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CD Rates Summary November 22, 2016


CD Rates Summary November 22, 2016

A rate hike at the next Fed meeting in December is looking very likely. Last Thursday Fed Chair Janet Yellen said in Congressional testimony that a rate hike “could well become appropriate relatively soon if incoming data provide some further evidence of continued progress toward the committee’s objectives.” If the November’s job report doesn’t have any major disappointments, we should see the first Fed rate hike for the year. Hopefully, we won’t have to wait another year for the next rate hike.

More signs of a December rate hike may come tomorrow from the release of the FOMC minutes for the November meeting. The election that came after the last meeting has only improved the chances of a rate hike.

The chance of a December rate hike has been increasing according to the Fed funds futures. They now indicate a 93.5% chance of a Fed rate hike in December. That’s up from 91% last week. Another thing to look at from the Fed funds futures is the chance of a second rate hike next year. They’re indicating a 51% chance of a second rate hike by next June. Treasury yields are also showing signs of a rising rate environment. Yields are up for most maturities, with the 5-year yield up the most..The following numbers are based on Daily Treasury Yield Curve Rates and the CME Group FedWatch.

Treasury Yields:

  • 1-month: 0.34% up from 0.30% last week
  • 6-month: 0.61% same as last week
  • 2--year: 1.07% up from 1.02% last week
  • 5--year: 1.77% up from 1.68% last week
  • 10-year: 2.31% up from 2.23% last week
  • 30-year: 3.00% up from 2.97% last week

Fed funds futures' probability of at least one additional rate hike by:

  • Dec 2016: 93.5% up from 91% last week
  • Mar 2017: 95% up from 92% last week
  • Jun 2017: 97% up from 95% last week

Certificate of Deposit Rates

For deposit accounts, the first signs of a rising rate environment often come from brokered CDs. In the last two weeks, brokered CD rates have gone up considerably. As an example, the best rate on a new issue Fidelity brokered CD has increased from 1.80% to 2.10% over the last two weeks. Brokered CD rates are now very competitive with the best internet bank CDs.

Direct CDs from banks and credit unions still show little movement. There were just a few CD rate increases on the my list of top nationally available CDs. EverBank increased several of its CD rates last week. Its 5-year CD rate is now tied with Popular Direct for the top 5-year CD rate for internet banks (2.05% APY). Credit Unions continue to offer the best 5-year CD rates. Mountain America Credit Union’s 5-year CD continues to be the best deal for small balances (2.30% APY).

We are starting to see 3% CDs. The latest one is part of a Black Friday promotion from Public Service Credit Union for Colorado residents. The special CD has a 2-year term with a 3.00% APY. One significant downside with this special is a $10k maximum deposit.

The Black Friday CD specials at Andrews Federal Credit Union have a 3.01% APY with no maximum deposit. The terms are 3 months and 7 years. The 3-month is too short, and the 7-year may seem too long when it appears we’re at the start of a rising interest rate environment. Membership in Andrews FCU is open to anyone through the American Consumer Council. Please refer to this review of these specials for more details.

Finally, here’s my usual note about long-term CDs with mild early withdrawal penalties.

An alternative to short-term CDs is long-term CDs that have mild early withdrawal penalties. I include the effective yields of a few 5-year CDs when closed early in the tables below. All of these have competitive 5-year CD rates and an early withdrawal penalty of 6 months of interest or less. The combination of a high 5-year CD rate combined with a mild early withdrawal penalty makes these CDs pretty good deals even when closed early. If you want to compare the effective yields of other CDs after the early withdrawal penalties, please refer to our CD early withdrawal penalty calculator.

The risks of planning for early withdrawals of long-term CDs were highlighted by the deposit agreement change at Ally. The risks have also been seen at credit unions which have raised the early withdrawal penalties on existing CDs. I have more details in this blog post.

Savings & Checking Account Rates

In the past I’ve covered savings and checking account rate changes in another weekly summary post. Each week I would publish one post with a recap of savings and checking account rate changes and another post with a recap of CD rate changes. Since there aren’t a lot of rate changes, I’m now alternating these posts. This week I’ll just publish this CD summary. Next week I’ll just publish the savings/checking summary. For both summaries I’ll include the same economic overview. You can always get the latest rates for savings/checking accounts and CDs by using our rate tables. Just use the menu on top.

Here’s the link to last week’s savings/checking recap.

Yields Accurate as of November 22, 2016

Under 1-Year CD Rates

Andrews Federal Credit Union3.01% 3-month Special Share CertificateEasy membership See review
The Palladian PrivateBank1.30% Savings Account promo 6-month rate ($10K min/$500K max)See review
Dime Savings Bank1.10% Dime Direct Money Market (1 year rate guarantee) See review
Northeast Bank1.10% Pearl Money Market Promo (6-month rate guarantee) See review
Salem Five Direct1.10% eOne Savings (guaranteed through 1/1/2017) See review
McGraw-Hill Federal Credit Union1.05% Holiday Money Market Promo (rate guarantee through 4/30/17) See review

Noteworthy Local Deals - Under 1-Year CDs

Village Credit Union2.00% ($25k) Special Rate 9-month CD8 central Iowa counties See review
Geauga Savings Bank1.40% ($25k) 7-month CD Special w/checking3 northeast Ohio counties See review
Pacific Alliance Bank1.28% ($25k) Super Savings 2-year rate guaranteeSouthern California See review
Maine Highlands Credit Union1.26% 6-month IRA CertificatePiscataquis County and 12 central Maine communities See review
Popular Community Bank1.26% Optimum Money Market Special (6-month rate guarantee)New York, possibly Northern New Jersey See review
Sterling Bank & Trust1.25% MMA Promo (6-month rate guarantee)Southern California See review
Florida Community Bank, N.A.1.20% ($10k min) Personal High Yield Money Market Promo (90-day rate guarantee) Central and South Florida See review
Geauga Savings Bank1.20% ($25k) 7-month CD Special w/o checking3 northeast Ohio counties See review
Mercantil Commercebank, N.A.1.20% ($10k min) 10-month Smart CD South Florida, NYC, and Houston, Texas area See review
Synergy Bank, SSB1.20% 10-month CD Special ($10k min)Dallas/Fort Worth area
University of Iowa Community Credit Union1.20% ($250k), 1.20% ($100k), 1.00% ($1k) 9-month CD Special48 Iowa counties, 4 Illinois counties See review
Capital One Bank1.10% Essential Savings 6-month guaranteeCT, DC, DE, LA, MD, NJ, NY, TX, and VA See review
LOMTO Federal Credit Union1.10% 6-month CDParts of New York City
EastBank, N.A.1.10% 9-month CDNYC metro area See review

1-Year CD Rates

UNIFY Financial Credit Union1.50% (2.00% 60-month Share Certificate closed after 1 year)Easy membership requirements
Connexus Credit Union1.40% ($25k) 12-month Share Certificate w/checkingEasy membership
SafeAmerica Credit Union1.40% 14-month CD Special Easy membership See review
State Bank of Texas1.35% ($100k) 1.25% ($25k) 12-month CD See review
VirtualBank1.31% 12-month CD See review
EverBank1.31% 1-year High Yield Pledge CD Internet bank See review
Connexus Credit Union1.30% ($25k) 12-month Share Certificate w/o checkingEasy membership
Live Oak Bank1.30% 1-year CDInternet bank See review
Chevron Federal Credit Union1.30% ($250k) 1-year SuperShare 250 CD See review
Popular Direct1.28% ($10k) 1-year Popular Direct CDInternet bank
Capital One 3601.25% 12-month CD
Colorado Federal Savings Bank1.25% 1-year CDInternet bank
Sallie Mae Bank1.25% 12-month CD
Synchrony Bank1.25% 12-month CD
TAB Bank1.25% 12-month CD See review

Noteworthy Local Deals - 1-Year CDs

Hartford Municipal Employees Credit Union1.75% 14-month Share CertificateHartford, CT See review
AmeriCU1.55% ($100k) 12-month Jumbo Partner Certificate9 Upstate New York Counties See review
General Electric Credit Union1.55% ($100k) 1-year Jumbo CDSouthwest Ohio
Freedom Federal Credit Union1.50% 52-week Jumbo Certificate ($25k)Harford County, Maryland See review
Idaho Central Credit Union1.50% 12-month Promo CDIdaho
Village Credit Union1.50% ($10k) Special Rate 13-month CD8 central Iowa counties See review
We Florida Financial1.46% ($10k) 1-year Jumbo IRA Certificate46 Florida counties See review
Texas Exchange Bank, SSB1.46% 12-month CDTexas See review
Red River Credit Union1.40% Special 12-month Certificate13 eastern TX counties and 11 western AR counties See review
South Shore Bank1.40% 14-month Rewards CDMassachusetts
American Eagle Bank of Chicago1.35% SUPER Saver 13-month Add-On CD SpecialChicago metro area
Bank 211.35% 14-month CDCarroll, Jackson, Pettis, and Saline Counties, Missouri See review

18-month CD Rates

Credit Union of New Jersey2.00% ($25k max) 20-month Certificate Special w/checking Easy membership See review
Consumers Credit Union1.85% ($100k) 16-month Jumbo CertificateEasy membership See review
Andrews Federal Credit Union1.81% 18-month Special Share CertificateEasy membership See review
Consumers Credit Union1.60% ($250) 16-month CertificateEasy membership See review
Veridian Credit Union1.60% 15-month Jumbo CD ($100k)Easy membership See review
UNIFY Financial Credit Union1.58% (2.00% 60-month Share Certificate closed after 18 months)Easy membership requirements
State Bank of India (IL)1.52% (2.27% 5-year CD closed after 18 months)
USALLIANCE Financial1.51% 15-month CD Special ($100k max)Easy membership
Veridian Credit Union1.50% 15-month CD SpecialEasy membership See review
NuVision Federal Credit Union1.48% (2.20% 5-year Certificate ($100k) closed after 18 months)Easy membership requirements See review
EBSB Direct1.41% 16-month EBSB CDInternet bank See review
Lake Michigan Credit Union1.40% 18-month CD SpecialEasy membership
EverBank1.40% 1.5-year High Yield Pledge CD Internet bank See review
Popular Direct1.40% ($10k) 18-month Popular Direct CDInternet bank
Live Oak Bank1.35% 18-month CDInternet bank See review
NASA Federal Credit Union1.35% 15-month CD Special Easy membership

Noteworthy Local Deals - 18-Month CDs

Collins Community Credit Union2.01% ($250k), 1.96% ($100k), 1.91% APY ($50k) 19-month CD Special 38 eastern Iowa counties See review
Cedar Falls Community Credit Union1.70% 15-month Jumbo Certificate7 Iowa counties See review
University of Iowa Community Credit Union1.70% ($250k), 1.60% ($100k), 1.50% ($1k) 19-month CD Special48 Iowa counties, 4 Illinois counties See review
Greater Iowa Credit Union1.61% 19-month CD Special33 Iowa counties See review
Texas Exchange Bank, SSB1.61% 18-month CDTexas See review
Farmers State Bank1.57% 15-month CD3 NE Iowa counties
Cedar Falls Community Credit Union1.55% 15-month Special Share Certificate7 Iowa counties See review
New Dimensions Federal Credit Union1.51% 15-month Share CertificateKennebec and Somerset Counties, Maine See review
Walpole Co-operative Bank1.50% 15-month CD SpecialWalpole, Massachusetts area See review
Norwood Bank1.50% 16-month CD SpecialMassachusetts See review
Lincoln 1st Bank1.50% 18-month Variable Rate CDNorthern New Jersey See review
Sunmark Federal Credit Union1.50% 18-month CDCapital Region, Upstate New York

2-Year CD Rates

UNIFY Financial Credit Union1.76% (2.00% 60-month Share Certificate closed after 2 years)Easy membership requirements
State Bank of India (IL)1.71% (2.27% 5-year CD closed after 2 years)
Hughes Federal Credit Union1.71% ($99k) 29-month CD Easy membership See review
NuVision Federal Credit Union1.66% (2.20% 5-year Certificate ($100k) closed after 2 years)Easy membership requirements See review
Veridian Credit Union1.65% 25-month Jumbo CD ($100k min)Easy membership
Hughes Federal Credit Union1.61% ($50k) 29-month CD Easy membership See review
Connexus Credit Union1.60% ($25k) 24-month Share Certificate w/checkingEasy membership
Bellco Credit Union1.60% ($100k) 28-month Jumbo CDEasy membership See review
Veridian Credit Union1.55% 25-month Special CDEasy membership
Chevron Federal Credit Union1.55% ($250k) 2-year SuperShare 250 CD See review
Popular Direct1.52% ($10k) 2-year Popular Direct CDInternet bank
VirtualBank1.51% 2-year CD See review
XCEL Federal Credit Union1.51% (2.00% 60-month CD closed after 2 years)Easy membership
Elements Financial1.51% (2.01% 5-year CD closed after 2 years)Easy membership
Capital One 3601.51% (2.00% 60-month CD closed after 2 years)
Bellco Credit Union1.50% ($10k) 28-month Promotional CDEasy membership See review
Connexus Credit Union1.50% ($25k) 24-month Share Certificate w/o checkingEasy membership
Service Credit Union1.50% 27-month Certificate SpecialSee review - Limited membership

Noteworthy Local Deals - 2-Year CDs

Public Service Credit Union3.00% ($10k max) Black Friday 24-month CDColorado See review
Farmers State Bank1.80% 29-month CD3 NE Iowa counties
Manatee Community Federal Credit Union1.75% ($10k) 24-month CD Manatee County, Florida See review
Idaho Central Credit Union1.75% 24-month Promo CDIdaho
Texas Exchange Bank, SSB1.6% 24-month CDTexas See review
Horizon Credit Union1.61% 26-month Special CertificateWashington, 8 Idaho and 14 Montana countiesSee review
Cedar Falls Community Credit Union1.60% 25-month Special Share Certificate7 Iowa counties See review
Community First Bank1.60% 29-month CD Special21 western Pennsylvania counties
IH Mississippi Valley Credit Union1.56% 24-month CD Quad Cities area, IL and IA
Achieva Credit Union1.55% ($75k) 24-month IRA 10 Florida counties See review
Spokane Teachers Credit Union1.51% 24-36 month Certificate Washington State and 8 Idaho counties See review
F & A Credit Union1.51% 24-35 month Term Share Certificate City and County employees in Southern California
Golden State Bank1.50% ($25k min) 25-month Special Gold CDLos Angeles County, Orange County, and the Inland Empire See review
First Federal Credit Union1.50% 25-month CD SpecialLinn County, Iowa See review

3-Year CD Rates

State Bank of India (IL)1.91% (2.27% 5-year CD closed after 3 years)
Hughes Federal Credit Union1.87% ($99k), 1.76% ($50k), 1.66% ($1k) 36-month CDEasy membership
NuVision Federal Credit Union1.85% (2.20% 5-year Certificate ($100k) closed after 3 years)Easy membership requirements See review
RTN Federal Credit Union1.85% 37-month CD SpecialEasy membership See review
UNIFY Financial Credit Union1.84% (2.00% 60-month Share Certificate closed after 3 years)Easy membership requirements
Connexus Credit Union1.75% 3-year CD w/active chk
SafeAmerica Credit Union1.71% 30-month CD Special Easy membership See review
USALLIANCE Financial1.71% 35-month CD SpecialEasy membership
Veridian Credit Union1.70% 39-month Jumbo CD ($100k)Easy membership See review
Elements Financial1.69% (2.01% 5-year CD closed after 3 years)Easy membership
Capital One 3601.68% (2.00% 60-month CD closed after 3 years)
XCEL Federal Credit Union1.68% (2.00% 60-month CD closed after 3 years)Easy membership
EverBank1.65% 3-year High Yield Pledge CD Internet bank
Popular Direct1.65% ($10k) 3-year Popular Direct CDInternet bank
PenFed Credit Union1.61% 3-year Money Market CertificateEasy membership See review

Noteworthy Local Deals - 3-Year CDs

Bent River Community Credit Union2.20% ($200k) 38-month CD Special See review
CFCU Community Credit Union2.10% ($100k), 1.75% ($25k), 1.50% ($10k) 33-month Celebration Certificate Special Tompkins and Cortland Counties, NY See review
1st Gateway Credit Union2.05% 40-month CD SpecialEastern Iowa, Western Illinois
VITAL Federal Credit Union2.01% 36-month CDSpartanburg County, South Carolina See review
Vibrant Credit Union2.00% 33-month CD SpecialIowa, Illinois Quad Cities area
American Savings Bank2.00% 39-month CD SpecialSW Ohio
Financial One Credit Union2.00% 40-month Share Certificate SpecialAnoka County, MN; northeast Minneapolis area See review
Gulf Coast Credit Union1.95% 36-month Share CertificateJim, Nueces, and San Patricio Counties, TX

4-Year CD Rates

Bay State Savings Bank2.00% 48-month CD
NASA Federal Credit Union2.00% 49-month CD Special
State Bank of India (IL)2.00% (2.27% 5-year CD closed after 4 years)
NuVision Federal Credit Union1.94% (2.20% 5-year Certificate ($100k) closed after 4 years)Easy membership requirements See review
UNIFY Financial Credit Union1.84% (2.00% 60-month Share Certificate closed after 4 years)Easy membership requirements
Melrose Credit Union1.81% 4-year CD
SelfHelp Credit Union1.81% 48-month CD
Popular Direct1.81% ($10k) 4-year Popular Direct CDInternet bank
Capital One 3601.80% 48-month CD
EverBank1.80% 4-year High Yield Pledge CDInternet bank See review
Virtual Bank1.78% 4-year eCD Internet bank
Elements Financial1.77% (2.01% 5-year CD closed after 4 years)Easy membership
Capital One 3601.76% (2.00% 60-month CD closed after 4 years)
XCEL Federal Credit Union1.76% (2.00% 60-month CD closed after 4 years)Easy membership
American Heritage Federal Credit Union1.72% 47-month Bump-Up CDEasy membership See review

Noteworthy Local Deals - 4-Year CDs

Institution for Savings2.50% ($250k) 4-year Money Market CD (also requires $250K in MMA)Parts of Massachusetts
Deere Employees Credit Union2.30% 48-month Share CertificateEmployees and retirees of Deere & Company See review
Tech Credit Union2.27% ($100k) 50-month Jumbo CompoundCDOhio See review
GPO Federal Credit Union2.25% 48-month Share Certificate Special4 New York area counties See review
Pelican State Credit Union2.19% 48-month CDRapides Parish, Louisiana
Jefferson Financial Credit Union2.17% ($10k) 48-month Share CertificateJefferson Parish, LA
Tech Credit Union2.13% 50-month Premium CompoundCDOhio See review
Beaumont Community Credit Union2.12% 48-month Share CertificateJefferson County, TX
Achieva Credit Union2.10% ($75k) 48-month IRA Plus 10 Florida counties See review
Security Savings Bank2.06% 48-month CDTri-state area of SD, IA, and MN
Member One Credit Union2.05% 48-month CDVirginia
The Freedom Bank of Virginia2.02% 4-year CDNorthern Virginia See review
Founders Federal Credit Union2.02% 48-month Share CertificateSouth Carolina
Red Rocks Credit Union2.02% 48-month Share CertificateColorado
Perpetual Savings Bank2.01% 48-month CDOhio See review

5-Year CD Rates

Northwest Federal Credit Union2.47% ($250k) 5-year Share Certificate (w/bonus points)Easy membership requirements See review
Mountain America Credit Union2.30% 60-month CD
State Bank of India (IL)2.27% 5-year CD
NuVision Federal Credit Union2.20% 5-year Certificate ($100k)Easy membership requirements See review
Signal Financial Credit Union2.16% 60-month Share CertificateEasy membership requirements See review
Chevron Federal Credit Union2.15% ($250k) 5-year SuperShare 250 CD See review
Melrose Credit Union2.12% 5-year CD
RiverLand Federal Credit Union2.10% 60-month CertificateEasy membership requirements See review
Fidelity New Issue CD2.10% 5-year New Issue CD
Velocity Credit Union2.07% 5-year Regular CertificateEasy membership requirements See review
Wings Financial Credit Union2.07% ($90k) 2.02% ($10k) 5-year Share CertificateSee review
EverBank2.05% 5-year High Yield Pledge CD Internet bank
The Vanguard Group Brokered CD2.05% 5-year non-callable CDIssued by Discover Bank
Popular Direct2.05% ($10k) 5-year Popular Direct CDInternet bank
Andrews Federal Credit Union2.02% ($10k) 60-month Jumbo CD
Elements Financial2.01% 5-year CDEasy membership

Noteworthy Local Deals - 5-Year CDs

General Electric Credit Union2.75% 5-year CDSouthwest Ohio
Lake Huron Credit Union2.63% 60-month Bonus CD Special3 mid-Michigan counties See review
Achieva Credit Union2.55% ($75k) 60-month IRA Plus 10 Florida counties See review
Lake Huron Credit Union2.53% 60-month CD Special3 mid-Michigan counties See review
Bank of Utica2.50% 5-year CDUtica, NY area
Northwoods Credit Union2.42% ($100k+) 60-month Certificate Carlton, Pine, and St. Louis Counties, MN See review
Deere Employees Credit Union2.40% 60-month Share CertificateEmployees and retirees of Deere & Company See review
American United Federal Credit Union2.40% 60-month CD (includes 0.10% rate increase)Salt Lake and Tooele Counties, Utah See review
IH Mississippi Valley Credit Union2.32% 60-month CD Quad Cities area, IL and IA
Granite Credit Union2.32% 60-month CertificateSalt Lake County, Utah See review
Cyprus Credit Union2.30% 60-month CD and Dream CD Utah See review
University Federal Credit Union2.30% 60-month CDSalt Lake County, Utah See review
Founders Federal Credit Union2.27% 60-month Share CertificateSouth Carolina

Over 5-Year CD Rates

Andrews Federal Credit Union3.01% 84-month Special Share CertificateEasy membership See review
Andrews Federal Credit Union3.00% 84-month IRA Certificate See review
Apple Federal Credit Union2.60% 120-month CD
Fidelity New Issue CD2.60% 10-year New Issue CD
The Vanguard Group Brokered CD2.40% 10-year non-callable CDIssued by Discover Bank
Andrews Federal Credit Union2.25% 72-month IRA Certificate See review
Elements Financial2.25% 10-year CDEasy membership
Apple Federal Credit Union2.25% 84-month CD
Northrop Grumman Federal Credit Union2.21% ($40k min) 84-month Bonus Term CDEasy membership
Discover Bank2.20% 10-year CD
The Vanguard Group Brokered CD2.15% 7-year non-callable CDIssued by Discover Bank
Elements Financial2.10% 7-year CDEasy membership
Navy Federal Credit Union2.05% ($100k), 2.00% ($20k), 1.95% ($1k) 7-year CDLimited membership

Noteworthy Local Deals - Over 5-year CDs

Black Hills Federal Credit Union2.70% ($200k) 7-8 year Ultimate CD (w/checking)South Dakota See review
Sharefax Credit Union2.68% ($15k) 80-month Gold Share CertificateSouthwestern Ohio
Financial Center First Credit Union2.50% 84-month Share Certificate10 central Indiana Counties (greater Indianapolis)
First National Bank (PA)2.25% 10-year CD Special ($10k)PA, MD, OH, WV
Gesa Credit Union2.20% 7-year CDWashington State
San Antonio Federal Credit Union2.20% 10-year CDSan Antonio, TX
Fairfax County Federal Credit Union2.10% ($100k) 72-month Share CertificateFairfax County, VA See review
Liberty Savings Federal Credit Union2.10% 72-month CD Easy membership See review
Ent Credit Union2.10% 84-month Certificate9 Colorado counties See review
Indiana Members Credit Union2.02% 84-month CD17 central Indiana counties
PeoplesChoice Credit Union2.02% 84-month CDYork and Cumberland Counties, Maine

CDs Removed Due To Low Rates Or Expired Specials

CDs Removed, No Longer Available - Nationwide


CDs Removed, No Longer Available - Local

Community Financial Services Bank2.02% 33-month CD Special KY, IN, IL, MO, and TN See review
Community Financial Services Bank2.27% 66-month CD Special KY, IN, IL, MO, and TN See review
American Eagle Financial Credit Union1.50% 14-month CD SpecialHartford, Middlesex, New Haven, and Tolland Counties, CT See review

CDs Removed, Rate Too Low - National

iGObanking0.15% 12-month iGOCD
E-LOAN.com1.15% ($10k) 1-year CD
Capital One 3601.35% 18-month CD
Elements Financial1.35% (2.01% 5-year CD closed after 18 months)Easy membership
Capital One 3601.60% 36-month CD
Veridian Credit Union1.60% 39-month Special CDEasy membership See review
Alliant Credit Union1.70% ($25k), 1.65% ($1k) 48-month CD
Capital One 3602.00% 60-month CD
XCEL Federal Credit Union2.00% 60-month CDEasy membership
UNIFY Financial Credit Union2.00% 60-month Share CertificateEasy membership requirements

CDs Removed, Rate Too Low - Local

The Summit Federal Credit Union1.25% ($75k) 1-year Jumbo CertificatePortions of western NY State See review
Ardent Credit Union1.25% 30-month Flex CD5 SE Pennsylvania counties See review
Federal Employees Credit Union2.00% ($100k) 48-month CDFederal employees and retirees See review for limitations

Post Publication Edits

11/23/16: Hartford Municipal Employees Credit Union 14-month Share Certificate added.

11/23/16: Financial One Credit Union 40-month Share Certificate Special added.

11/25/16: American Eagle Financial Credit Union 14-month CD Special no longer available.

11/25/16: Fidelity New Issue CD 10-year New Issue CD rate increased.

Anonymous   |     |   Comment #1
Thanks for the great list Ken! There is finally a good 5 year CD deal in Michigan 2.63% except I don't live in the qualifying counties to join the credit union.........go figure. I still have 4 years left on the 2.5% Vibe credit union CD I opened last year so I really don't want to lock up too much cash with rising interest rates anyway. I'm thinking the FED may surprise us with a .5% hike in December as Yellen is on her way out and to make Trump look bad and Obama look good as he leaves office. Just a guess. This would cause CD rates to move up at long last.
Anonymous   |     |   Comment #4
Even Trump will probably want interest rates to stay low while he gets his economic plan started......I would not expect rates to increase much for 2-3 years......But then again I didn't expect Trump to win so what do I know?
Anonymous   |     |   Comment #6
Now that sounds like an honest statement I really agree with.  I doubt any drastic changes are going to occur overnight.  It's not like flipping a switch and getting an instant response. 

And yes, Trump sure did through Hillary and her elite following into shock and even surprised a great many of his supporters.  
Anonymous   |     |   Comment #9
You don't know Yellen is on her way out. She is there through 2018.
Anonymous   |     |   Comment #48
Trump immediately gets 2 appointments to the FED board of Governors.  These voting members of the FOMC will put a lot of pressure on Yellen's last year as Chair.
Anonymous   |     |   Comment #20
How would a .5% hike in the Fed funds rate "make Trump look bad and Obama look good"?  I don't get it, - besides how ludicrous it is to suggest the Fed would blithely take such momentous action so motivated.
Anonymous   |     |   Comment #25
To the liberal #20 To try and crash the market for Trump. You still don't get it because you don't understand that the FED is political. To #9 Trump is going to ax Yellen asap as she is a inflation dove and politically tied to Obama watch and see.
jimbeau   |     |   Comment #2
For the first time in a long time, inflation as measured by the CPI-U for the last 12 months is over 2% (2.1%).    That means you have to go out to a 5 year CD to beat TRAILING inflation.   If inflation increases are larger than interest rate increases, this is a losing proposition.  As a result of this, I'll probably be shifting money from CD's into iBonds and TIPS over the course of the next year. 

A while back, Ken had a good article about iBonds.  With a fixed rate of 0% plus the 2.67% inflation based rate, iBonds suddenly became an attractive again.   So, we just popped for the maximum a married couple with no tax refund can purchase in a year (20K).  iBonds compare favorably with 5 year CDs.  Up until 5 years, there's only a 3 month interest rate penalty for cashing them in. 

TIPS still have a way to go before they'll be worth considering.  Today, the yield to maturity on TIPS went positive since sometime last year.  It's a whopping 0.01%!    Basically, all that means is that the only interest you'll be making on the deal is the inflation factor.   Due to last year's deflation, TIPS have underperformed pretty much any CD.  This may finally be changing.

The big problem with TIPS is like brokered CD's you have to sell them on the secondary market if you want to bail on them.  If interest rates rise, that's a guaranteed loss.  So, you'd better be sure to hold them to maturity if you want to prevent the very real possibility of losing principal on the deal.   However, they are an attractive tool of preserving principle against rising inflation.
Anonymous   |     |   Comment #3
Careful folks with that TIAA promotion a few days ago.......I recently saw the disclosure and it says the promo is ONLY intended for the person that receives the invitation. You might have the promo code to put in but I would not depend on that......I doubt you will get your $250 if you did not get the invite.
Anonymous   |     |   Comment #21
#3 That the offer is intended only for the person receiving the invitation hardly means it won't work for anyone else.  Disclosures typically use boilerplate language that can easily be misconstrued if you don't understand the motivation behind it (protection from liability).  I used the TIAA promo code with no hindrances, - the rep has to apply the code to each individual applicant's account and see if it "takes" and mine did (as it would with you also).  Subsequently you'll receive an account opening confirmation (by mail) restating the offer terms so there's no mistake.  Your concerns are unfounded.
Anonymous   |     |   Comment #23
I'm still not doing it. They will likely deduct the $250 even after it is initially awarded. And all they have to do is point to the disclosure. Have fun earning .64%
Anonymous   |     |   Comment #5
Thanks, Ken. You do a wonderful job with your website.
Anonymous   |     |   Comment #7
Every expert said that if Trump wins the stock market would dive and gold would soar. Since Trump's victory stocks reach new highs daily and gold is collapsing. I think they were the same experts that said all the polls had Hillary winning.
Anonymous   |     |   Comment #8
I didn't know this was a stock market blog site. Perhaps you need to go to one.
Bozo   |     |   Comment #11
To: Anonymous (comment #8).

Ken's blog is open to comments by all who invest. Investing is not limited to just bank accounts, CDs, or the like. Investing also includes the stock market, the bond market, the real estate market, and alternative investments. The point of Ken's blog is to explore the different alternatives, and compare and contrast deposit accounts (in their various forms) to the alternatives. Discussion of the stock market is entirely relevant.

Historically, risk was to be taken on the "equity" side of one's investments. Absence of risk used to be taken on the bond fund side. That whole paradigm has been turned on its head by the bursting of the bond bubble, and the tanking of bond funds. Should we not discuss this?

I respectfully submit Ken's blog is an excellent forum for this discussion.
Anonymous   |     |   Comment #12
Well said, Bozo, thanks for posting it.
jimbeau   |     |   Comment #14
Yet another comment vigilante?    
Bozo   |     |   Comment #10
To: Anonymous (comment #7).

Your comment is well-taken. Many tea-leaf readers the night of November 8 predicted the end of the world. The Dow futures plunged, at one point, by 800 points. The next day, well, we know what happened. In the two weeks following the election, the yield on the 10-year Treasury spiked. It has now moderated. Higher than it was on November 7, certainly. But it seems to have settled at a range around 2.3% (+/-).

As time goes on, I suspect we will see more moderation from the President-elect on his hot-button issues. While some DA readers might regard this as apostasy, I see it as the reality of governance.
Anonymous   |     |   Comment #13
Just proves the so called "experts" are just "media talking heads" and not really expert at anything but propaganda.
Anonymous   |     |   Comment #17
Would you take financial advice from someone who uses an I'd bozo ;)
Anonymous   |     |   Comment #18
No, I don't give bozo's comments any more credibility than I do the media talking heads.  My comment, #13, was in response Anonymous comment #7, with which I whole heartedly agree.
Anonymous   |     |   Comment #22
There are political "bubbles" as well as economic ones.  In regards to both Donald Trump and the stock market watch things go "pop" before too much time has elapsed.  Good luck to all in face of the consequences.
Anonymous   |     |   Comment #24
That was my thoughts too.  Like the old saying when it comes to stocks:  "buy on rumor, sell on fact".  That's how traders make their money. 
Ed (anonymous)   |     |   Comment #15
A rising rate environment doesn't translate into higher savings/CD rates. All the talk over the past 2 years of a rising rate cycle resulted nothing more than two 0.25% increases (measly 0.5%).

It will be a cold day in hell before we see 5% CD rates, especially with a slowing economy. I would rather lock in any 3% CDs I see now as opposed to waiting in anticipation of a rate increase. As long as the early withdrawal penalty isn't too steep, you have nothing to lose.

I am still working, so I have income still streaming in. For me to lock in 3% rates over the long term is not really a problem because I still have money coming in.
Anonymous   |     |   Comment #16
When you retire you better have income still streaming in. The source does not matter but the flow certainly does.
Anonymous   |     |   Comment #19
Agree with you. Doubt we will see 5% CDs again or at least for a long time. I took the Andrews 3% for 7 years only because of the low EWP. If rates skyrocket I can pull the funds. I have A Popular CD that I just closed but I will wait a few weeks to see what happens. Also looking at Muni's.
Anonymous   |     |   Comment #26
Ed First of all we only had 1 FED rate hike in 8 years and that was only .25%. Interest rates then dropped even further after that hike. My point is that now with a second hike and a pro business president coming into office you will finally see interest rates move up on long term CD's after December. Already treasuries and mortgage rates as well as inflation expectations have all started to rise. You probably already locked in long term CD's because you were expecting a Hillary win(which would have been a wise choice had she won) and are now trying to justify your actions. I'm not locking in any 5 year or longer CD's as I'm waiting for the yields to rise first.
Ed (anonymous)   |     |   Comment #27
Sorry, but the Black Friday Special at Andrews occurred AFTER the election. I opened it despite the Trump win. Do you know why? Despite his pro-business sense, he is also pro-infrastructure building. He wants $1T in new construction. Where will the US, which is over $18T in DEBT, be able to get that money??? It is either more borrowing or more money printing....

You see, either way rates will not go up but down under those scenarios. The rise in treasury rate these 2 weeks are a reaction to the rise in the stock market. People are dumping bonds, in anticipation of a measly 0.25% rise, to jump on the stock market band wagon.

However, I see the business cycle slowing whether Trump decides to pursue a fiscal stimulus or not. He may delay the inevitable, but the economy is slowing (look at restaurant sales, look at car sales, look at retail). Once the market sees a recession, they will move back into bonds...rates will go down again. Sorry, but I don't buy the hype. "Make America Great Again" is a great slogan, but it is hard to do when you are over $18T in debt, and have most of your manufacturing sector gutted and outsourced.
Anonymous   |     |   Comment #28
No more than guesses.  Does anyone really know what's going to happen?
Anonymous   |     |   Comment #29
That's what I thought Ed you are locked in for 7 years just as rates are finally going up. You will end up being long and wrong as there will definitely be a FED hike in December and most likely a few more next year. Trump will not keep interest rates artificially low at 0% for 8 years like Obama did. This is already shaping up to be a good Christmas season as optimism is returning to the consumer. Trump isn't even in office yet and things are already changing for the better. Trump will not be doubling the debt like Hillary would have and he will be looking to cut spending to pay it down or at least not add as much to it. He was the only candidate who even mentioned the out of control debt. I'm heavy in cash and high yield dividend paying stocks waiting for interest rates to rise or stocks to drop to take advantage of either opportunity. 
Anonymous   |     |   Comment #30
Trump will be giving all American tax payers a massive stimulus in the form of gutting Obamacare saving thousands in healthcare costs while cutting tax brackets and doubling the standard deduction at the same time. This will cause inflation and interest rates to rise as consumers will have more money to spend. Later savers will also have more money to spend because of higher interest rates.
Ed (anonymous)   |     |   Comment #31
Again, you failed to see the strategy of a long dated CD with a mild withdrawal penalty. The CD is long term with a guaranteed interest of 3%, while you are the one who had locked in your money in the low 1% cash or risky stock market at all time highs. I have an above average rate of return with my principle protected from any downturn, AND the ability to cancel the CD with a mild penalty of 6 months (not bad for 7 years).

You have yet to answer how Trump will pay for his infrastructure building or his huge tax cuts. If you cannot answer the question of where that money will come from, then it is obvious it has to come from more borrowing or quantitative easing - both of which lowers rates.

You have argued that once Trump will be in office, the economy will roar back with the gutting of Obamacare with tax cuts to the American consumer. For that I ask you again....where will that money come from for the tax cuts, and what plan will be used to replace the healthcare bill (over 4 years in the making) for over 250 million insured people? Every President over the past 30 years had contributed to the debt....due pretty much to the interest we have to pay for our $18T in bonds, and to fund social security and Medicare. If you can answer how Trump will not add to that debt, then I would like to hear it.

Change will not happen as rapidly as you might think come 2017. As Yellen remains in office until 2018. The more she raise rates, the more your stocks will tank. I am not sure how that can be justified as an advantage for someone that is holding stocks at all time highs. We share see who comes out better after 2018, you or me.
Bozo   |     |   Comment #32
Ed, I guess where you lose me is why increased borrowing depresses rates. Kindly explain. In addition, the bond market seems to view Trumponomics as justifying higher yields on the 10-year. Is the bond market wrong?
Anonymous   |     |   Comment #33
Could be.  Only time will tell.
Ed (anonymous)   |     |   Comment #34
The Treasury sells US debt when we need to borrow, and services the interest paid on that debt. Outside of foreign buyers, the Fed is currently the largest and last buyer of US debt. Since the Fed also controls US interest rates. If more US debt is issued, the more it has to buy to pick up its slack. In order to buy those debt, the Fed prints money and keeps the debt on its balance sheet (which is now over $8T). Refusing to buy that debt will result in lack of demand for the Treasuries, which in turn will result in a spike in interest rates. It may seem good to you that interest will spike, but that in turn mean the US Treasury will need to increase its payments in interest obligation, something it has a hard enough time doing. That is why the Fed helps out by keeping interest rates low, so our government can service that debt. You see, it is all a vicious cycle.

Before the Great Recession, the Fed has a relatively clean balance sheet of $500 M. But now is a totally different story. Raising interest rates to a point where the Treasury has a hard time meeting interest obligations will put the very bonds that the Fed had bought in a jeopardy of default. Hence the Fed with its $8T in Treasury obligations will not raise the interest rates too steeply to hurt the very government it has bought its bonds from.

As for the recent jump in interest rates, it is just speculation. Bond buyers are anticipating continuous interest rate rising from the Fed. What I had just explained to you pretty much ensures that will not happen. As soon as these traders realize that it will come down again. You should not read too much into short term spikes in the market....isn't it how some people got it so wrong that the stock market will crash and gold will spike if Trump won, when exactly the opposite happens? As Bernanke has said, we will not see high rates in his lifetime....something he had hinted as to the direction of where the Fed is going.
lou   |     |   Comment #35
Nobody knows where interest rates are going. Stop pretending as if you have some crystal ball. Some of the greatest investors and hedge fund managers have been wrong regarding their interest rate forecasts. Your guess is as good as mine, although I'm betting interest rates will be higher this time next year. 
Ed (anonymous)   |     |   Comment #36
The facts I had laid out are just that....facts. I am not making up any of the information above, so I am not PRETENDING to have a crystal ball, because it is common knowledge.

It may be true that no one knows what the SHORT term interest rates will be, but LONG term interest rates cannot be too high or you will put the Treasury into default...aka our tax dollars.
Anonymous   |     |   Comment #37
Facts v. opinion...Ed, your opinion (and just one example) is the following quote: "Raising interest rates to a point where the Treasury has a hard time meeting interest obligations will put the very bonds that the Fed had bought in a jeopardy of default. Hence the Fed with its $8T in Treasury obligations will not raise the interest rates too steeply to hurt the very government it has bought its bonds from."

Now that is a fact as to your opinion!
Ed (anonymous)   |     |   Comment #39
Currently 1/3 of all our taxes is to pay for debt obligation (interest). If a person such as yourself who need to use 1/3 of your income to pay off the interest alone, what happens if you are required to pay 2/3 if the interest rates on that debt rises to 5%? Can you tell me you can survive and not default when you have to use 2/3 of your income just to pay for interest?

It is a fact. Whenever you borrowed heavily, the higher the interest rate on that debt, the less disposable income you have for anything else. The same it is for our government. And that is not an opinion, when the interest rate becomes too high such that it is onerous for the government to pay.
Anonymous   |     |   Comment #40
With increased rates the fed will buy back bonds at a reduced price on the open market
Anonymous   |     |   Comment #44
No Ed, the same scenario that applies to us as individuals does not apply to our Federal Government.  If the government's outflow exceeds the income, our government just raise the income (our taxes).  If our outflow exceeds our income, we can not  just demand more income from our employers. 

That applies to government on all levels, local, state, and federal.  Need more income, just raise taxes.  That is why the middle class has all but disappeared.
Ed (anonymous)   |     |   Comment #46
To comment #44, technically you are incorrect. Maybe in a totalitarian government, the government can raise taxes anytime they want. However, you happen to live in the US, where the politicians are VOTED into office. Name me one candidate that won a seat in government by promising to RAISE taxes....

You remember G.W. the first, right? (Read my lips, no new taxes?) what happened the next election after he renege on his promise? You see, it is people like yourself that thinks you can have it both ways....you want lower taxes (you probably voted for Trump because he promised to CUT taxes, while INCREASE infrastructure building), but you cannot answer WHERE we will get that money to do so. It is simple math, and not even a genius can figure that out.

Any politician foolish enough to promise to RAISE taxes....just so to satisfy savers like yourself to earn a higher interest rate....will never be voted in.

As to some other commenters here, no one claims to be a genius around here. If I was a genius, like you said, I would be a millionaire and not even bother to post here (even though I can bet a few millionaires still buy CDs and look at this site from time to time). What I explained was common knowledge. If you didn't even knew that, I am surprised that you know LESS than what most common people know. Ciao!
Anonymous   |     |   Comment #47
Ed Obama won twice and he did raise taxes! Not only for the rich but for the middle class in the form of higher mandatory health care costs aka Obamacare and endless 0% interest rates stealing from savers like myself.  Anyone who voted for Obama should have known going in that interest rates were going to stay at 0%, taxes were going up and there would be no tax cuts for the middle class. That's why I voted for McCain and Romney(who was going to take away the interest tax btw). I have a million and used to earn $60,000 a year in FDIC insured income during my retirement until Obama came to town! Then my income dropped to $10,000 a year forcing me into the stock market and monthly paying dividend stocks in order to seek some yield on my lifelong savings. Now I'm able to eek out $30,000 a year with 40% of my cash at risk in the stock market. I thank Obama daily for ruining my retirement income after I saved and sacrificed my whole life so that I could have a decent retirement. If you think a million is rich think again you will just be able to scrape by if interest rates unexpectedly drop this low. Oh but I'm sure you still think this was somehow all Bush's fault. 
Anonymous   |     |   Comment #49
Obama Obama Obama
someones got a million bucks
poor poor them
Ed (anonymous)   |     |   Comment #50
I am not a Democrat or a Republican, because I think both parties are bought and paid for. I just read the tea leaves. And the Tea leaves says that our government will continue financial repression in order to meet its financial obligations (debt interest payment, social security, medicare, etc). And it financial repressions, you get low interest yield (aka Japan).

I don't play politics, I just read their playbook.
Bozo   |     |   Comment #38
Lou, folks who predict anything (although you are entitled to your opinion) remind me of all those old Abbott and Costello clips I saw as a lad on our black and white TV. As in "who's on First?"
lou   |     |   Comment #41
Bozo, I'm tempted to say to all these geniuses who are certain about the direction of rates: why not put your money where your mouth is. You can easily buy 10-yr T-Note futures and become independently wealthy if you're right. Why are these people buying measly CDs when they can be richly rewarded for their  clairvoyance?
Anonymous   |     |   Comment #42
I noticed that attitude here too, Iou.  If some of the "know it alls" actually knew something, they would be multi-millionaires by now and wouldn't be the least concerned with posting here. 
Anonymous   |     |   Comment #43
I am putting my money where my mouth is by holding a large amount of cash at the moment. I have 4 years left on a 4 year CD earning 2.5% and 6 months left on a 3 year CD earning 2.28%. 40% of my cash in monthly paying dividend stocks yielding a average of 8% APY and 60% cash earning 1.26% awaiting 1. Higher yielding 5 year CD's and or a stock market drop to dollar cost average down in dividend paying stocks. If I thought like ED I would have locked up 7 year CD's and been 80% or more invested in the market. I'm retired btw so I'm investing for a combination of yield and safety.
Anonymous   |     |   Comment #45
No question that ED's strategy is winning for the moment but what I'm saying is that things may look substantially different in a year or two with Trump at the helm. Only time will tell but I'm betting on higher rates. I have been watching the FED for 30 years and I locked up 80% of my cash for 5-7 years @ 5-6% APY the weekend before interest rates started to drop back in 08. So I have no problem making these type of calls. I also said that Obama would keep rates @ 0% for his entire term in office and here we are 8 years later and that prediction held up quite well.
Bozo   |     |   Comment #52
To: Anonymous (Comment #45).

Locking 80% of your cash at 5-6% for 5-7 years back in 2008 was indeed a good call. By definition, however, all those CDs have now matured. Is your cash now "on the sidelines"? Just curious.
Bozo   |     |   Comment #51
To: Anonymous (Comment #43).

I am also retired, safety and yield (in that order) being also important to me. Thanks to Ken's blog, over the past decade or so, I have been able to ladder IRA CDs with some modest success. Retirees always have a somewhat different take on safety and yield.

Economists call it "risk tolerance". Plainly stated, folks pushing 70 (as am I ) and planning for RMD next year, tend to be more risk-averse. I could abide losing a few bps to inflation in my ladder (which, might I add, has never occurred thus far). I could not abide a 50% haircut in my portfolio, as happened to some in 2008.

Accordingly, I began to harvest IRA equity gains, from time-to-time, over the past 12 years (starting in 2004), and plop them in IRA CDs. Did I lose out in terms of opportunity cost? Sure. Did I sleep better at night? You betcha.

Mind you, winding down a 60/40 asset allocation to 40/60 (from age 55 to 65) takes a certain amount of discipline. Winding down 40/60 to 30/70 by age 70 takes even more.
Anonymous   |     |   Comment #53
Great comment Bozo and yes I do have a great deal of cash on the sidelines currently awaiting deployment either in dollar cost averaging down in monthly paying dividend stocks, paying off my mortgage or higher yielding CD's or possibly a combination of all three. Back in 08 I learned that my risk tolerance is having only 50% of my cash in the stock market. Prior to 08 I had a 80% stocks 20% cash mix now I have a 40% stocks 60% cash mix. As Clint Eastwood once said "A man has to know his limitations".
#54 - This comment has been removed for violating our comment policy.