Savings Rates and Money Market Account RatesSavings account rates: Search and compare the best savings account rates and the best money market account rates from banks and credit unions. You can search for the highest interest savings rates and MMA rates in the state you live in or by the zip you live in. Once you have entered your search criteria a list of the top savings accounts rates and money market account rates will be displayed. Most savings account interest rates displayed are for regular savings accounts or for Individual Retirement Account (IRA) savings accounts.
Savings account rates remain stable this week but the prospect for higher rates is looking more likely. The Department of Labor released employment numbers for April that were much stronger than expected. For the month of April, 288,000 non-farm payroll jobs were created, which was much higher than the 200,000 jobs analysts were expecting. The unemployment rate fell to 6.3 percent from 6.7 percent, the lowest point since 2008.
Surprisingly, long term bond rates didn’t increase on the strong job numbers. Usually when job creation is strong and the unemployment rate tumbles, it is an early indication of higher inflation in the future due to higher wages. According to the Federal Reserve, there is still a considerable amount of “slack” in the labor force, which will keep a lid on wage inflation.
Current savings rates and money market rates on account balances of at least $10,000 are averaging 0.45 percent this week, up slightly from last week’s average rate of 0.43 percent. The best savings rates in our rate database remain at 0.95 percent with an APY of 0.95 percent. The best money market account rates also remained the same at 0.90 percent.
If the unemployment rate continues to fall quickly and the number of jobs created monthly is in the 300,000 range, interest rates will move higher sooner than later. Deposit interest rates are dependent on a higher fed funds rate which the Federal Reserve has kept near zero percent for more than 5 years.
The Fed is expected to increase the fed funds rate sometime in the summer or fall of 2015 but that could change. We might see interest rates move higher in the spring of 2015 or possibly in the last quarter of 2014. Make no mistake, deposit rates are going up in the coming years, the question is when.
To help you with the never ending search for the highest savings rates and money market rates we have listed the best rates for this week.
Best Savings Account Rates
Best Money Market Account Rates
Heading into 2014, we are facing the prospect of waiting until 2015 for higher savings rates and money market rates. Average deposit rates on savings/money market accounts with balances of $10k is currently at 0.43 percent as reported by MonitorBankRates.com. The FDIC’s national average savings rate this week is much lower at 0.06 percent and the average money market rate is also much lower at 0.09 percent.
These average rates have been hovering around these current levels for years now. Thankfully there are banks offering both savings rates and money market rates well above the averages. The best savings rates this week on our rate table are at 1.00 percent with an APY of 1.00 percent. The best money market account rates are also much higher at 0.90 percent.
Best Savings Rates January 2014
Best Money Market Account Rates January 2014
We have seen wild swings in short term U.S. Treasury rates the past month while savings rates have remained stable. Treasury rates on bonds of 1 year or less rose during the government shutdown and with the looming possibility of the U.S. Government defaulting on its debt. After a deal was reached, rates on bonds declined to levels prior to the shutdown and have declined further on a weak employment report.
Yesterday’s employment numbers for the month of September, released more than two week late because of the shutdown, showed 148,000 jobs were created. Job growth for the month was less than what analysts expected. This sent bond rates down further because the Federal Reserve is more likely to keep their stimulus measures going for now.
Best Savings Rates/ Money Market Rates October 2013
Banks and credit unions are increasing the rates they are paying on savings accounts but the best savings rates available in our database are still at 1.00 percent. The same trend is happening for rates on money market accounts in that rates are increasing but the best rates are still at 0.90 percent.
The best savings rate available right now is from The Palladian PrivateBank at 1.00 percent. On our rate tables, we also have three banks offering savings account rates at 0.90 percent. CIT Bank, Barclays Bank, and GE Capital Retail Bank are all offering rates at 0.90 percent.
The best money market rate in our database at 0.90 percent is from the Sallie Mae Bank, the banking division of the student loan company Sallie Mae. We also have EverBank offering money market rates at 0.86 percent and Mutual Omaha Bank offering rates at 0.85 percent.
Slowly Inching Towards a Higher Federal Funds Rate
Deposit rates are tied to the federal funds rate which has been in a range of zero percent to one quarter percent since December 2008. This policy has sent deposit rates down to the lowest levels in generations and has kept a lid on rates rising though that is about to change.
The Federal Reserve has said the fed funds rate will stay at current levels until the nation’s unemployment rate falls below 6.5 percent. While the September employment report was lackluster, the unemployment rate fell to 7.2 percent from 7.3 percent. For the past year or so, the rate has been falling on average about 0.1 percent a month.
If that trend continues, the unemployment rate could be at 6.5 percent in the April 2014 report. The April report will be released the first Friday of May. That is unless the government has been shut down again.
When Will Deposit Rates Increase and How Fast Will Rates Move Higher?
The Fed is scheduled to meet on April 29 and April 30, 2014. If the Fed decides to increase the fed funds rate at that point, savings rates, money market rates, and CD rates could start moving higher in May 2014. The first increase and subsequent increases in the fed funds rate will probably be in 50 basis point increments.
After the April meeting, the Fed will meet again 5 more times in 2014. The meetings are scheduled in the months of June, July, September, October, and December. If the unemployment rate continues to fall during 2014 and the economy picks up steam, the Fed may increase the federal funds rate after each meeting.
If that scenario plays out, we could see a federal funds rate of 3.00 percent which historically speaking isn’t high and a 3.00 percent rate will be a neutral rate, neither increasing growth nor constricting economic growth. A 3.00 percent fed funds rate will mean savings rates and deposit rates around 3.50 to 4.00 percent and 1 year CD rates near 4.00 percent.
Stay Liquid in Savings Accounts and Money Market Accounts
Since interest rates are moving higher over the next year, one thing we’d recommend is to not lock in a low rate in a long term certificate of deposit. A better bet is to stay liquid in savings accounts or money market accounts.
Another option is to invest in shorter term certificates of deposit. Right now on our 6 month certificate of deposit rate table we have one bank, Zions Direct, offering 6 month rates at 1.00 percent.
Savings rates at credit unions in the state of California are very competitive right now and many credit union’s rates in CA are at the top of rates available anywhere. The best savings rates from any bank right now are around 1.00 percent though you might find some credit union’s dividend rates are also double the going average.
Higher Savings Rates Come with Caps and Restrictions
Credit unions offering a savings interest rate much higher than prevailing rates usually limit the amount of money that can be deposited into the account. One other point to make regarding credit unions is that you are required to join the credit union in order to open an account. Eligibility is usually living, working, or worshiping in a certain area or having a family member that does.
Best Credit Union Savings Rates
The best credit union savings account rate in CA right now is from Foothill Federal Credit Union at 1.50 percent APY. Foothill FCU’s generous rate is on their SummerTime Savings Account. There is a minimum deposit of $50 and a maximum deposit of $2,000 that can earn this rate and yield.
Another CA credit union offering a rate higher than 1.00 percent right now is FME Federal Credit Union (FMEFCU) at 1.25 percent with an APY of 1.26 percent. There are some requirements and restrictions on FMEFCU’s Direct Deposit Savings Account. To earn this rate and yield, you have to set up a direct deposit. You’re also not allowed to make any other deposits or withdrawals. The maximum amount that can earn this rate and yield is $15,000.
Another credit union in California that is offering a rate of 1.25 percent and a yield of 1.26 percent is First Imperial Credit Union. FICU’s Christmas club savings accounts and summer saver accounts earn this rate and yield. I didn’t see any balance caps on these accounts on FICU’s website. You can call this credit union at (760) 352-1540 to find out more.
There are hundreds of other credit union’s in CA offering competitive rates just above or below 1.00 percent. If you’d rather not join a credit union to obtain a slightly better rate, search our rate tables for the best bank savings rates available at Monitor Bank Rates.
Weekly average savings and money market rates barely moved this week. The best interest rates available are also stable, but during this time long term United States Treasury yields are soaring. Yields are moving higher because the markets believe the Federal Reserve will stop buying long term Treasuries.
Quantitative Easing’s Affect on Interest Rates
The Federal Reserve has been selling short term Treasuries and buying long term Treasuries to keep long term interest rates low. This policy, known as quantitative easing (QE), is the third round of easing the Federal Reserve has embarked on. The markets are anticipating an end to QE3 due to strong economic data released the past month.
Ending quantitative easing won’t send short term or long term deposit rates higher. Until the Federal Reserve increases the fed funds rate, deposit rates will remain low. The Fed will increase the fed funds rate sometime in the middle of 2014 once the unemployment rate falls below their target of 6.5 percent.
Average Interest Rates This Week
Savings rates and money market rates on account balances of at least $10,000 are averaging 0.47 percent, unchanged from last week’s average rate. Account balances of at least $25,000 are averaging a rate of 0.61 percent, up from the prior week’s average rate of 0.59 percent. Interest rates on account balances of at least $50,000 are averaging 0.66 percent, down from last week’s average rate of 0.67 percent.
Below are lists of the best savings rates and best money market account rates today:
Best Savings Rates June 11, 2013
Best Money Market Rates June 11, 2013
There we no big moves in available rates as credit union savings rates and bank savings rates remained stable this week. Credit union savings rates on average remain 0.10 percent higher than the average bank savings rate this week. Average CD union savings account rates remain unchanged at 0.22 percent and the average bank savings account rates remained changed at 0.12 percent.
The highest bank savings rate on our rate list also remained unchanged this week. The highest savings rate at 1.00 percent is offered by two different banks, CIT Bank and Barclays Bank. These banks are offering rates that are more than 8 times the average rate. The FDIC average savings rate is even lower this week at 0.07 percent.
Other banks on our rate list offering savings rates much higher than the average rates include FNBO Direct, Mutual of Omaha Bank, and Colorado Federal Savings Bank, all offering rates at 0.85 percent with an APY of 0.85 percent. Ally Bank has the third highest savings account rates in our database this week at 0.84 percent.
The fourth highest bank savings rate on our rate list this week are from two different banks. Discover Bank and Bank of Internet USA are both offering savings rates at 0.80 percent with an APY of 0.80 percent. There are many banks on our rate list also offering money market rates well above the average rates. The highest money market rate on our list is week is from EverBank at 1.01 percent APY.
Moving onto the best savings rates from credit unions, State Farm Federal Credit is offering share savings rates at 0.90 percent with an APY of 0.90 percent. Platinum Federal Credit Union is currently offering their share savings rates at 0.75 percent with an APY of 0.75 percent. Guadalupe Parish Credit Union is also offering share savings account rates at 0.75 percent with an APY of 0.75 percent.
Anyone can open a savings account at any bank but opening a savings account at a credit union is restricted. You have to join a credit union and you have to be eligible to join a credit union. Eligibility requirements are usually the following: You have to live, work, or worship near the credit union or have a family member that does, depending on the type of union it is.
If you are eligible to join a credit union, you have to first open a share savings account to be able to do any other transactions. All credit unions post eligibility requirements on their website so you can easily find out whether or not you can join.
Current savings rates which are still just above record lows will start rising next year due to a stronger economy and the Federal Reserve. The economy has been trudging along for many years now. We have had several years of growth after the “Great Recession,” but not enough to lower the persistently high unemployment rate.
The economy has been aided by the Federal Reserve’s actions to drive interest rates to record lows in order to spur economic growth. The economy has hit a bump recently thanks to both parties in Washington not being able to come to agreements on important fiscal policies.
In fact, the advance estimate for fourth quarter Gross Domestic Profit (GDP) showed an economy that contracted 0.1 percent, mainly due to investors and consumers wondering how Republicans and Democrats would deal with the expiring Bush tax cuts.
Thankfully, a last minute deal was reach between both parities but not before some damage was already done to the economy. The fourth quarter GDP didn’t contract, the second estimate in fourth quarter GDP showed the economy expanded 0.1 percent. I firmly believe growth would have been higher if it wasn’t for all these fiscal decisions being made at the very last minute.
The most recent fiscal log jam in Washington was sequestration, the automatic
When you already have an economy that is underperforming and is expected to only grow at 2.00 percent in 2013, a 0.5 percent bite in GDP growth will be felt. Economists also believe 500,000 jobs will be lost due to the sequestration. The last piece in the fiscal puzzle is funding the government for the coming fiscal year. At least both parties agree to raise the debt ceiling to fund the government until September 2013.
This brings us back to bond yields and interest rates. When Washington is finished creating so many obstacles for the economy’s growth, it should start taking off. A stronger economy will send interest rates and bond yields higher but the fed will also have a hand in forcing interest rates and bond yields higher.
The fed has accumulated just over a $3 trillion dollar balance sheet that it has to start unwinding (selling). Once the fed starts selling Treasuries, yields will move higher. Many believe yields will start moving higher before the fed sells Treasuries because investors will anticipate the fed selling and sell before them.
All of these market forces will eventually send savings rates and other deposit account rates higher. Right now the best savings rates at credit unions and banks are just above 1.00 percent and we could start seeing rates move higher in 2014.
Many people are unaware that their bank or credit union probably has a service that allows you to link your checking account to a savings account, line of credit or credit card to cover overdrafts. Most banks and credit unions don’t automatically setup this service when you open an account, you have to ask to have the accounts linked.
The average person only keeps enough in their checking account to cover their monthly expenses because most checking account rates are either very low or at zero percent. As a result most people place their extra cash in a savings account because savings rates are better then checking rates. By doing this you run the risk of either having a check bounce and having to either pay a bounced check fee or an overdraft fee.
Neither is cheap, in fact by bouncing a check you might also be responsible for the other parties fees or end up being late on a bill which can also cost you more money. Sometimes this can happen multiple times in one month costing you a lot of money in fees. In addition, interest is charged on any amount that is placed on your credit line or credit card.
The smarter way to cover yourself is linking a savings account which will cost you much less in fees. You should compare the fees to other options to see what is best for you. Some banks also have a minimum transfer amount each time the bank transfers money from a savings account. Be sure to find out whether your bank or credit union has such a minimum.
You can find the best savings rates and checking account rates by searching our database of rates. We list both regional rates and national rates from credit unions and banks.
Credit union share savings account rates and bank savings rates are low these days. You’d be lucky to find any bank or credit union offering savings rates much higher than 1.00 percent. You can find some credit unions that might offer a rate as high as 5.00 percent but the maximum balance on those high yielding savings accounts are very restricted – usually only the first $500 or $1,000 can earn that rate and yield.
Credit Unions across the United States offering rates above 1.00 percent including credit unions offering share rates above 3.00 percent. Pioneer Muslim Credit Union has current rates at 3.03 percent. Houston Police Credit Union of Texas is also offering one of the better rates at 2.02 percent.
Alabama Telco Credit Union is offering rates at 3.00 percent and Navigator Credit Union has current rates at 2.27 percent. Genuine Parts Credit Union is offering savings rates at 2.02 percent.
Connecticut State Employees Credit Union is offering current savings rates at 1.01 percent. Moving down the East Coast, we find Delaware Alliance Credit Union offering rates at 1.05 percent. In North Carolina, we see United Services Credit Union is offering rates at 1.15 percent.
In the state of Utah, we find Utah Power Credit Union is offering regular share savings rates at 1.36 percent. On the West Coast in Washington State Avista Corp. Credit Union is offering share savings rates at 1.16 percent. In California we have Foothill Federal Credit Union offering rates at 1.50 percent.
One of the largest credit unions, Pentagon Federal Credit Union (PenFed), is offering one of the highest rates available at 1.25 percent for a 1 year certificate (CD) rate. The opposite is true with their lowest share savings rates at 0.19 percent. Navy Federal Credit Union is another large credit union with one of the lowest rates at 0.25 percent.
There are many credit unions that offering some of the highest rates available. There are, however, requirements for you to join any credit union so you might not be eligible to join the credit union of your choice. You are usually required to live, work or worship near a credit union to be eligible to join or have a family member that qualifies so you can join.
Recent stronger than expected economic news in 2013 brings us hope savings rates and money market rates will increase sooner than the expected mid-2015 time frame in which rates are expect to remain near record lows. The Federal Reserve has stated they plan to keep the Fed funds rate at near zero percent until mid-2015 to help the economy, housing market, and to lower the unemployment rate.
Over the past couple of months a series of strong economic reports have been released including stronger than expect housing starts, housing sales and higher home prices. Other positive news includes the highest consumer confidence in over four years and stronger than expect Gross Domestic Product (GDP) for the third quarter of 2012.
The last hurdle to higher interest rates is the second part of the fiscal cliff. The tax part of the fiscal cliff was figured out by Republicans and Democrats in Washington. The last pieces in the puzzle are on the debt side of the fiscal cliff. There are three debt issues coming up over the next few months – the debt ceiling limit, the sequester, and the annual appropriations that have to be decided on.
Negotiations on these three will be a lot harder than the tax side of the fiscal cliff. Markets will be subjected to daily or weekly negotiations – both good and bad. Hopefully agreements can be made without too much damage to the economy, investor confidence, and consumer confidence.
Once we are past the debt hurdle, the economy should take off due to pent up demand – especially in housing. A strong economy will lead to a quick drop in the unemployment rate which will lead to the Federal Reserve increasing the Fed funds rate and discount rate. When these rates move higher, banks and credit unions will increase savings account rates.
There are a lot of variables in our belief that interest rates will move higher in 2013. If the increase in rates start, it will be in the second half of 2013 and most likely in the fourth quarter. You can use our rate tables to find the best savings account rates and best money market account rates nationally.
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