Best Bank CD Rates – March 2009
We’ve seen a downturn in the Best Bank CD Rates this month. With the FOMC giving signals that they won’t be raising rates anytime soon and the treasury buying their own debt, it has caused yields to drop.
Here are some of the top players in the market.
PenFed Credit Union – 5-year at 4.00% APY
Alliant Credit Union – 5-year at 4.00% APY, 3-year at 3.75% APY, 1-year at 3.15% APY.
Discover Bank – 30-months at 2.75% APY
GMAC Bank – 1-Year at 2.65% APY.
Corus Bank – 6-month CD at 2.32% APY. 1-Year at 2.81% APY
Key Bank – 5-year at 3.25% APY
Visions FCU – 1-Year at 3.05% APY
Wings Financial Federal CU – 1-year CD at 3.04% APY
Mountain America FCU – 5-year at 4.00% APY
Police & Fire FCU – 3-year at 3.75% APY.
Tips for finding the best Bank CD Rates.
Check your local newspaper. Many banks and credit unions will offer local specials because they want to attract relationship deposits. They want you to become more than just a number, but a valuable asset to them. A credit union in our area has been advertising a 7% savings rate on the first $1000.00 after a couple of conditions are met.
After JP Morgan took over Washington Mutual, the Sacramento branches are now becoming Chase Bank branches. As a result they are doing heavy advertising in the Sacramento and surrounding areas such as Yolo, Solano, and Placer County. You will still often find special rates on the internet that are higher, but I believe there is big value in keeping some funds locally. Biggest advantage is quick access if you need money fast.
Next, pick up the yellow pages. Call some of your local banks and see if any have any special rate offers. Some may be willing to pay a premium for some local funds.
Another tip, look at the rates of distressed banks. Many depositors want safety in FDIC insurance and bank quality. This allows the quality banks to offer somewhat lower rates, but troubled banks often have to offer high yield certificate of deposit rates. Bankrate.com has a Safe&Sound rating system. Look for some 2-star banks and see what kind of deals they have.
Finally, there is the internet search. The fact of the matter, no matter which route you go, it will be time consuming. At some point, you have to decide if the time is worth the higher CD interest rates. On the surface, the internet search is easy. You just go to your favorite search engine and type, “cd rates”, “best cd rates”, “ira certificates of deposit”, etc. But, you’ll need to wade through a tone of sites. Compare the interest rates across the sites carefully. Then compare the banks quality. Remember, often distressed banks may have higher rates, but you have to ask yourself how long will they last. Omni National Bank was recently closed by the FDIC and they have been offering some of the highest CD yields for quite some time.