Best Bank Account Interest Rates - Summary For March 17, 2020

In the last two weeks since the last liquid account summary, there have been two emergency Fed rate cuts which have lowered the target federal funds rate to near zero (the zero bound). Online banks were just starting to respond last week to the March 3rd Fed rate cut, and a few are already responding to the Sunday Fed rate cut. In the next month we should expect widespread decline to the rates of online savings and money market accounts.

If the online banks follow what they did during the last zero bound period (2008 to 2015), most online savings account rates should bottom out in the range of 0.70% to 1.00%. For the summary table below, I’ve set the threshold for inclusion at 0.50%. Any savings or money market account with a rate that falls below 0.50% will be removed. Hopefully, I won’t have to lower this threshold.

Due to the high number of accounts with rate cuts, I’ve only listed 10 of the most noteworthy rate changes that have occurred in the last two weeks. I created two lists. The first includes rate changes from the rate leaders. The second list includes rate changes from the major online banks. All percentages are APYs:

Rate changes from the rate leaders:

• CFG Bank High Yield Money Market (2.05% → 1.90%)
• BrioDirect High-Yield Savings (2.00% → 1.85%)
• TotalDirectBank Money Market (2.00% → 1.85%)
• SkyOne FCU High Yield Savings (2.00% → 1.80%)
• Popular Direct Ultimate Savings (1.90% → 1.80%)

Rate changes from the major online banks:

• Barclays Online Savings (1.70% → 1.60%)
• Ally Bank Online Savings (1.60% → 1.50%)
• PurePoint Financial Online Savings (1.70% → 1.50%)
• Capital One 360 Performance Savings (1.70% → 1.50%)
• Discover Bank Online Savings (1.60% → 1.50%)

FitnessBank’s Fitness Savings account remains the rate leader with a top tier APY of 2.10%. FitnessBank typically only changes its rates at the start of each month. Since the two emergency Fed rate cuts have happened in March, I expect a large rate cut when April begins. The top tier APY requires that the customer average 12,500 steps per day for the month as measured by a step tracker app. The rate falls to 2.00% APY when the step average is between 10,000 and 12,500, and 1.75% APY when the step average is between 7,500 and 10,000. The rate falls significantly for lower step averages. There are lower step requirements for customers over 64.

The highest rate without special requirements or limitations is now 2.00% APY. This is currently available from First Foundation Bank’s Online Savings account. Minimum balance is $1k.

The highest rate for a low-minimum savings account is now 1.86% APY. This is being offered by SFGI Direct. Minimum balance to earn this rate is just $1. Minimum balance to open the account is $500. I’m glad to see SFGI Direct on top since it has a long history of offering a very competitive online savings account.

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. One of these specials is no longer available, and another had a large rate cut.

The one that is no longer available is the Online Money Market account at Patriot Bank, which had guaranteed 2.00% through July 2020.

The one that had a large rate cut is the MAX-Yield Money Market account from Sun East Federal Credit Union. The rate fell from 2.05% to 1.25% APY. There is still a 13-month rate guarantee.

The second rate guarantee is the Platinum Money Market promotion offered by CFBank which is guaranteeing 1.60% APY on balances of at least $25k. There’s a short guarantee period of 120 days. The ongoing interest rates are low (1.00% APY for $25k and above, 0.75% for for $5k to under $25k).

The third rate guarantee is the Yield Pledge Money Market Account at TIAA Bank. The new-customer rate continues to be 1.75% APY for balances up to $250k. This is 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 1.01% for under $10k to 1.55% 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. All but one of the banks lowered their no-penalty CD rates from two weeks ago. Only CIT Bank held its rate steady.

• 1.70% APY 11-month No-Penalty CD ($1k min) - CIT Bank
• 1.70% APY 7-month No-Penalty CD ($500 min) - Goldman Sachs Bank USA
• 1.60% APY 11-month No-Penalty CD ($500 min) - Goldman Sachs Bank USA
• 1.55% APY 11-month No Penalty CD ($25k min) - Ally Bank
• 1.50% APY 13-month No-Penalty CD ($500 min) - Goldman Sachs Bank USA
• 1.50% APY 11-month No Penalty CD ($5k min) - Ally Bank
• 1.40% APY 11-month No Penalty CD (no min) - Ally Bank
• 1.35% APY 11-month Liquid CD ($5k min) - Citizens Access
• 1.35% APY 6-month No-Penalty CD ($500 min) - Investors eAccess
• 1.20% APY 11-month Flex Time Deposit ($100k min) - M.Y. eBanc
• 1.10% APY 11-month Flex Time Deposit ($10k min) - M.Y. eBanc
• 1.01% APY 11-month No-Penalty CD ($10k min) - PurePoint Financial
• 0.95% APY 13-month No-Penalty CD ($10k min) - PurePoint Financial
• 0.90% APY 14-month No-Penalty CD ($10k min) - PurePoint Financial
• 0.70% APY 11-month No Penalty CD ($5k min) - Colorado Federal Savings Bank

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 any time 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 from 2008 to 2015, money market funds had yields of around 0.01%. Now that the Fed has cut rates back to zero, money market fund yields will likely fall back to near 0.01%. This might take a few months.

The large yield reductions have begun. Vanguard Prime Money Market Fund 7-day yield fell by 19 bps in the last two weeks, falling from 1.60% to 1.41%. Fidelity Money Market Fund 7-day yield fell by 33 bps, falling from 1.38% to 1.05%.

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. These yields have been much more volatile in the last year. In the last two weeks, there have actually been yield gains due to liquidity issues. The Vanguard Municipal Money Market Fund 7-day yield gained 6 bps to 1.14%. Fidelity’s 7-day yield gained 12 bps to 0.95%.

Reward Checking Accounts

I’ll start with some good news for a change. Two new accounts were added to the list of nationally-available reward checking accounts. These New-To-Summary (NTS) accounts include the High Yield Checking from Ideal Credit Union and the Panorama Checking from Western Vista Federal Credit Union.

At Ideal Credit Union, the High Yield Checking earns 4.00% APY on balances up to $20k, and the rate is guaranteed to last until the end of June. On July 1, 2020, the rate will revert to 2.00% APY on balances up to $20k.

At Western Vista Federal Credit Union, the Panorama Checking earns 4.00% APY on balances up to $15k.

Now for the bad news. The other changes to the list of reward checking accounts involve rate reductions. For the case of Orion Federal Credit Union, only rates on the upper tiers declined. The primary rate (3.00% APY) remains the same for balances up to $15k. The rates for the portion of balances above $15k were lowered.

The Kasasa Cash checking accounts from three different institutions had large rate cuts.

Dover Federal Credit Union lowered the top tier rate of its Kasasa Cash account from 2.00% to 1.00% APY. This applies to balances up to $30k. This cap had been dropped to $15k when the top tier yield fell from 3.25% to 2.00%.

Georgia Banking Company (GBC) lowered the top tier rate of its Kasasa Cash account from 2.00% to 0.85% in two rate cuts. The 0.85% APY applies to balances up to $25k.

MainStreet Bank of Fairfax, VA also had a large rate cut on its Kasasa Cash account. The top tier rate fell from 3.00% APY to 0.75% APY for balances up to $15k.

We are still waiting on TAB Bank to launch its new reward checking account. The bank is no longer accepting applications for its Kasasa Cash Checking account. Existing customers still earn 4.00% APY on qualifying balances of up to $50k. This account had been the rate leader for nationally-available reward checking accounts since it was launched around April 2019. Not only was it a rate leader, it had a top balance cap of $50k. Balances of up to $50k could qualify for the 4.00% APY if monthly requirements were met. Most reward checking accounts have much lower caps that range from $5k to $25k.

Heritage Bank’s eCentive Account remains the rate leader for accounts with balance caps of at least $25k. It has a top tier rate of 3.03% APY on balances up to $25k. Unfortunately, the bank has a message on its Savings & Checking Rates page informing customers that “Due to Federal Reserve rate reductions in March, our eCentive rate will be reduced as of April 1, 2020.” There’s no mention of what the new rate will be. We’ve been tracking this account since 2009. Its top tier rate increased to 3.33% APY in April 2018, and this rate held until last December when it fell to 3.03% APY.

Overall, reward checking accounts have generally been more resistant to Fed rate cuts than online savings accounts. We’ll see if this continues now that the Fed has moved us back to the zero bound. History during the last zero bound period (2008 to 2015) has shown that reward checking accounts can sustain rates significantly higher than online savings account rates during a zero interest rate environment.

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 (at least as of today).

Navy Federal Credit Union continues to offer a very competitive Certificate Special. It’s a 17-month add-on Certificate with a 2.25% APY. Minimum deposit is $50, and the maximum balance is $75k. Additional deposits are allowed at any time, subject to the maximum balance. It’s not available inside an IRA. Navy Federal continues to offer a 37-month IRA CD special with a 3.00% APY. This only applies to IRA and ESA CDs. There’s a $50 minimum balance and a $150k maximum balance. Like the 17-month Special, additional deposits are allowed at any time, subject to the maximum balance.

[[ UPDATE 3/18/20: Andrews FCU's CD rates have fallen. The 5-year Jumbo CD and IRA CD rate has fallen to 1.55% APY. The 7-year regular CD rate is now only 1.60% APY. ]] Andrews Federal Credit Union is no longer offering Special CDs, including the Special 7-year CD that had a 3.05% APY. The highest non-IRA CD rate is now 2.35% APY (7-year term for a $1k minimum or a 5-year term for a $10k minimum). The 7-year IRA Share Certificate has the highest rate of 2.60% APY. Minimum deposit is $1k. People in any state can join this credit union via the American Consumer Council.

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:

Reward Checking Accounts:

• Best Reward Checking Account Rates

• Noteworthy Accounts Available Nationwide:

*New to Summary

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 November 1, 2019 to April 30, 2020

Removed, No Longer Available

Removed Following Rate Drop