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Best Money Market Rates & Accounts – November 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Updated November 1, 2018

Traditional banks are paying very low interest rates on money market accounts. For example, BB&T pays between 0.01% and 0.04% APY. Fortunately, you do not need to settle for such ridiculously low rates. You can easily find the best money market rates at internet banks paying 1.85% or more. If you put $50,000 into BB&T’s account at 0.04%, you will only earn $20 of interest over one year. That same money in an account paying 1.85% would earn you $925 of interest. And you can typically open and fund an online money market account in less than 10 minutes. Also, the differences between savings accounts and money market accounts are narrowing because rates on money market account are increasing each year. You can currently earn the same top rate with a savings account from one bank and a money market account from another.

MagnifyMoney searches over 12,000 banks and credit unions to find the money market accounts paying the highest interest rates. Competition has been increasing and there is a pricing war. As a result, this month there are a lot of new names on the list (many of which you probably will not recognize). Here are the best rates for November 2018:

1. Capital One – 2.00% APY, $10,000 minimum balance to earn APY

360 Money Market from Capital OneYou may think of credit cards when you think of Capital One, but don’t overlook their deposit accounts. The 360 Money Market account currently comes with a great 2.00% APY. While the bank doesn’t require you to have a minimum amount to open the account, you will have to maintain a balance of $10,000 or more to earn their high rate. If your balance falls below that amount, you’ll earn an APY of 0.85%. We really like that Capital One doesn’t impose any monthly fees, and while they don’t offer checks, they do provide you with an ATM card that you can use to withdraw up to $1,000 per day. While you’re able to make an unlimited amount of withdrawals from an ATM per month, remember that you’re limited to making six certain transfers and withdrawals per cycle due to Federal Law. To access this account, you may do so online, in person, or on-the-go through Capital One’s mobile app.

LEARN MORE 

Member FDIC

2. Favorite Online Package: Ally – 0.90% APY, no minimum deposit and link to free checking

Online Savings Account from Ally BankAlly Bank is a very popular internet-only bank. If you keep a daily balance of $5,000 or less, you will earn the 0.90% APY. If you’re able to keep a minimum daily balance of $25,000 the APY increases to 1.00%. Although the interest rate on the money market account is not the highest, Ally does offer a very competitive overall package – particularly if you link the account to an Ally checking account. The checking account has no minimum balance and no monthly fee. You can link your money market account to your checking account to provide overdraft protection. Money would be transferred to your checking account with no transaction fee if you ever made a mistake. You would be able to access your money market account with your Ally ATM card, which has free AllPoint access and up to $10 of non-Ally ATM fees reimbursed every month. This money market account is a nice way to provide yourself with overdraft protection while earning interest. If you don’t need check-writing capabilities on your savings, you would still be better off with Ally’s savings account.

LEARN MORE Secured

on Ally Bank’s secure website

Member FDIC

3. Highest Overall Rate: Northpointe Bank – 2.30% APY, $25,000 minimum balance, checks and debit card available

Liquid Money Market from Northpointe BankNorthpointe Bank, is a fairly large bank located in Grand Rapids, MI. They have over $1 billion in assets and have only been around since 1999. Currently, they’re offering a 2.30% APY on their money market account. While you’ll only need $1,000 to open the account, you’ll have to have a minimum balance amount of $25,000 to earn the high APY. If you have a balance between $1,000 and $2,500, you’ll earn an APY of 0.20%. If your balance is between $2,500 and $25,000, you’ll earn 0.25% APY. Once your balance exceeds $1 million, the APY will drop to 0.50%. This account comes with a debit card and checks. Northpointe Bank does not charge a monthly maintenance fee, but will charge a $15 Excess Transaction Fee each time you exceed six certain transactions a month. The offer online banking and have a mobile banking app.

on Northpointe Bank’s secure website

4. High Rate: Pacific National Bank – 2.25% APY, $5,000 minimum balance to earn APY

Pacific National Bank has quite an interesting history. In 1982, Banco Del Pacifico Ecuador (BPE) decided to establish Banco Del Pacifico International in Miami, FL as an Edge Act bank. The Edge Act allowed national banks to do international banking through divisions chartered by the Federal Reserve Bank. By 1985, Banco Del Pacifico International decided to become a national bank charter and changed its name to Pacific National Bank. Since this change, the bank has acquired over $454 million in assets. The bank initially offered its services to South Florida residents, but decided to expand to all U.S. residents with a valid Social Security Number in 2016.

Today, Pacific National Bank is offering an online special on its money market account. With a minimum deposit of $5,000, you could earn an APY of 2.25%. You’ll need to maintain that amount in the account on a daily basis to waive the monthly maintenance fee of $25 and to continue earning the high rate. Check writing is available with this account, but keep in mind that you can only make six certain transaction within a month due to federal law. If you exceed six certain transactions within a month, Pacific National Bank will charge a fee of $20 per additional transaction. You may also make ACH transfers, free of charge, without any limits after the initial funding. In addition to banking online, the bank offers a mobile banking app for your convenience.

on Pacific National Bank’s secure website

5. High Rate: BankPurely – 2.25% APY, $25,000 minimum balance, ATM access

BankPurely
BankPurely, a division of Flushing Bank, currently offers a 2.25% APY on their money market account. You’ll have to either deposit a minimum amount of $25,000 or grow your balance to that amount in order to earn interest. If you’re not able to deposit that amount, you may want to go with Sallie Mae since they have a great rate for a lower deposit amount. However, BankPurely does provide an ATM card, which gives you access to surcharge-free ATMs within the Allpoint Network. Just keep in mind that you’ll be limited to withdrawing $1,000 per business day. Per Federal law, you’ll also be restricted to making six transfers per month. You’ll have access to online banking as well as to their mobile banking app to manage your account. Plus, if you open an account with BankPurely, they’ll plant a tree.

LEARN MORE Secured

on BankPurely’s secure website

Member FDIC

6. High Rate: TIAA Bank – 2.15% APY, $5,000 minimum to open, ATM access, 1st year intro rate

Yield Pledge Money Market - 1st Year Intro Rate from TIAA BankTIAA Direct and EverBank recently merged to create TIAA Bank. Currently, the bank is offering a 1st year intro rate on its Yield Pledge Money Market account. If you have $5,000 to open the account, you’ll receive a 2.15% APY. After the first year, the APY drops depending on your account balance. Fortunately, the APY won’t fall below 1% even if you have a really low balance and TIAA Bank promises to always have yields within the top 5% of its competition. Some other perks of this account are that it doesn’t have a monthly account fee and allows you to have access to ATMs via a Visa debit card. In addition to doing all of your banking online, you’ll be able to manage your account on TIAA Bank’s mobile app.

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on TIAA Bank’s secure website

Member FDIC

7. Top Choice: Sallie Mae – 2.20% APY, no minimum balance and checks available

Money Market from Sallie Mae BankIf you have student loan debt, you probably are not very excited to see Sallie Mae at the top of this list. However, many people are unaware that Sallie Mae also operates an internet-only FDIC-insured bank with some of the best interest rates in the country. You can earn 2.20% APY, compounded daily and paid monthly. There is no minimum balance and no monthly maintenance fees. You will have check-writing capabilities (although the standard money market limit of six per month applies to this account). The easiest (and best) way to fund and access your funds is via electronic transfer from your existing checking account. If you want a simple account with no fees and check access – this is a good bet. Sallie Mae has just recently increased the APY, making this one the best rates in the country.

LEARN MORE Secured

on Sallie Mae Bank’s secure website

Member FDIC

8. High Rate: Bank7 – 2.05% APY, $5,000 minimum balance, checks and ATM access available

Bank 7
Bank7, established in 1901, originated in Oklahoma, but has been expanding its reach to Kansas, Texas, and now online. In addition to their original banking products, they have created accounts that specifically suit the needs of online consumers. One of those accounts is their High Rate Online Money Market. This account requires $5,000 to open and awards accountholders with a 2.05% APY. The account comes with check writing capabilities as well as the option to get a Visa debit card, which will provide you free access to Bank7 ATMs as well as to Allpoint Network ATMs. One downside to this account is that if the balance falls below $5,000, you’ll be hit with a $15 charge each month your balance falls below that amount. In addition to their online banking platform, they also have a mobile app.

LEARN MORE Secured

on Bank 7’s secure website

Member FDIC

9. High Rate: earn.bank – 2.02% APY, $100 to open, $0 minimum balance, but no check-writing

earn.bank is a division of Silvergate Bank, a state-chartered bank headquartered in San Diego, CA. The state-chartered bank has over $1 billion in assets, and your deposit would be FDIC insured up to the legal limit. Silvergate Bank created earn.bank to provide “a transparent, powerful savings vehicle that will help you meet your savings goals. At 2.02% APY, the internet-only bank is certainly starting out strong. You only need $100 to open the account and there isn’t a minimum balance requirement to earn the high rate.

A few downsides to this account include a $10 monthly maintenance fee that comes with a steep balance requirement if you want it waived. You would need to maintain an average daily balance of $10,000 to avoid the monthly fee. The account does not come with check-writing privileges and there is no ATM access. You’ll also want to make sure you’re enrolled in eStatements as you’ll be charged a $25 fee for each paper statement you receive. You can deposit your funds via ACH (electronic transfer), which can take a couple of days. Just remember: there is a limit of 6 withdrawals per calendar month.

on earn.bank’s secure website

10. Virtual Bank – 2.01% APY, no minimum balance to earn APY

eMoneyMarket from Virtual BankVirtual Bank, a division of IBERIABANK, is currently offering an introductory rate on their money market account that is the highest available. This rate is guaranteed for 12 months and will adjust to the standard rate that is in effect at the time. New customers can earn the 2.01% APY by depositing a minimum of $100. While there isn’t a minimum balance requirement to earn the APY, there is a balance requirement to avoid incurring the $5 monthly service fee. All you’ll have to do is maintain a daily minimum balance of $100 and they’ll waive the monthly fee. While this account doesn’t have any check writing capabilities, you can easily move money in and out of the account via ACH. Virtual Bank has a mobile app, that has the mobile check deposit feature, in addition to their online banking platform.

LEARN MORE Secured

on Virtual Bank’s secure website

Member FDIC

11. High Rate: Self-Help Credit Union – up to 1.74% APY, $500 minimum deposit and minimum balance

Money Market from Self-Help Credit UnionSelf-Help is a credit union that anyone can join. If you don’t live, work or worship in one of their eligible counties, you can join by donating $5 to the Center for Community Self-Help. The contribution is tax deductible and will make you eligible for credit union membership. (You can learn more about how to join the credit union here.) At a credit union, your funds are insured up to $250,000 – but it is by the NCUA instead of the FDIC. The money market offers an APY of 1.74% on balances from that are at least $500. You also need to maintain the balance during the month – otherwise you will be charged a monthly maintenance fee. You are allowed 6 free withdrawals or transfers from the account each month (including checks).

LEARN MORE Secured

on Self-Help Credit Union’s secure website

NCUA Insured

Special Mention: Great Rate for Small Deposits: Premier Members Credit Union – 4.00% APY up to $2k

Premier Members Credit Union

Premier Members Credit Union is open to anyone willing to make a $5 donation Impact on Education, a charity for the Boulder Valley School District. This credit union is currently offering an incredible rate of 4.00% with only $5 to open the account. You can earn this APY on balances up to $2,000. Amazingly, even if you grow the balance up to $5,000, you’ll earn 1.49% APY. As the balance increases, the APY decreases to the following:

  • $5,000.01-$10,000: 0.75%
  • $10,000.01-$50,000: 0.50%
  • $50,000.01-$100,000: 0.40%
  • $100,000.01-$250,000: 0.35%
  • $250,000.01+: 0.30%

Premier Members Credit Union rewards low balance savers by placing the highest rate with the lowest deposit, but if the balance grows they start using a reverse tier system where they blend the APY as the balance grows. Checks are available with this account, but you can only make six withdrawals per month. Each additional withdrawal will be assessed a $10 fee.

LEARN MORE Secured

on Premier Members Credit Union’s secure website

NCUA Insured

3 Questions To Ask Before Opening A Money Market Account

1. Should I open a savings account or a money market account?

Many years ago, money market accounts were higher risk and paid higher returns. The financial crisis of 2008 changed all of that. Money market accounts are now FDIC-insured up to the legal maximum ($250,000 per institution per individual). Interest rates are now very similar – and there is no material difference. In other words – choose whichever account you want.

In general, you tend to get slightly lower interest rates on money market accounts because you have check-writing capabilities. The best savings accounts pay at least 1.50% APY – very similar to the rates on this page. But at Ally, for example, you can get 1.35% APY on a savings account (no check-writing) and 0.90% on the money market account (with check writing).   

We have written a full explanation of the difference between money market and savings accounts here.

2. Am I willing to make a longer term commitment? 

Savings accounts and money market accounts pay much lower interest rates than CDs. Right now you can easily get a 1-year CD paying 1.85% APY (with only a $2,000 minimum). You can find the best CD rates here. If you build a CD ladder, you can take advantage of 5-year rates that are now as high as 3.00%.

Money market accounts are great places to keep money that you might need immediately. But the interest rate on a money market account can change right away, at the bank’s discretion. To lock in a higher interest rate, you should consider a CD. If you need to get access to your CD early, would forfeit interest (typically from 3-6 months). In most circumstances, putting more of your money into CDs can really help boost your returns.

3. Is a money market account the same as a money market fund? 

No, money market accounts (offered by FDIC-insured banks) are not the same as money market funds (most likely sold by your broker). In fact, we really don’t know why people even buy money market funds in the current environment.

For example, Vanguard offers the Prime Money Market Fund. Like other money market funds, this one “invests in short-term, high-quality securities.” Its objective is to keep the fund trading at $1 and generate a decent return. Right now that return is 1.00% – a bit lower than the returns you see from the money market accounts listed in this article. However, money market funds do not have FDIC insurance.

Most people compare the return of a money market fund (sold by their broker) to the interest rate paid by a traditional bank (0.03%, sold by their local bank teller). As a result, they are willing to take the risk of a money market fund. However, as you can see from the best money market accounts in this article, you can get FDIC insurance and beat the return of most funds. Why earn 1.00% with no FDIC-insurance when you can easily earn 1.60% and have FDIC insurance.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Nick Clements
Nick Clements |

Nick Clements is a writer at MagnifyMoney. You can email Nick at nick@magnifymoney.com

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The Best CD Rates – November 2018

Any opinions, analyses, reviews or recommendations expressed in this articles are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by any lender or provider of the products listed.

The Best CD Rates
iStock

Updated November 9, 2018

If you are looking for a better yield on your savings, a high rate CD (certificate of deposit) offered by an online bank could be a good option. Internet-only banks offer much better interest rates than traditional banks. For example, a 12-month CD at Bank of America would require a $10,000 minimum deposit and would pay only 0.07%. At an online bank, you could earn 2.55% with no minimum deposit. (If you would rather get a savings account or money market with no time restriction, look at the best savings accounts or best money market accounts).

The Best CD Rates in November 2018

This list is updated monthly, and competition continues to intensify. Here are the accounts with some of the best CD rates:

Term

Institution

APY

Minimum Deposit Amount

 

1 year

PenFed Credit Union

2.71%

$1,000

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on PenFed Credit Union’s secure website

NCUA Insured

2 years

MainStreet Bank

3.25%

$25,000


on MainStreet Bank's secure website

3 years

Mountain America Credit Union

3.35%

$500

LEARN MORE Secured

on Mountain America Credit Union’s secure website

NCUA Insured

5 years

United States Senate Federal Credit Union

3.51%

$1,000

LEARN MORE Secured

on United States Senate Federal Credit Union’s secure website

NCUA Insured

See a full list of the best CD rates below.

  • 6 months – 7 years: PenFed Credit Union – 2.30% APY – 3.30% APY, $1,000 minimum deposit

12 Month Money Market Certificate from PenFed Credit UnionPenFed is a credit union that offers very competitive interest rates. You need to join the credit union in order to benefit from their products. If you have a military or government affiliation, it is free to join. Otherwise, you would need to join an organization like Voices for America’s Troops, which costs $17.00. Once you are a member, you can open PenFed products (including this certificate) online. Your deposit would be insured by the NCUA, which is the National Credit Union Administration. There is a $1,000 minimum deposit for the one-year certificate.

  • 6-months: 2.30%
  • 12-months: 2.71%
  • 15-months: 2.71%
  • 18-months: 2.75%
  • 2-years: 2.80%
  • 3-years: 2.85%
  • 4-years: 2.90%
  • 5-years: 3.30%
  • 7-years: 3.30%

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

  • 3 months – 5 years: Ally Bank – 0.75% APY – 3.10% APY; $0 minimum deposit (higher APY with higher deposit)

Ally Bank
Ally is one of the largest internet-only banks in the country. Ally’s former advertising campaign made it very clear: no branches = higher rates. And Ally has consistently paid some of the highest rates in the country across savings accounts, money market accounts and CDs. For savers with fewer funds, Ally is unique. There is no minimum deposit to open a CD. However, if you have more money, you can earn a higher APY. If you have more than $25,000 to deposit, you can earn between 0.75% APY and 3.10% APY. And one of our favorite features of Ally: they often (although not always) offer preferential rates on renewal. Far too often banks give the biggest bonuses to new customers, but Ally has done a good job of rewarding its existing customers. A good example of this is a 1% cash back promotion Ally is currently offering to new and existing customers. All deposits at Ally are FDIC insured up to the legal limit.

  • 3-months: 0.75% APY (less than $5k); 0.75% APY ($5k minimum deposit) and 0.75% APY ($25k minimum deposit)
  • 6-months: 1.00% APY (less than $5k); 1.00% APY ($5k minimum deposit) and 1.00% APY ($25k minimum deposit)
  • 9-months: 1.25% APY (less than $5k); 1.25% APY ($5k minimum deposit) and 1.25% APY ($25k minimum deposit)
  • 12-months: 2.65% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.65% APY ($25k minimum deposit)
  • 18-months: 2.50% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.70% APY ($25k minimum deposit)
  • 3-year: 2.60% APY (less than $5k); 2.70% APY ($5k minimum deposit) and 2.75% APY ($25k minimum deposit)
  • 5-year: 3.10% APY (less than $5k); 3.10% APY ($5k minimum deposit) and 3.10% APY ($25k minimum deposit)

LEARN MORE Secured

on Ally Bank’s secure website

Member FDIC

  • 6 months – 5 years: Capital One – 0.60% APY – 3.10% APY; no minimum deposit

12 Month 360 CD from Capital OneCapital One is famous for its credit card business. However, it has recently started getting aggressive with its CD rates. There is no minimum deposit for their 360 CDs, which make them comparable to Barclays’ CDs. Capital One CDs are FDIC insured, up to the federal maximum. And you get the comfort of depositing your money with a well-known bank.

  • 6-months: 0.60% APY
  • 9-months: 0.75% APY
  • 12-months: 2.60% APY
  • 18-months: 2.60% APY
  • 24-months: 2.70% APY
  • 30-months: 2.70% APY
  • 36-months: 2.80% APY
  • 48-months: 2.85% APY
  • 60-months: 3.10% APY

LEARN MORE 

Member FDIC

  • 6 months – 6 years: Goldman Sachs Bank USA – 0.60% APY – 3.15% APY; $500 minimum deposit

Goldman Sachs Bank USA
Our advertiser Marcus by Goldman Sachs is the online consumer bank of Goldman Sachs Bank USA (the large investment bank). Your funds are FDIC insured, and Goldman offers very competitive rates. Even better: there is only a $500 minimum deposit. So, if you don’t have enough money to meet the minimum deposit of the other banks on this list, or you are looking for another bank for your savings, GS is a good option. It also doesn’t hurt that they also offer some of the best CD rates in the market today. Here are their rates:

  • 6-month: 0.60% APY
  • 9-month: 0.70% APY
  • 12-month: 2.55% APY
  • 18-month: 2.55% APY
  • 2-year: 2.60% APY
  • 3-year: 2.65% APY
  • 5-year: 3.10% APY
  • 6-year: 3.15% APY

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

  • 1 year – 5 years: Barclays Bank – 2.55% – 3.10% APY, no minimum deposit

12 Month Online CD from Barclays Barclays is one of the oldest banks in the world. Although they’re based in London, they do have a U.S. presence and offer competitive rates on their CDs and savings account. Currently, they’re offering some of the highest CD rates in the market, and they have an edge over the rest of the institutions on this list: they don’t require a minimum balance to earn the APY or open an account. Deposit as little or as much as you’d like into a term of your choice and you can start earning interest as long as the account is funded within 14 days of opening the CD. Additionally, your funds are insured through the FDIC.

  • 1-year: 2.55% APY
  • 2-year: 2.60% APY
  • 3-year: 2.65% APY
  • 4-year: 2.75% APY
  • 5-year: 3.10% APY

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

  • 3 months – 5 years: Synchrony Bank – 0.75% APY – 3.10% APY; $2,000 minimum deposit

Synchrony Bank
Synchrony used to be a part of GE, and now has an online bank that pays competitive rates. The online deposits are used to fund their store credit card portfolio – and the company is publicly traded. Your deposit will be insured up to the FDIC limit. In a rising rate environment, this is a great way to get a high interest rate without locking yourself into a long term.

  • 3-months: 0.75% APY
  • 6-months: 1.00% APY
  • 9-months: 1.25% APY
  • 12-months: 2.50% APY
  • 15-months: 2.75% APY
  • 18-months: 2.75% APY
  • 24-months: 2.75% APY
  • 36-months: 2.85% APY
  • 48-months: 2.95% APY
  • 60-months: 3.10% APY

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

  • 2-Year CD: MainStreet Bank – 3.25% APY, $25,000 minimum deposit

MainStreet Bank was established in 2005 with the hopes of creating “enduring bank relationships” with its customers. Since 2005, the bank has acquired over $251 million in assets. Currently, MainStreet Bank is offering a 24-month CD with a 3.25% APY. This CD is actually unique because it comes with a savings account. MainStreet Bank has coined this account as a Companion CD & Savings Account. There are a couple nuances with this account, so make sure you read the fine print and speak to the bank if you have any questions. One unfortunate feature of this account is that there is a steep minimum deposit amount of $25,000. Fortunately, your deposit is FDIC-insured.

on MainStreet Bank’s secure website

  • 2-Year CD from a Credit Union: Connexus Credit Union – 3.20% APY, $5,000 minimum deposit

60 Month Certificate from Connexus Credit UnionIf you’re able to deposit $5,000 into a CD, you’ll want to consider this 2-year CD with an incredible 3.20% APY. Anyone is able to join the credit union by making a donation of $5 to their organization called Connexus Association. This organization provides scholarships and assists educational institutions. They have a mobile banking app as well as an online banking platform.

LEARN MORE Secured

on Connexus Credit Union’s secure website

NCUA Insured

  • 3-Year CD from a Credit Union: Mountain America Credit Union, 3.35% APY, $500 minimum deposit

3 Year Term Deposit from Mountain America Credit UnionMountain America Credit Union was established in the 1930s to help its members achieve their financial goals. Today, they have grown to serve hundreds of thousands of members and have acquired over $7 billion in assets. This credit union is open to Utah residents in certain areas, family members of existing members of the credit union, and employees and volunteers of a Select Employer Group. If you are a member or become a member of the American Consumer Council, you’ll qualify for membership at Mountain America Credit Union. Once you become a member, you’ll be able to open a CD. You’ll need to deposit a minimum of $500 in order to earn their outstanding 3.35% APY. Accounts can be managed online or through their mobile app. Deposits made to Mountain America Credit Union are insured by the NCUA.

LEARN MORE Secured

on Mountain America Credit Union’s secure website

NCUA Insured

  • 3-Year CD: KS StateBank – 3.22% APY, $500 minimum deposit

3 Year CD from KS StateBankKS StateBank is mainly a brick-and-mortar institution located in Kansas and Phoenix, Arizona. However, they also offer online services to reach those not in their area. Sometimes, they even offer special rates to their online customers. While this 3-year CD is not an online special, it is a term that can be opened online rather than at a branch. With a minimum deposit amount of $500, you can begin earning an APY of 3.22%. KS StateBank not only offers online banking, they also have a mobile banking app. Deposits made to this bank are FDIC-insured.

LEARN MORE Secured

on KS StateBank’s secure website

Member FDIC

  • 5-Year CD from a Credit Union: United States Senate Federal Credit Union – 3.51% APY, $1,000 minimum deposit

United States Senate Federal Credit Union

Despite what the name may suggest, you do not have to be a Senate employee to join the United States Senate Federal Credit Union. If you don’t meet the work or family qualifications, you can easily become a member by joining the American Consumer Council, Virginia Chapter (VACC) or by joining the U.S. Capitol Historical Society (USCHS). This credit union was established by nine employees of the United States Senate during the Great Depression. Since then, the credit union has grown to have over $717 million in assets.

Currently, the United States Senate Federal Credit Union is offering amazing rates on its 5-year CD. With a minimum deposit of $1,000, you can earn an APY of 3.51%. If you deposit more, the APY increases. The other tiers are as follows:

  • $20,000-$59,999.99: 3.57% APY
  • $60,000-$99,999.99: 3.63% APY

LEARN MORE Secured

on United States Senate Federal Credit Union’s secure website

NCUA Insured

  • 5-Year CD: KS StateBank – 3.49% APY, $500 minimum deposit

5 Year CD from KS StateBankOnce again KS StateBank lands a top spot on our list. Its 5-year CD has an APY of 3.49%, which is one of the highest currently available. You’ll only need $500 to deposit to open the account.

LEARN MORE Secured

on KS StateBank’s secure website

Member FDIC

3 Questions To Ask Before You Open A CD

1. Should I just open an online savings account instead?

With a CD, the saver and the bank make stronger commitments. The saver promises to keep the funds in the account for a specified period of time. In exchange, the bank guarantees the interest rate during the term of the CD. The longer the term, the higher the interest rate – and the higher the penalty for closing the CD early. With a savings account, there are few promises. You can empty the account without paying a penalty and the bank can change the interest rate at any time.

If you have a high level of confidence that you do not need to touch the money for a specified period of time, a CD is a much better deal. However, if you think you might need to use the money in the next couple of months, a savings account is a much better idea.

You can earn a lot more interest with a CD. Imagine you have $10,000 and know that you do not need to touch the money for two years. In a high-yield savings account earning 1.60%, you would earn $322.56 over two years. If you put that money into a 2.50% CD, you would earn $508.30. Given the ease of switching to an online CD, the extra interest income is easy money.

2. What term should I select?

The early withdrawal penalties on CDs can be significant. On a 1-year CD, 90 days is a typical penalty. And on 2 and 3 year CDs, a 6-month penalty is common. The impact of the penalty on your return can be significant. If you opened a one-year CD with a 2.20% APY and closed it after six months, you would forfeit half of the interest and earned only 1.11%. You would have been better off with a savings account paying 2.05%.

The worst case scenario is with the longest CDs. 5-year CDs usually have a one-year penalty for taking out funds early. If you open a 5-year CD and close it quickly, you could actually end up losing money.

Given the early penalties, you need complete confidence that you will not need to withdrawal the money early. Ask yourself this question: “do I have 90% confidence that I will not need access to the cash during the CD term?” If you don’t have confidence, go for a shorter term or a savings account.

3. Should I consider my local bank or credit union?

The interest rates shown in this article are all from online banks that offer products nationally. Our product database includes traditional banks, community banks and credit unions. If traditional banks offered better rates, they would have been featured in this article. The internet-only banks have dramatically better interest rates. That should not be surprising. Because internet-only banks do not have branches, they are able to pass along their cost savings to you in the form of higher interest rates.

However, you can always visit your local bank or credit union and ask them to beat the rates listed in this article. The chance of getting a better deal is extremely low (remember that Bank of America is only paying 0.07%), but you can try.

How To Find The Best Account

If you don’t find an account that meets your needs in this article, you can use the MagnifyMoney CD tool to find the best rate for your individual needs. Input your zip code, deposit amount and term. The tool will then provide you with CD options, from the highest APY to the lowest.

You can learn more about us and how we make money here.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Nick Clements
Nick Clements |

Nick Clements is a writer at MagnifyMoney. You can email Nick at nick@magnifymoney.com

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Earning Interest

Review of USAA CD Rates

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

USAA CD rates
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Founded and based in San Antonio, USAA is an FDIC-insured bank, insurance and financial services company that serves current and former military members and their families. Started by 25 U.S. Army officers, USAA has since grown to more than 11 million members. Most of their products are only available to USAA members, who are military members or their families.

USAA won a number of awards in 2016, including the title World’s Most Ethical Company from the Ethisphere Institute. It scored top rankings in the bank, insurance, and credit card categories in the Temkin Customer Service Ratings from 2013 to 2016.

Looking beyond high customer service standards, USAA CD rates are pretty comparable to the national average, though with some products they are significantly lower. Minimum deposit requirements are lower than with many similar products, though there are CDs out there with better rates and lower minimum deposits than USAA’s CDs. If you’re a member of the military (or a family member of military member) and looking for a bank that offers a wide variety of products as well as excellent customer service, USAA could be a good bet if you’re will to make the tradeoff for lower CD rates.

*All rates are current as of 11/9/2018

USAA Fixed-Rate CDs

A USAA fixed-rate CD is for those who intend to make one deposit to get a guaranteed rate of return over the agreed-upon term. Once you make your initial deposit (which differs depending on the type of CD you choose), your interest rate is set for the duration of the CD term. You are not allowed to make any additional deposits into your CD account after the initial amount.

Interest accumulates daily, and you have the choice to keep any interest earned in the CD until it matures (the interest will compound monthly) or have it paid out monthly to an account of your choosing. The CD will not be renewed automatically once it matures, though you have the option to do so if you want. If not, all the money in the account will be paid into an investment account until you withdraw it or invest it in another type of account.

Early-withdrawal penalties apply depending on the term of your CD:

  • Terms of 30 days or less: 30 days’ worth of interest
  • 30 days to 364 days: 90 days’ interest
  • 365 days to five years: 180 days’ interest
  • Five years or more: 365 days’ interest

Also, if you make a withdrawal within six calendar days of a deposit or another withdrawal, you’ll have to pay at least seven days’ worth of interest.

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on USAA Bank’s secure website

Member FDIC

Standard rates

A standard CD requires a minimum deposit of $1,000 and up to a maximum of $95,000. This type of account is best for those who do not have a large amount of money to invest and want a guaranteed rate for their savings.

CD Term

APY

91 days

0.30%

182 days

0.56%

7 months

0.56%

270 days

0.66%

1 year

1.88%

15 months

1.88%

18 months

1.97%

2 years

2.17%

30 months

2.27%

3 years

2.38%

4 years

2.48%

5 years

2.68%

7 years

2.78%

USAA fixed jumbo CD rates

Fixed jumbo CDs require a minimum deposit of $95,000 and a maximum amount up to $175,000.

CD Term

APY

30 days

0.22%

91 days

0.35%

120 days

0.45%

150 days

0.50%

182 days

0.61%

7 months

0.61%

270 days

0.71%

1 year

2.03%

15 months

2.03%

18 months

2.12%

2 years

2.32%

30 months

1.59%

3 years

2.53%

4 years

2.63%

5 years

2.84%

7 years

2.94%

USAA fixed super jumbo CD rates

Fixed super jumbo CDs require a minimum deposit of at least $175,000 with no maximum amount. However, FDIC only insures up to $250,000.

CD Term

APY

30 days

0.22%

91 days

0.35%

120 days

0.45%

150 days

0.50%

182 days

0.61%

7 months

0.61%

270 days

0.71%

1 year

2.23%

15 months

2.23%

18 months

2.32%

2 years

2.53%

30 months

1.59%

3 years

2.73%

4 years

2.84%

5 years

3.04%

7 years

3.14%

USAA Adjustable-Rate CDs

Like the fixed-rate CDs, the interest rate is locked for the entirety of the agreed term with an adjustable-rate CD. All interest is compounded daily starting on your settlement date (the actual date when your deposit goes into your account) and the interest either paid out monthly or kept in the account until your CD matures. Your CD will not be automatically renewed. Instead the money will be put into an investment account until you decide to put it back into another CD account or withdraw the entire balance.

Unlike with the fixed-rate CD, however, you can adjust your rate once during your CD term as well as make one other deposit when you request a rate adjustment. If rates go up, you can make an adjustment up to a 2 percent increase. The additional deposit needs to be a minimum of $25.

Early-withdrawal penalties are the same as with the fixed-rate CD:

  • Terms of 30 days or less: 30 days’ worth of interest
  • 30 days to 364 days: 90 days’ interest
  • 365 days to five years: 180 days’ interest
  • Five years or more: 365 days’ interest

In addition, you will be required to pay at least seven days’ worth of interest if you withdrawal money within six calendar days of either a deposit or another withdrawal from your account.

Standard rates

The minimum opening deposit for an adjustable standard CD account is $1,000. You’re allowed up to a maximum of $95,000. Otherwise, you will need to open an adjustable jumbo CD account.

CD Term

APY

3 years

0.91%

4 years

1.22%

5 years

1.49%

7 years

1.54%

Jumbo rates

Adjustable Jumbo CDs need a $95,000 minimum deposit and rates are applicable up to $175,000.

CD Term

APY

3 years

0.96%

4 years

1.27%

5 years

1.54%

7 years

1.59%

Super jumbo rates

Adjustable super jumbo CDs have a minimum deposit of $175,000 with no limits on how much you can keep in your account. Keep in mind that FDIC insures up to $250,000 in your account.

CD Term

APY

3 years

0.96%

4 years

1.27%

5 years

1.54%

7 years

1.59%

As of 8/6/2018

USAA variable-rate CDs

This type of CD account is best suited to those who want the ability to make more than one deposit any time they choose. The rate tends to be lower than the other CDs of the same term length, but you are allowed to make as many additional deposits as you like without extending the maturity date, as long it’s $25 or more each time. This could help you earn more on your deposits than you would with a traditional savings account, though there are better rates to be had among those products, as well.

Unlike the fixed- and adjustable-rate CDs, the interest rate on a variable-rate CD may fluctuate daily so earnings may be affected. However, interest is compounded daily and just like the other CD accounts and you can either keep earned interest with the CD balance and allow the interest to compound, or you can have it paid out to another account every month.

There are also early-withdrawal penalties with a variable rate CD. You’ll be charged 30 days’ worth of interest if you take your money out before the maturity date.

CD Term

APY

Minimum Deposit Amount

182 days

0.46%

$250

1 year

0.46%

$250

Overall review on USAA’s CD rates

Above all, it’s important to remember that only USAA members can get its products, so if you’re not eligible for membership, USAA CDs aren’t an option for you.USAA’s CD rates are not as competitive as other institutions’ products (you can see the best CD rates in our monthly roundup). While the $1,000 minimum deposit requirement is lower than some other banks that offer higher APYs on their CDs, you can get a better CD rate on accounts with deposit requirements as low as $500. While the rates for jumbo and super jumbo CDs are better than its standard offers, you can find better rates.

One of the main advantages of opening a CD with USAA is the ability to bump up your rate with an adjustable-rate CD, as other banks don’t always offer this option.. It’s important to note that a rate increase is not guaranteed. However, you are given an opportunity to make another deposit into your account before maturity.

As for USAA’s variable-rate CD, you may be better off opening a high-interest savings account if you’re looking for an account with a good APY and some liquidity.

Overall, if you want a bank with excellent customer service and the ability to choose from a wide variety of services, USAA is a good option. USAA may be your best choice if you want your CDs at a bank that understands needs specific to military members and their families. But if high yields are your priority, you’re better off looking elsewhere.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Sarah Li Cain
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Earning Interest

Money Market Account vs. Savings Account: What’s the Difference?

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

money market vs. savings account
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Money market and savings accounts can be good options when you want to deposit your money and keep it in a safe place. If you’re wondering which option is better for your savings, we’ll explain in this post.

First, why save your cash in a savings or money market account at all? Your short-term savings needs a safe place to stay and possibly grow without too much risk. You also want to have it in a place that allows you to withdraw it if or when it’s needed. That’s where a deposit account can come in handy. Not only can you deposit money into the account, but you can also withdraw the funds if a financial emergency comes up.

You can set up a deposit account with your local bank, an online bank or a credit union. Two popular examples of deposit accounts are savings accounts and money market accounts, also known as demand deposits.

With demand deposits, you can withdraw the funds you need (sometimes even the full amount) without needing permission from your bank. Money market and savings accounts can also earn interest so that your funds can grow over time. Often, these two accounts can provide a higher annual percentage yield (APY) than other demand deposits, including a checking account.

Deposit accounts can also be categorized as time deposits. Both certificates of deposit (CDs) and IRA CDs can be grouped into this category. Like money market and savings accounts, these accounts can accumulate interest, but there can be fees tacked on if you withdraw your money early.

Money market vs. savings: 2 key similarities

1. Both carry an interest rate

Whether you open a savings or money market account, you have the potential to earn interest on the money you deposit. Interest rates with both can fluctuate, and while money markets have been known to have higher rates in the past, that’s not always the case today.

There are times when money markets and savings accounts can have similar interest rates. Separately, the interest rates with savings and money market accounts can be lower than with other forms of deposit accounts, including CDs.

2. Both limit withdrawals

Money market and savings accounts can come with some restrictions. You may not have full access to your money since there are limit withdrawals to consider. Due to Federal Reserve Board Regulation D, there may be limitations when withdrawing or transferring your funds, including being allowed up to six transactions every month.

If you fail to meet these requirements or exceed your monthly limit, you can be subject to withdrawal fees or your account being terminated. It’s always important to check with your bank or credit union to learn about its specific terms and potential fees so that you know what to expect.

Money market vs. savings: 2 key differences

While there are some similarities between money market and savings accounts, there are also a few differences of which to be aware. Sure, they allow you to deposit your money and withdraw it if needed, but there are rates and deposit requirements to consider.

Here are some of the main differences between the two accounts that you should keep in mind.

1. Money market accounts typically have higher rates

While the rates with money market and savings accounts can sometimes average out to be the same, money markets can still often offer higher rates. That is usually because money market accounts can require larger deposit amounts.

You can see the difference when you compare rates with savings accounts from brick-and-mortar banks, which can average 0.01% APY. But when you compare online banks, the interest rates for savings and money market accounts are very similar. For example, Marcus by Goldman Sachs offers 2.05% APY with its online savings account, which is just above the 2.00% APY offered by Capital One’s 360 Money Market account for balances greater than $10,000.

But when you look at VirtualBank, an online banking institution, you’ll find it offers a fixed rate for its eMoney Market account. With it, Virtual Bank offers a 0.80% APY for the first year.

2. Savings accounts have lower minimum opening deposit requirements

When you open a savings account or money market, you will most likely need to deposit a minimum amount of money. Each bank and credit union has requirements, but savings accounts usually have a lower minimum than with most money markets. And some savings accounts don’t even require you to deposit a certain amount of money when you open an account.

For example, MySavingsDirect doesn’t require a minimum deposit amount to put your money into one of its savings accounts. But MutualOne Bank requires at least $100 to be deposited for a savings account, while Citizens Access requires $5,000.

Money markets usually require a minimum deposit that can range from institution to institution, but they can often be higher than with a savings account. Also, to get the best rate with a money market account, you’ll usually need to have a certain amount of money in your account. As you may remember, Capital One 360 Money Market provides a high rate of 0.85% APY. While it doesn’t require a minimum deposit when you open the account, you will not get the0.85% APY until you have at least $10,000 in your account. Anything below that will receive 0.85% APY.

Which account is best for you? 4 factors to consider

Both money market and savings accounts have pros and cons to take into consideration before you make a decision. It can seem hard to decipher the right choice for you, which is why researching both is a smart idea. When trying to decide between these two accounts, here are a few important factors to think about:

  1. You have a high opening deposit: Many money market accounts ask for a high opening deposit. In return, they can offer higher rates. This might be a good option for you if you have the funds to make a larger deposit and want to earn more interest.
  2. You’re just starting out: If you don’t have a lot of money to put into a money market account that asks for a high deposit, you may want to consider a savings account. Shop around to find one that doesn’t offer a minimum deposit requirement (or a low amount), and offers a sizable APY so that you can start earning interest as you save.
  3. You want the option to write checks: If you need a lump sum of money and aren’t near an ATM or your bank to withdraw funds, you might want to write a check. Having the option to write out a check from your money market account might be ideal when unexpected financial emergencies arise. Just remember: You may come across some restrictions due to Reg D, such as only having a limited amount of checks you can write in a given time frame.
  4. You want to earn higher interest: While the interest rates can sometimes be close to the same, money markets can still possibly provide higher rates. If you want to maximize your interest earnings, it’s best to shop around to find a money market account that provides you with a higher rate. But keep in mind that you may need to put down a larger deposit or keep a specific amount of money in your account to receive these rates.

Where to find a money market or savings account

Now that you’ve learned the differences between a money market and savings account, you may be interested in finding one to deposit your money to keep it safe. Searching online for these types of deposit accounts is fast and easy, providing you with results in a few minutes.

Finding a money market or savings account doesn’t have to be a complex task. MagnifyMoney has its own savings account marketplace, which can help get you started. Begin by adding your ZIP code, the amount of money you want to put into your account and the length of time you want to keep your money in that particular account. Once you provide your personal information, you can then see results from various banks (online and brick and mortar) and credit unions. You’ll be able to compare the minimum deposit amount and APY to find the best option for you.

Money market and savings accounts are both solid choices for when you want to open a deposit account to put your money away. But there are some pros and cons of both accounts to take into consideration. It’s essential to do plenty of homework on both to see which works best for your financial needs. Once you decide which account you want to open, take your time to shop around for the best rates and inquire about all fees.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Carissa Chesanek
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Carissa Chesanek is a writer at MagnifyMoney. You can email Carissa here

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Best of, Earning Interest

The Best IRA CD Rates – November 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Top IRA CD rates
Source: iStock

Perhaps you’ve decided to build a CD ladder within your IRA, or maybe you’re looking for a safe way to store your retirement cash for a specific period of time. Whatever the reason, you’re interested in getting an IRA CD and, understandably, want to know what products will give you the best rate of return.

You can get an IRA CD with terms ranging from three months to more than six years, with interest rates generally increasing with the term length. There are lots of options, so we’ve rounded up the top IRA CD rates that are available right now for a variety of terms. You’ll select your IRA CD terms based on your CD-ladder master plan or whenever you’ll need access to your money.

Every month, we choose the best IRA CD rates using data from another LendingTree company DepositAccounts.com, a database of offerings at more than 17,100 banks and credit unions. On November 5, 2018, we sorted the products by APY, then eliminated institutions with a health rating below a B. We then eliminated products that are not available nationwide. From there, we chose the IRA CD with the highest APY among products with a minimum deposit no greater than $5,000. Here are the best options. (Average CD rates referenced below are based on DepositAccounts.com data as of November 5, 2018.)

The best IRA rates in November 2018

Term

Institution

APY

Minimum Deposit Amount

3 months

TIAA Direct

1.90%

$5,000

6 months

CommunityWide Federal Credit Union

2.30%

$2,000

12 months

State Department Federal Credit Union

2.68%

$500

18 months

American Heritage Federal Credit Union

2.80%

$1,000

2 years

Communitywide Federal Credit Union

2.90%

$2,000

3 years

Mountain America Credit Union

3.35%

$500

4 years

Mountain America Credit Union

3.25%

$500

5 years

Mountain America Federal Credit Union

3.51%

$500

 

3 Month IRA CD – TIAA Bank, 3 Month Yield Pledge IRA (Traditional, Roth)

TIAA Bank
Three-month regular CDs are earning an average interest rate of 0.42% APY currently. TIAA Bank is exceeding that, with an interest rate of 1.90% APY with their 3-Month Yield Pledge IRA CD. With that APY and a $5,000 minimum deposit, you would earn $23.58 when the certificate matures.

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on TIAA Bank’s secure website

Member FDIC

6-Month IRA CD – CommunityWide Credit Union, 6 Month IRA (Traditional, Roth)

Communitywide Federal Credit Union

Six-month IRA CDs typically earn a little bit better, but they’re normally still not great. CommunityWide Federal Credit Union, however, is breaking that norm by offering the highest interest rate at 2.30% APY for deposits of $2,000 and over. That translates into earnings of $22.87 if you were only to deposit the minimum amount. Compare that to the average of all regular 6 month CDs, at 0.73%.

LEARN MORE Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

1-Year IRA CD Rates – State Department Federal Credit Union, 12 Month IRA Certificate (Traditional, Roth)

12 Month IRA Certificate from State Department Federal Credit UnionRegular one-year CDs earn an average interest rate of 1.09% APY. State Department Federal Credit Union, however, is offering a one-year IRA CD at 2.68% APY. You’ll need a $50 minimum deposit to earn interest once you’ve been approved for membership.

LEARN MORE Secured

on State Department Federal Credit Union’s secure website

NCUA Insured

18-Month IRA CD Rates – American Heritage Federal Credit Union, 18 Month IRA Certificate (Traditional, Roth, CESA)

18-month regular CDs earn an average interest rate of 1.41% APY. American Heritage Federal Credit Union on the other hand, is currently offering 2.80 APY on an 18-month IRA CD. You’ll need a minimum deposit of $1,000 to open the account.


on American Heritage Federal Credit Union’s secure website

2-Year IRA CD Rates – CommunityWide Federal Credit Union, 24 Month IRA (Traditional, Roth)

60 Month IRA from Communitywide Federal Credit UnionTwo-year regular CDs earn an average interest rate of 1.44% APY. CommunityWide Federal Credit Union, on the other hand, is currently offering 2.90% APY on a 2-year IRA CD. This would translate into earnings of $117.68 with a minimum $2,000 deposit.

LEARN MORE Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

3-Year IRA CD Rates – Mountain America Credit Union, 3 Year IRA (Traditional, Roth)

3 Year Term Deposit Plus from Mountain America Credit UnionThree-year regular CDs are earning an average interest rate of 1.69% APY currently. Mountain America Credit Union is exceeding that, with an interest rate of 3.35% APY with their 3-year IRA CD. You’ll need a minimum deposit amount of $500 to open this account.


on Mountain America Federal Credit Union’s website

4-Year IRA CD Rates – Mountain America Federal Credit Union, 4 Year IRA (Traditional, Roth)

4 Year Term Deposit from Mountain America Credit UnionFour-year regular CDs are currently earning an average interest rate of 1.83% APY. Mountain America Federal Credit Union claims the top interest rate for these IRA CDs, with an interest rate of 3.25% APY. It’s interesting enough to note that Mountain America FCU’s 3-year IRA has a higher rate. You need a $500 minimum deposit to open the account.


on Mountain America Federal Credit Union’s website

5-Year IRA CD Rates – Mountain America Credit Union, 5 Year IRA

MACU-5 Year IRA CD Rates Five-year IRA CDs hold the top spot for interest rates out of any category on our list. National averages for a regular 5-year CD is 2.11% APY, however Mountain America Credit Union outperforms the average with a 3.51% APY on its 5-year IRA CD for members. The minimum deposit is $500.

on Mountain America Federal Credit Union’s website

6+ Year IRA CD Rates – Air Force Federal Credit Union, 7 Year IRA (Traditional, Roth, CESA)

AFFCU

We’re starting to see these very-long-term IRA CDs offer higher interest rates than the shorter-term five-year IRA CDs. Air Force Federal Credit Union offers the highest term for their seven-year IRA CD, at 3.20% APY. That’s less than Mountain America Federal Credit Union which offers a 3.51% APY for a five-year IRA CD. Still, with Air Force Federal Credit Union’s seven-year IRA CD, you would earn $616.72 on a minimum deposit of $2,500 when the IRA CD matures.

LEARN MORE Secured

on AFFCU’s secure website

NCUA Insured

3 questions to consider before opening an IRA CD

Opening an IRA CD generally requires filling out a form or talking to a banker. You’ll have to have a way to fund your IRA CD, whether that’s rolling over an existing retirement account into an IRA CD or depositing cash into the product. The same limits that apply to IRA contributions apply to IRA CDs: $5,500 per year ($6,500 if you’re over age 50) of your own money across all your IRA accounts each year, and you can do a rollover once per year.

Unless you’ve invested in a bump-up IRA CD, you won’t be able to take advantage of a higher rate until your CD matures. Withdrawing funds from an IRA CD before they mature will result in a stiff penalty. Bump-up IRA CDs give you a chance to increase your interest rate to a higher level if it’s available, but you’re generally only allowed to do this once or twice during the life of the CD.

You can either use the direct-transfer method or the indirect-transfer method. The direct transfer method requires setting up your new IRA account filling out a form authorizing the bank or credit union to transfer money from the old account into the new account. The indirect transfer method involves you asking for a check from your old IRA account. You have up to 60 days to deposit that check into your IRA CD to avoid incurring a penalty.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lindsay VanSomeren
Lindsay VanSomeren |

Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here

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Earning Interest

Top Jumbo CD Rates for November 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Jumbo CD rates
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In the banking world, CD stands for certificate of deposit. This is a type of savings account where you agree to put a certain amount of money in for a set period of time. In return, the bank agrees to pay you interest. You may have to pay early-withdrawal penalties if you access your money before the CD term ends.

There is a type of CD called a jumbo CD, in which you generally have to put in a minimum deposit of $100,000. Sometimes these jumbo CDs have higher interest rates than CDs where you deposit less than $100,000.

Best CD Rate Currently Available: Barclays Bank – 12-Month CD – 2.55% APY

Barclays Bank is currently offering one of the highest CD rates available on a 1-year CD. While this CD is technically not a jumbo CD, it offers a rate that is too good to pass up at a lower minimum deposit than a jumbo CD. You can earn the 2.55% APY with any amount as this account doesn’t have a minimum balance. This high rate will be locked in for the duration of the term once the account is funded.

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

Your deposit is FDIC-insured up to the maximum limit.

The top jumbo CD rates

To compile a list of the top jumbo CD rates, we used information from DepositAccounts.com, which, like MagnifyMoney, is a LendingTree company. We sorted products by APY. Then, we excluded any institutions with a health rating below a B, as well as any credit unions with very restrictive membership requirements. If there was a tie between APYs, we chose the CD with a minimum deposit of $100,000. All products on this list are insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA), but with jumbo CDs, it’s especially important to remember that only deposits up to $250,000 are insured.

Keep in mind that other banks might offer a CD with a better APY and a lower minimum deposit than $100,000. However, the chart below reflects the true definition of a jumbo CD, which involves a deposit of $100,000 or more.

This table is updated as of November 5, 2018, but it’s always a good idea to double-check the annual percentage yield (APY) before making your choice of where to invest. Some banks on the list offer promotional APYs, so be sure to check that the rates below are still available since rates can change day to day.

Institution

CD Term

APY

Minimum Deposit Amount

M.Y. Safra

3 months

1.25%

$100,000

My eBanc

6 months

2.25%

$100,000

My eBanc

1 year

2.70%

$100,000

Veridian Credit Union

18 months

3.05%

$100,000

KS StateBank

2 years

3.10%

$100,000

KS StateBank

3 years

3.22%

$100,000

Veridian Credit Union

4 years

3.45%

$100,000

KS StateBank

5 years

3.49%

$100,000

As of November 5, 2018

Banks that offer the best jumbo CD rates

M.Y. Safra Bank

M.Y. Safra Bank
M.Y. Safra Bank holds three spots on this list. When you go to its homepage, you’ll notice the banner shows “Special CD Offers.” This means that it’s important to keep track of these interest rates to make sure you get one that is current. This page has asterisks next to online promotions, so you know which ones might not be offered for a long time.

One downside to M.Y. Safra Bank is that the website is hard to navigate and is slow to load. This could be difficult for sophisticated investors who are used to banking with ease.

For a three-month jumbo CD, the APY is 1.25%. Currently, M.Y. Safra Bank is offering a 3 Month Online Promo CD with a better rate at 1.61%, but it wasn’t factored into this chart since this category is specifically for jumbo CD offerings.

LEARN MORE  Secured

on M.Y. Safra Bank’s secure website

My eBanc

My eBanc
My eBanc is an online-only bank. It’s a division of BAC Florida Bank. Unlike M.Y. Safra Bank’s, the eBanc website is much easier to navigate and has clear instructions on how to open a jumbo CD.

According to the site, My eBanc has no maintenance fees and compounds interest daily. When your jumbo CD matures, withdrawing your money is simple, although there is an early-withdrawal fee.

For a six-month jumbo CD, their APY is 2.25%. Their one-year CD currently has an APY of 2.70%.

LEARN MORE Secured

on My eBanc’s secure website

Veridian Credit Union

Veridian Credit Union
Veridian Credit Union is headquartered in Waterloo, Iowa, has 30 locations and over 700 employees. You can become a member of the credit union if you live in the area or if you’re a registered user of Dwolla, an e-commerce company which is available to

You can see current rates on jumbo CDs on the Veridian rate sheet. Keep in mind that several of the rates listed are current specials and might not be available long term. At the time of this writing, Veridian Credit Union has a special on an 18-month jumbo CD with an APY of 3.05% and a 4-year jumbo CD with a 3.45% APY. This credit union also has various specials on 7, 9, and 15 month jumbo CDs.

LEARN MORE Secured

on Veridian Credit Union’s secure website

NCUA Insured

KS StateBank

KS StateBank

KS StateBank currently has internet-only specials on their 2, 3, and 5-year jumbo CDs. This bank has truly outstanding rates on all of their terms.

Although KS StateBank is mainly located in Kansas, they do have the option to bank online or through their mobile banking app. This allows them to reach customers nationwide.

LEARN MORE Secured

on KS StateBank’s secure website

Member FDIC

The difference between jumbo and regular CDs

As mentioned previously, you can open a CD with less than $100,000. You can even get CD rates comparable to the ones above, with a lower minimum deposit requirement. Of course, the more money you put in a CD, the more interest you can earn, but if you don’t have $100,000 to open a jumbo CD, it’s important to know you do have other options with lower minimums.

Withdrawal penalties on jumbo CDs

According to a recent survey, the penalties for withdrawing your money from your CD early could be serious. Some banks will even take part of your principal as a penalty.

Below are the most common penalties, according to the survey:

  • 3 month CD: Three months of interest
  • 6 month CD: Three months of interest
  • 1 year CD: Six months of interest
  • 2 year CD: Six months of interest
  • 5 year CD: A year’s worth of interest

So, it’s important to be confident that you want to put your money in a CD. When you do this, you’re making an agreement with the bank to leave it there for a set period of time. If you’re unsure if you want to tie up your money for a long period of time, consider a high-yield savings account instead.

How jumbo CDs are taxed

It’s important to know that the interest you earn on your jumbo CD will be taxed as interest income, not as capital gains income.

This means that your bank or credit union will send you a 1099-INT form at the end of the year to show how much interest you earned in your jumbo CD and you will be taxed on that.

Are jumbo CDs safe?

According to the U.S. Securities and Exchange Commission: “Certificates of deposit are considered to be one of the safest savings options. A CD bought through a federally insured bank is insured up to $250,000.”

Some people prefer investing in the stock market over CDs because you can often get higher rates of returns; however, the stock market is a riskier bet, and returns are not guaranteed like those associated with CDs.

CDs are not affected by the whims of the stock market. The interest rate you agree on with your bank is the rate you will get. That interest rate, however, may not outpace inflation, meaning you may not really earn much, if anything, over time.

Final thoughts

If you have over $100,000 and want to invest it in a jumbo CD, you have several options. Like the chart above shows, you can choose many different terms and durations for your jumbo CD. Just be sure to research the bank you invest with so you know you’re putting your money with a top-rated institution. Also, be sure that you’re comfortable with putting your money in a CD long-term because there are often penalties for withdrawing your money early.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Cat Alford
Cat Alford |

Cat Alford is a writer at MagnifyMoney. You can email Catherine at cat@magnifymoney.com

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Earning Interest, Reviews

Discover Bank CD Rates Review

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Discover Bank
Most people know Discover as a credit card company, but it also operates an online bank and offers some of the best rates and terms on checking and savings accounts and certificates of deposit (CDs).

If you’re looking for CDs in particular, Discover is currently considered one of the best CDs due to their customer service and digital tools.

Discover Bank CD rates

CD term

Annual Percentage Yield (APY)

3 months

0.35%

6 months

0.65%

9 months

0.70%

12 months

2.60%

18 months

2.60%

24 months

2.65%

30 months

2.65%

3 years

2.70%

4 years

2.75%

5 years

3.00%

7 years

3.05%

10 years

3.10%

LEARN MORE Secured

on Discover Bank’s secure website

How do Discover Bank CD rates compare?

While Discover Bank CD rates aren’t always the highest available, they are consistently among the top offers across all terms. However, you may be able to find a similar or even better rate with a CD that has a lower minimum deposit than Discover’s $2,500 requirement. Currently, several nationwide banks offered a 12-month CD at a rate higher than Discover’s 12-month CD APY, while requiring a lower minimum deposit. For example, at the same time the above rates were available at Discover, there were 12-month CDs with rates as high as 2.55% APY with a lower minimum balance amount to earn the APY.

It’s always great to go for the highest interest rates possible, but keep your CD investing strategy in mind. If you’re investing in CDs using the ladder strategy, it might be easier to keep everything in one bank since you’ll be switching in and out of CDs frequently.

Discover also stands out from its competition in the CD space with its mobile app and 24/7 U.S.-based customer service. If you value such features, keep those particulars in mind when weighing Discover CD rates against others’.

What you need to know about Discover Bank’s CDs

Discover Bank is very transparent in terms of fine print. It’s not difficult to understand what’ll happen with your money after you invest it. We’ll cover the basics here about what you need to know to invest in Discover Bank’s CDs.

How to open a CD

It’s very simple to open up a CD with Discover Bank. Go to their CD webpage and click on the orange “Open an Account” button near the top right of the page. You can then choose which accounts you’d like to open. Select “CD,” choose a CD term and enter how much you’d like to deposit.

You’ll then need to complete the application by providing your name, address, date of birth, phone number, Social Security number, employment status and possibly even your driver’s license. Once your application is complete and accepted, you’ll need to fund the account.

How to fund the CD

You’ll need to fund it within 45 days of submitting your application, which you can do in one of three ways:

  • Transfer funds from another bank account over the phone. (You can only do this when you first fund your account.)
  • Transfer funds from another bank via online transfer.
  • Write a check to yourself and send it to the following address:Discover Bank
    P.O. Box 30417
    Salt Lake City, UT 84130

The minimum deposit amount for each of Discover Bank’s CDs is $2,500. Once you open a CD, you can’t deposit more money later, so it’s a good idea to make sure you have all the cash you want to invest before you open the account.

Withdrawing funds from the CD

When you want to withdraw money from your CD, the biggest thing to consider is whether that CD has matured yet, or finished its term.

If your CD has not matured, you’ve got options: You can take the interest out penalty-free at any time, or you can withdraw the principal (or the money you deposited) at any time as long as you pay an early-withdrawal penalty. This penalty varies depending on the original term of your CD:

  • less than one year: three months’ worth of simple interest
  • one year to less than four years: six months’ worth of simple interest
  • four years: nine months’ worth of simple interest
  • five years to less than seven years: 18 months’ worth of simple interest
  • seven years or longer: 24 months’ worth of simple interest

If your CD has finished its term, you can withdraw your money penalty-free, allow the CD to renew or roll it into a CD of a different term length. (More on that in a bit).

Earning interest on a Discover CD

Your CD will start earning interest on the same business day that you fund the account. The interest will be added to your account once each month, however.

When it comes to what to do with your interest, you have two options: The default option is to allow it to compound within the CD (meaning you’ll earn interest on that interest), or you can have it automatically deposited each month into another Discover bank account.

What happens once the CD matures?

You’ll get a heads-up notice about a month before your CD matures so you can decide what to do with the money. You have two main options: Either reinvest it into another CD (of the same term length or a different term length), or withdraw the money from the CD and put it into another account (such as a checking or savings account, or perhaps a CD at a different institution).

If you don’t let Discover know what you want to do with the maturing CD, the CD will automatically renew into another one of the same term length. You have a nine-day grace period after your CD automatically rolls over to make any changes or withdrawals penalty-free.

The bottom line

As far as big-name banks go, Discover offers great CD products. Wells Fargo, for example, only offers interest rates as high as 1.55% APY on a $5,000 deposit for a 58-month CD. Chase Bank offers even lower maximum rates — an abysmal 1.05% APY, and only if you can commit a minimum of $100,000 for 10 years.

If you’re the kind of person who likes to keep your finances in one place, Discover also has great credit cards, as well as competitive online savings and checking accounts. No matter how long you’re considering putting money in a CD, Discover is worth a look. Even if it doesn’t have the best available rate, it’s usually within several basis points of the top offerings and well above the average APY.

LEARN MORE Secured

on Discover Bank’s secure website

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lindsay VanSomeren
Lindsay VanSomeren |

Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here

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Earning Interest, Reviews, Strategies to Save

Review of Live Oak Bank’s Deposit Rates

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Year Established2008
Total Assets$3.4B

LEARN MORE on Live Oak Bank’s secure websiteMember FDIC

Chances are you haven’t heard of Live Oak Bank. After all, this lender, based mostly on the web, has only been around since 2008, and it mostly focuses on giving out small business loans to businesses in specific industries, such as veterinary practices or craft breweries. That’s no reason to pass it up for your personal banking needs, however. In fact, this little gem of a bank has one of the best-kept secrets in the personal banking world: it has one of the highest savings account interest rates you’ll find from an online bank. (More on that below.) And, most of its other personal deposit accounts offer relatively high rates as well. Let’s take a more in-depth look at its deposit accounts to see if they’re right for you.
Live Oak Bank’s Most Popular Accounts

APY

Account Type

Account Name

1.10%

Savings

Live Oak Bank Business Savings

LEARN MORE Secured

on Live Oak Bank’s secure website

Member FDIC

Live Oak Bank’s savings account

When it comes to the best savings accounts with high interest rates, Live Oak Bank currently has one of the highest rates.

APY

Minimum Deposit

2.00%

Up to $5 million

(but only up to $250,000 is FDIC-insured)

  • Minimum opening deposit: $0
  • Monthly account maintenance fee: $0
  • ATM fees: None
  • ATM fee refunds: None

Live Oak Bank currently has one of the best savings account rates available. This means that Live Oak Bank is lowering the bar and allowing anyone to take advantage of these high interest rates, no matter how much is in his or her pocket right now.

Live Oak Bank wants you to use your savings account, and use it often, which is one reason why it has no monthly maintenance fee. If there is no activity on your account for 24 months and your balance is less than $10.01, Live Oak Bank will take the remainder of your balance as a Dormant Account Fee and close your account.

Getting money into a Live Oak Bank savings account from an external bank account can take a little bit of time depending on how you do it. If you request the money through Live Oak Bank’s online portal, the funds won’t be available for up to five or six business days. But if you opt instead to send the money to Live Oak Bank from your current bank, the money will be available as soon as it’s received. Your Live Oak Bank savings account will start earning interest as soon as the money posts to your account.

You can easily withdraw your money at any time via ACH transfer. Simply log into your Live Oak Bank savings account and electronically transfer it to whichever bank account you wish. It’ll be available in two to three business days.

You are limited to making just six withdrawals per month with this savings account. That’s not a Live Oak Bank thing; that’s a federal regulation imposed upon savings accounts in the U.S. If you absolutely can’t wait until next month to make another withdrawal past your allotted six per month, you’ll be charged a $10 transaction fee for each additional action.

Live Oak Bank CD rates

Live Oak Bank also has some of the best CD rates with a decent deposit amount.

Term

APY

Minimum Deposit

6-month CD

2.30%

$2,500

1-year CD

2.80%

$2,500

18-month CD

2.85%

$2,500

2-year CD

3.00%

$2,500

3-year CD

3.05%

$2,500

4-year CD

3.10%

$2,500

5-year CD

3.15%

$2,500

  • Minimum opening deposit: $2,500
  • Early withdrawal penalty:
    • CD terms that are less than 24 months — 90 days’ interest penalty
    • CD terms that are more than 24 months — 180 days’ interest penalty

Live Oak Bank currently offers the highest CD rates. This bank’s minimum deposit requirements also seem to be right on par with other bank’s minimum deposit requirements. Currently, the best CDs out there have minimum deposit requirements both above and below Live Oak Bank’s $2,500 benchmark.

Only U.S. citizens and permanent residents are eligible to open these accounts. It’s a relatively straightforward process to open a CD: Simply complete the forms online, provide any needed documentation (such as your current bank account details), and wait for an account approval. Once your account is open, you can transfer over your deposit, where it will be held for five days before officially launching your CD.

If you need to take out your deposit early, bad news: As with many CDs, you’ll face an early-withdrawal penalty at Live Oak Bank. If your original CD term was for six months, one year or 18 months, you’ll be charged 90 days’ worth of interest. If your original CD term was for longer than that, you’ll be charged a higher rate of 180 days’ worth of interest.

If you are able to resist the urge to withdraw your money early, congratulations! Your CD will automatically renew into a second CD with the same term length. However, don’t panic if that’s not what you want: You have up to 10 days after the CD has matured to withdraw your money penalty-free and park it in your own bank account (whether it’s with Live Oak Bank or not).

It’s easy to overlook Live Oak Bank for other larger, more established consumer banks like Ally or Discover Bank. But Live Oak has some of the best CD rates around, and the best savings account available on the market today.

Lest you be scared away by its smaller name, consider this: This tiny-but-growing bank is getting rave reviews from customers and employees alike. It carries an “A” health rating, and has a top-notch online banking portal. About the only thing missing is a checking account to let you seamlessly do all of your daily banking with this great company.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lindsay VanSomeren
Lindsay VanSomeren |

Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here

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Advertiser Disclosure

Earning Interest

The Best High Yield Checking Accounts in 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

iStock

The money you keep in your checking account has a lot of valuable potential that can help you reach your financial goals. Sadly, this potential isn’t often realized because most checking accounts offer little to no interest, especially compared to savings and CD accounts. These high yield checking accounts are bucking that trend with sky-high rates that can put even the best savings accounts to shame. But, before you sling all of your cash into one of these accounts, there’s a few things you need to know.

Typically, these accounts come with a lot more strings attached than a regular checking account (you didn’t think they’d be offering all of this for free, did you?). In this article, we’ll help you make an informed decision about whether one of these high yield checking accounts are right for you and your financial goals.

How we picked the best high yield checking accounts

We followed a strict approach when selecting these accounts. We used the online rate finder for FDIC- or NCUA-insured rewards checking accounts on DepositAccounts.com, another LendingTree.com-owned site, to list the top 10 checking accounts with the highest rates. These rates were pulled on 7/9/18. We assumed a deposit amount of $100.

Credit unions were only included if they allow membership to anyone (such as by making a donation to their chosen charity). Finally, we filtered out any checking accounts that are not available nationwide, or that carry a health rating of below a B.

The best high yield checking accounts in 2018

America’s Credit Union

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You must complete the following four things each month:
    1. Have $15,000 in loans or deposits with ACU
    2. Have a $500 direct deposit
    3. Be signed up for eStatements
    4. Complete 10 debit transactions in person in store
  • Monthly service fee and how to waive it: No monthly service fee.
  • ATM fees: Your first 10 non-America’s Credit Union ATM withdrawals are free. After that, you’ll pay $1.00 per withdrawal at a non-America’s Credit Union ATM.
  • ATM refunds: None

LEARN MORE Secured

on America's Credit Union’s secure website

NCUA Insured

First Financial Credit Union (Illinois)

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You must complete the following two things each month:
    1. Be enrolled in eStatements
    2. Complete 15 signature-based debit card purchases
  • Monthly service fee and how to waive it: No monthly service fee.
  • ATM fees: Your first eight out-of-network withdrawals per month are free. Balance inquiries and cash withdrawals after your eighth withdrawal of the month are $1.00 each.
  • ATM refunds: $10 per month.

LEARN MORE Secured

on First Financial CU (IL)’s secure website

NCUA Insured

La Capitol Federal Credit Union

  • Minimum amount to open: $50
  • Requirements to earn the high APY: Make at least 25 debit purchases per month.
  • Monthly service fee and how to waive it: $2; waived if you enroll in eStatements.
  • ATM fees: None
  • ATM refunds: Up to $25 in out-of-network surcharges (the money the ATM’s owner charges you) per month if you are signed up for eStatements and make 25 debit purchases per month.

LEARN MORE Secured

on La Capitol Federal Credit Union’s secure website

NCUA Insured

Blue Federal Credit Union

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You must have completed the following three things each month:
    1. Make at least 10 debit transactions
    2. Be enrolled in eStatements
    3. Have at least one direct deposit, ACH deposit or withdrawal, or bill payment per month from your account
  • Monthly service fee and how to waive it: No monthly service fee.
  • ATM fees: $1.50 for out-of-network ATMs.
  • ATM refunds: $3 per transaction, up to $21 per month as long as you’ve met the requirements to earn the high APY. Otherwise, no ATM fee refunds will be given.

LEARN MORE Secured

on Blue Federal Credit Union’s secure website

NCUA Insured

One American Bank

  • Minimum amount to open: $50
  • Requirements to earn the high APY: You’ll need to do the following three things for each qualification cycle (be aware: their qualification cycles are not the same thing as a calendar month):
    1. Complete at least 12 debit purchases of $5.00 or more
    2. Be enrolled in eStatements
    3. Log into your Online Banking account
  • Monthly service fee and how to waive it: No monthly service charges.
  • ATM fees: None
  • ATM refunds: Up to $25 per qualification cycle if you meet the requirements to earn the high APY.

LEARN MORE Secured

on One American Bank’s secure website

Member FDIC

Heritage Bank

  • Minimum amount to open: $100
  • Requirements to earn the high APY: You’ll need to complete these three actions each month:
    1. Make at least 10 debit purchases
    2. Have at least one direct deposit or ACH post to your account each month
    3. Be signed up for eStatements
  • Monthly service fee and how to waive it: No monthly service fees.
  • ATM fees: Amount is at the discretion of the out-of-network ATM owner.
  • ATM refunds: $25 per month in out-of-network ATM surcharge fees (i.e., the fees that the ATM’s owner tacks on)

LEARN MORE Secured

on Heritage Bank NA’s secure website

Member FDIC

Consumers Credit Union

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You must complete the following four things each month:
    1. Make 12 Debit card point-of-sale purchases without using the PIN (all 12 must post and clear the account on or before the last day of the calendar month)
    2. Have at least one direct deposit, ACH debit, OR bill payment (using Consumers Credit Union’s online bill pay system) post and clear the account on or before the last day of the calendar month.
    3. Sign into their Online Banking system at least once each calendar month
    4. Be signed up for eStatements
      • Keep in mind that Consumers Credit Union will add an additional requirement each time the balance grows to earn the higher APY.
  • Monthly service fee and how to waive it: No monthly service fee.
  • ATM fees: None
  • ATM refunds: Complete reimbursement for all ATM fees charged from ATMs outside of their surcharge-free ATM network as long as you meet the minimum requirements of their Rewards Checking Account.

LEARN MORE Secured

on Consumers Credit Union (IL)’s secure website

NCUA Insured

Market USA Federal Credit Union

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You must complete the following actions each month:
    1. Be enrolled in eStatements
    2. Have monthly direct deposits of at least $250
    3. Use your Visa Debit Card at least 12 times a month with purchases that are $5 or more
    4. Make three online bill payments a month that are at least $20 each
      • This last requirement is what will qualify you for the Platinum tier
  • Monthly service fee and how to waive it: No monthly service fee
  • ATM fees: None.
  • ATM refunds: 8 free transactions per month when you sign up for direct deposit

LEARN MORE Secured

on Market USA Federal Credit Union’s secure website

NCUA Insured

Partner Colorado Credit Union

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You’ll need to do three things each month:
    1. Use your debit card to make at least 20 signature-based purchases of $5 or more
    2. Be signed up for eStatements
    3. Log into your Online or Mobile Banking account
  • Monthly service fee and how to waive it: $5; waived if you meet the requirements to earn the high APY.
  • ATM fees: None.
  • ATM refunds: All ATM surcharge fees are refunded.

LEARN MORE Secured

on Partner Colorado Credit Union’s secure website

NCUA Insured

Signature Federal Credit Union

  • Minimum amount to open: $0
  • Requirements to earn the high APY: You must complete the following things each month:
    1. Have at least one direct deposit into your account of $1,000 or more
    2. Be enrolled in e-statements
    3. Use your debit card to make at least 10 purchases per month
  • Monthly service fee and how to waive it: No monthly service fee.
  • ATM fees: None.
  • ATM refunds: Signature Federal Credit Union allows you to choose from either a higher interest rate, $10 in waived ATM fees, or debit card rewards points. If you choose the higher interest rate, they will not waive ATM fees.

LEARN MORE Secured

on Signature Federal Credit Union’s secure website

NCUA Insured

How are these banks able to offer such a high APY?

Did you notice that most of the institutions offering high yield checking accounts tend to be smaller names that you’ve probably never heard of? It turns out there’s a good reason for that, and it all has to do with some recent legal changes.

Back when the Dodd-Frank Act was passed in 2010, a tiny legislative nugget called the Durbin Amendment was included in the text. This amendment limited the swipe fees that big banks can charge merchants for each purchase that one of their customers makes using a debit card.

Suddenly, big banks could only charge half as much per swipe as they had been doing, and swipe fees became a lot more lucrative for smaller banks and credit unions instead.

That’s why so many smaller institutions have strict rules requiring you to use your debit card each month. According to the Federal Reserve, in 2016 smaller banks earned anywhere from 18 to 65 cents for each debit card swipe, compared to a maximum of just 22 cents plus 0.05% of the purchase price for larger banks.

Say, for example, a smaller bank requires you to make 10 debit transactions per month, and earns 65 cents from each transaction. Your bank would then earn $6.50 from your spending that month.

That is where the high interest rates come from. It’s also why the high interest rates are generally capped to smaller balances, so that you don’t earn too much money and negate all the swipe fees that the bank earns.

Is it worth meeting requirements to go after the high APY?

Some of these high yield checking accounts have a lot of requirements.

If you prefer to use debit cards, chances are you’ll be able to easily meet the minimum debit swiping requirements for most of these accounts. On the other hand, if you’re a cash or credit card junkie, you may find yourself frequently worrying at the end of the month about whether or not you’ve met the minimum debit swiping requirements. In this case, a high yield checking account might not be right for you.

Another thing to consider is that many of these banks require you to make a signature-based debit transaction, rather than a PIN-based debit transaction for it to count. Unfortunately, this is slightly less secure than using the PIN-based payment method.

You’ll also need to avoid making a rush of charges at the end of the month to meet the spending requirements. That’s because banks and credit unions will usually only count a charge that has finished posting to your account towards meeting the monthly swiping requirement. It can take a few days for debit swipes to post to your account, so it’s better to get these charges in early to make sure they post to your account in time to count.

The good news is that checking accounts aren’t designed to hold significant amounts of cash. That’s what a savings account is for, and you can still earn pretty good interest rates with a high yield savings account (although still nowhere close to these checking accounts).

If you’re going to keep a smaller deposit in your checking account anyways, why not earn as much as you can from it—especially if you know you’ll have an easy time meeting the requirements?

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Lindsay VanSomeren
Lindsay VanSomeren |

Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here

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