Western State Bank High Yield Money Market (-15 bps to 2.10%)
• MySavingsDirect Savings (-15 bps to 2.10%)
• WebBank Savings (-10 bps to 2.10%)
• CIBC Agility Savings (-15 bps to 2.05%)
• HSBC Direct Savings (-15 bps to 2.05%)
• Envision Bank Savvy Savings (-14 bps to 2.01%)
• PNC Bank Online High Yield Savings (-15 bps to 2.00%)
• BankUnitedDirect Online Money Market (+25 bps to 2.00%)
• Rising Bank High Yield Savings (-10 bps to 2.00%)
• Bay State Savings Bank Money Market (-10 bps to 2.00%)
• Synchrony Bank High Yield Savings (-10 bps to 1.90%)
• Barclays Online Savings (-10 bps to 1.90%)
• Marcus by Goldman Sachs Online Savings (-10 bps to 1.90%)
• Colorado Federal Savings Bank Premier Savings (-12 bps to 1.90%)
• Ally Bank Online Savings (-10 bps to 1.80%)
• Colorado Federal Savings Bank High Yield Savings (-12 bps to 1.75%)
• Quorum FCU HighQ Savings (-5 bps to 1.75%)
• MidFirst Direct High Yield Online Savings (-50 bps to 1.50%)

Only one bank increased rates. That was BankUnitedDirect which increased the yield of its Online Money Market by 25 bps to 2.00% APY. This yield had been 1.95% for most of August and September, but on September 23rd, the yield dropped to 1.75%. Then on October 1st, the yield went up to 2.00%. This account is just over a year old, so it’s hard to know if BankUnited is really committed to remaining competitive or is just trying to attract customers into this fairly new product.

Two banks and one credit union introduced new savings products with rates above 2%.

CFG Community Bank introduced an Online High Yield Money Market that currently earns 2.45% APY on balances of at least $25k. Balances between $1k and $25k earn 2.36% APY. This is now the highest rate for a savings or money market account without activity requirements. The top-tier yield just recently fell from 2.50% to 2.45%, which isn’t a good sign for a rate leader.

Close behind CFG is First Foundation’s new online savings account which earns 2.40% APY on balances of $1k and above.

The credit union to add a new online savings account is SkyOne Credit Union. Its High Yield Savings Account earns 2.25% APY on balances of $1k and above. There’s also the requirement of a $1k monthly deposit. I’ll have more details on this account and credit union soon.

The rate leader continues to be FitnessBank’s Savings Account, but the top rate has fallen 25 bps to 2.75% APY. This requires that the customer average 12,500 steps per day for the month as measured by a step tracker and app. The rate falls to 2.50% APY when the step average is between 10,000 and 12,500. The rate falls significantly for lower step averages. Since only some of the customers receive these high rates, the average interest yield that FitnessBank pays out is much less than 2.75%. That may increase the odds of FitnessBank maintaining the rate lead status.

Due to a rate cut, BrioDirect dropped out of the top spot for savings accounts without activity requirements. As mentioned above, that spot now goes to CFG Community Bank and its High Yield Money Market Account. The account earns 2.45% APY on balances of at least $25k.

The top spot for a savings account without activity requirements and without a large balance requirement goes to five banks. All offer 2.40% APY. These five banks are First Foundation, BBVA Compass, TAB Bank, All America Bank, and Redneck Bank. Note, All America Bank and Redneck Bank are scheduled to lower their Mega Money Market APYs to 2.25% on 10/22/2019.

Rate guarantees without withdrawal penalties

When rates are falling, the best savings and money market deals are specials that guarantee a rate for a period of time. There are currently four accounts with rate guarantees that are worth mentioning.

First, there’s a new rate guarantee. Customers Bank is offering another promotion on its Ascent Money Market Savings Account with a 2.25% APY guaranteed until 6/30/2020. A minimum balance of $25k is required.

The other new rate guarantee is being offered by Elements Financial Credit Union. It’s a new promotion of its Helium Savings Account. For new account holders, the account earns 2.10% APY on balances of $2.5k and above. That rate is guaranteed for one year. After that one year, there will likely be a large rate drop. The current rate on its standard Helium Savings Account is only 1.30% APY.

Last month I reported on the MAX-Yield Money Market Account promotion at Sun East Federal Credit Union. This is still available. The account offers 2.20% APY on balances from $5k to $250k, and the rate is guaranteed for 13 months from account opening. Withdrawals are much more limited than the average money market account. Fee-free withdrawals are restricted to only one per calendar quarter.

The fourth rate guarantee is the Yield Pledge Money Market Account at TIAA Bank. This account offers new customers 2.00% APY on balances up to $250k that’s guaranteed for the first year of account opening. A version of this offer has long been available at TIAA Bank/EverBank. After the 1-year intro period, a tiered-rate structure takes effect. The current ongoing APYs range from 1.00% for under $10k to 1.80% for over $100k.

No-penalty CDs have some of the liquidity of savings and money market accounts, but like CDs, they offer a rate lock which can be useful when rates are falling. No-penalty CDs have become more common at online banks in the last year, and they are something to consider, especially if you already have a savings account at the bank. The main issue now is that their rates have been falling. If their rates are higher than the savings account, these can be good deals in this falling rate environment.

Some banks like Ally 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. Ally makes it very quick and easy to move the CD funds into your savings or checking account.

Below is a list of noteworthy no-penalty CDs. Recent rate cuts have occurred at Ally Bank and Goldman Sachs Bank USA.

• 2.10% APY 7-month No-Penalty CD ($500 min) - Goldman Sachs Bank USA
• 2.05% APY 11-month No-Penalty CD ($1k min) - CIT Bank
• 2.00% APY 13-month No-Penalty CD ($10k min) - PurePoint Financial
• 2.00% APY 11-month No Penalty CD ($25k min) - Ally Bank
• 1.90% APY 11-month No-Penalty CD ($500 min) - Goldman Sachs Bank USA
• 1.85% APY 13-month No-Penalty CD ($500 min) - Goldman Sachs Bank USA
• 1.80% APY 6-month No-Penalty CD ($500 min) - Investors eAccess

Remember that when talking about no-penalty CDs (that function like Ally’s No Penalty CD), a longer term is always better. Since you can close these types of no-penalty CDs at anytime after the first six days, I can’t think of a reason to choose a shorter-term no-penalty CD if the rate is the same.

Competition from Money Market Funds

Another option for your cash instead of savings accounts and money market accounts are money market funds from brokerages. These don’t have FDIC coverage, but they can be reasonable alternatives to deposit accounts. Back when the Fed was holding rates near zero, money market funds had yields of around 0.01%. Keeping your cash at internet banks made a lot more sense back then. Now, it’s not so clear. Money market fund yields have risen substantially as the Fed hiked rates. However, their yields have been falling in this current environment. Now with the Fed starting to cut rates, we will likely see larger yield cuts on money market funds.

Vanguard Prime Money Market Fund 7-day yield fell 4 bps in the last two weeks, falling from 2.00% to 1.96%. Fidelity Money Market Fund 7-day yield fell 6 bps, falling from 1.75% to 1.69%.

Municipal money market funds have the advantage of being exempt from federal income tax, but their yields continue to be quite a bit lower than the other money market funds. Also, in the last year, their yields have been volatile. That’s the case this week. The Vanguard Municipal Money Market Fund 7-day yield fell 17 bps to 1.30%. Fidelity’s 7-day yield fell 10 bps to 1.09%.

Reward Checking Accounts

In the last two weeks, there have been no changes to the list of nationally-available reward checking accounts.

Overall, reward checking accounts continue to buck the trend of falling rates. If rates keep falling, I expect we’ll see more rate and balance cap cuts on reward checking accounts. However, history has shown that reward checking accounts can sustain rates significantly higher than online savings account rates, even during a zero interest rate environment.

TAB Bank’s Kasasa Cash account remains the best deal with a 4.00% APY for balances up to $50k.

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 focuses on liquid accounts.

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

Navy Federal Credit Union continues to offer three very competitive Certificate Specials. All three have rates lower than when these specials began. Nevertheless, the current rates are very competitive. The 5-year Certificate earns 3.00% APY: it’s one of the rare 3% CDs. The 18-month Certificate earns 2.60% APY and the 9-month earns 2.25% APY. Minimum deposit is $1k for all three. Technically, these Certificates are not nationally available since a military connection is required to join Navy Federal. However, there’s a good chance you are eligible. You only need to have a family member who served in the military at some time in the past. I have more details in my Navy Federal Certificate review.

Another good 5-year CD deal is from Justice Federal Credit Union. It’s offering 5-year rates up to 3.21% APY. This requires a $100k minimum deposit and a checking relationship. The rates are about 10 bps lower without a checking relationship, and 10 bps lower for a $500 minimum deposit.

Lastly, there’s a hot local CD deal in Southern California. Credit Union of Southern California is offering a 5-month CD Special that earns 5.00% APY. Maximum deposit is $50k. Unfortunately, this is a local deal that’s primarily limited to residents of four Southern California counties.

This is my new weekly summary with the Fed review split off on a separate blog post. My weekly summaries will now be focused entirely on deposit rates and deals. Please keep all discussion about the Fed, the economy and politics to my Fed/Economy review blog post.

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)

• Noteworthy Accounts Available Nationwide:

*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 from May 1, 2019 to October 31, 2019

Post Publication Edits

10/16/2019: Customers Bank corrections: Ascent MMSA corrected to 2.25%. HYSA corrected to 2.20%
10/16/2019: TAB Bank correction: HYSA min corrected from $2.5k to $1
10/16/2019: Added notes on All America Bank and Redneck Bank regarding upcoming rate cuts.