Archive for August, 2009
Washington Fed Pays 2.50% On 2-Year CD
Here’s another example of the competitive CD rates we’re finding in the Pacific Northwest.
Seattle-based Washington Federal Savings is paying a 2.50% APY on a 24-month CD with a minimum deposit of $1,000.
If this deal was nationally-available, it would be near the top
of our rankings of the best 24-month CD rates.
But it’s not and you can’t apply online.
To open an account you’ve got to visit one of Washington Federal’s 124 branches in eight Western states.
This certificate of deposit is also available at a couple of banks it owns — First Mutual Bank, with 13 branches in Washington, and First Federal Bank, with 13 branches in New Mexico.
Since Washington Federal doesn’t even post CD rates on its Web site, call your local branch to confirm it’s still being offered before making the trip.
Click here for the address and phone number of the one nearest you.
You can use our extensive database of CD rates to compare this offer with the best deals from scores of banks.
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Competition Spurs CD Rates In Northwest
Banks in the Pacific Northwest appear to be doing something we haven’t seen in almost a year — competing for our money.
Calling this a rate war would be a stretch.
But a couple of regional banks are offering some of the best CD rates you’ll find anywhere in the country.
Frontier Bank, which has more than 40 branches in Washington and Oregon, is paying 2.60% APY on 24-month certificates of deposit with a $500 minimum deposit.
Invest at least $50,000 and you can earn 2.70% APY.
That topped our August rankings of the best, nationally-available 24-month CD rates.
Banner Bank is paying 2.50% APY on a 21-month CD, with a minimum deposit of $2,500.
You must apply online to get the Internet special, but it’s only open to residents of Washington, Oregon and Idaho, where Banner operates more than 100 branches and loan offices.
Community banks have leapt in, some with even better rates.
The Bank of Oswego, with two branches in Lake Oswego, Ore. is offering 2.75% APY on a 24-month CD with a $1,000 minimum deposit.
Although it says the rate is available nationwide, you can’t apply on-line. To open an account you have to speak with a customer service representative at 503-635-1699.
We wouldn’t be surprised if interest in this CD swamped Bank of Oswego’s phone lines and quickly forced it to limit this rate to local customers.
But with CD rates at or near record lows, savers need more of this.
Click here to compare these deals with the best CD rates from dozens of other banks in our extensive database.
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Turning To Angie To Find A New Doctor
I wanted a new dermatologist.
Not only did my ex-doc’s smarmy billing tactics piss me off, but he made me feel like an ATM machine: He got his cash and he got me out of there.
I wanted a doctor who would take time with my office visits, listen to my concerns, look at my medical history and offer solutions instead of a wham, bam, thank you ma’am approach.
I talked to my primary care physician about recommendations, but all he offered was a list of dermatologists who take my insurance.
So I decided to look on Angie’s List and walked away an empowered consumer. MORE
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Dependable High-Yield Checking Accounts
Hats off to three banks that haven’t succumbed to the temptation to lower the rates or reach of their high-yield checking accounts this spring or summer.
Bank of the Sierra, Patiot and Ouachita Independent are still paying more than 4% and offering their reward checking accounts, as they’re often called, nationwide.
Of course you’ve got to live with all the special rules that come with this kind of checking account, such as making a minimum number of debit card purchases each month.
But try to find a bank offering 4% on a CD, even if you’re willing to tie your money up for five years or more. MORE
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Docs Are Over-Collecting From Patients
I just had a doctor overcharge me (twice) and keep the extra money until I figured out what happened.
First I was asked to make an erroneous co-payment.
Then I was billed too much to cover what my health insurance company didn’t pay.
The doctor kept the extra money as a credit on my account without telling me, even though I had no intention of ever returning.
It appears to be part of a trend in which physicians are trying to collect as much as they possibly can from patients without waiting to see how much they’ll be paid by insurers. MORE
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Finovate 2009 Demoing Company Lineup Complete
Today, we’re revealing another handful of the leading fintech companies that will demo their latest and greatest innovations at Finovate 2009 on September 29 in the heart of NYC. The quality and diversity of the ideas that will be demoed on stage is very high this year and we’re incredibly excited to showcase all the chosen companies to you.
The additional companies are:
These four companies join 26 we’ve already announced (list below) as well as two great startups still in “stealth” mode that will debut at the event.
These companies will be showcased to an audience of senior financial/banking/credit union executives, influential press, industry analysts, venture capitalists, bloggers, tech companies and entrepreneurs.
A few of the organizations already committed to attend include: Bank of America, Citibank, WSJ, Microsoft, HSBC, Wells Fargo, American Express, Dow Jones, the Financial Times, E*Trade Financial, SunTrust, ANZ, Capitol One, Financial Insights, Discover, Sybase, Cardinal Venture Capital, Intuit, Consumer Reports, DataMonitor, Canaan Partners, The Economist, BusinessWeek, and Aite Group.
We’d love to have you join us at the fall event and watch the future of finance/banking unfold onstage. If you register before the end of August you’ll save $100 via the early-bird ticket discount.
P.S. Online Banking Report subscribers save even more on tickets to all our events PLUS they obviously get 12 months of great research.
PocketSmith and Cashflow Insite are Newest Online PFMs
Last September, six online personal finance managers launched in a single month (previous post). Since then, just a handful of new PFMS have appeared online. Most newcomers have instead chosen the iPhone where more than 1,000 finance apps have launched in the past 12 months.
The iPhone is great for on-the-go transaction processing, but most PFM users will still do their heavy lifting at their computer, setting budgets, tracking expenses, planning for the future, preparing tax returns and so on. So the online venue is still the key competitive battleground.
Two new online efforts have come to my attention in recent weeks. We’ll look at them in more detail later this year (see note 1).
Cashflow INSITE, from Neuralus. The Winnipeg, Canada-based startup is looking to partner with banks and credit unions to deliver the PFM. The company is also targeting the financial advisor market where they have a number of independent advisors paying a flat fee (currently under $100/mo) to support up to 100 clients on the Cashflow INSITE platform. 
PocketSmith, a New Zealand-based firm which launched its beta last year, uses the popular calendar approach to tracking personal cash flow and appears to be gaining some traction in the United States. It’s monthly unique U.S. visitor total in July was more than 8,000 according to Compete (see chart below). That puts it at number 13 of the busiest online PFMs in the U.S. according to estimates from Compete (note 2). It’s also the highest ranked newcomer to the chart and the non-US PFM with the most U.S. traffic.
PocketSmith monthly traffic estimates from Compete
Monthly unique visitors Aug. 2008 through July 2009
Cashflow INSITE homepage (21 Aug 2009)
PocketSmith homepage (21 Aug 2009)
Notes:
1. We covered the personal financial management space several times in Online Banking Report, most recently: Personal Finance Features for Online Banking; Social Personal Finance; and Online Investing Communities.
2. See the current issue of Online Banking Report: 2010 Planning Guide, for the U.S. traffic estimates for 28 online PFMs.
The Greatest Deals In Bankahistory
Happy Birthday to us!
Bankaholic is three this summer and we thought it would be a good time to look back and pick our 10 favorite, dare we say greatest, deals.
We combed through almost 600 posts to find everything from sky-high CD rates to the best gift for opening a new account — and it ain’t no stinkin’ toaster.
Savings accounts that paid 6%. Mortgages that cost only 4.3%. Credit cards that charged no interest for a year, or gave you a free airplane ticket just for signing up.
They all made the list. MORE
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Citi Takes Lead In 18-Month CD Rates
It’s been a long time since a big bank had a CD rate that made us sit up and take notice.
But Citibank is offering 2.25% APY on an 18-month certificate of deposit with a very modest $500 minimum deposit.
That’s the best nationally-available deal on an 18-month CD that we know of, beating the 2.13% APY from Discover Bank, OneWest Bank and MetLife Bank. (They have much higher minimum deposits, too.)
The Federal Reserve and Treasury Department have been pumping so much cheap money into the big banks that they haven’t needed our savings.
Ever since the banking crisis struck last the best rates have come from smaller banks that still needed to compete for deposits.
But desperate savers would flood those banks so much money they’d quickly lower their rates, sometimes in a matter of days, contributing to the extraordinary volatility we’ve seen in CD rates this year.
Could Citi be leading the big banks back into the market?
Use our database to compare Citi’s offer with the best CD rates from scores of other banks.
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More Record Lows For Short-Term CD Rates This Week
Although short-term CD rates drifted down to new record lows this week, longer-term rates held their own.
Returns on 24-month and 60-month certificates of deposit may have bottomed out and perhaps short-term CDs will join the trend over the next month or so.
But it’s time to start talking about how we can stop the Federal Reserve from punishing savers every time the nation’s banking industry goes on a bender and needs to be bailed out.
Bankrate’s weekly survey of large banks and thrifts taken Aug. 19 found the average annual yield for a:
3-month CD declined to 0.48% from 0.49% the previous week. That’s the lowest average since Bankrate began tracking 3-month CD rates in March 1989.
6-month CD fell to 0.74% from 0.75% — the lowest average since Bankrate began tracking 6-month CD rates in January 1984.
1-year CD fell to 1.05% from 1.06% — approaching the record low of 1.03% set in July 2003.
2-year CD held at 1.51% for the fourth-straight week after declining to 1.46% in June, the lowest average return on 24-month CDs since August 2003.
5-year CD rose to 2.17% from 2.16% after declining to 2.15% in July, which was lowest average rate since Bankrate began tracking 60-month CDs in January 1984.
Of course you can earn more than that if you use our extensive database of CD rates to search for better-than-average deals.
But the sorry fact is that the best rates you’ll find right now are lower than the average rates we were enjoying last summer and fall.
The most encouraging trend is that we’re now 10 weeks removed from the low-point for 2-year CD rates and five weeks out from the low-point for 5-year CD rates.
Finding the bottom in this terrible market is almost certainly the best we can hope for this summer.
The Federal Reserve has been pushing interest rates artificially low as part of its effort to rescue the banking industry from its reckless lending binge of the early 2000s and the recession it created.
To do that, the government-controlled bank has dropped what it charges commercial banks to borrow money to rock-bottom levels — 0% to 0.25% for overnight loans.
With the government providing so much cheap money, the banks can pay next to nothing on certificates of deposit, money market and savings accounts.
When the Fed’s interest rate committee met last week it reaffirmed what we all feared — raising the overnight loan rate, the first step towards higher CD rates for savers, isn’t even on the radar screen.
The Fed’s willingness to punish savers for as long as it takes to save the banks — and primarily the big banks — is why we need to get serious about changing the nation’s central bank.
We can’t let the Federal Reserve and its Chairman Ben Bernanke off the hook for allowing this crisis to happen on his watch.
The Fed has always acted as the protector, not the regulator, of the nation’s biggest banks. If the Fed had been acting in our best interests, it would have stopped the irresponsible lending long before the banking industry was on the verge of total ruin.
It’s willingness to repeatedly punish savers in the pursuit of protecting the big banks is unforgiveable and rarely if ever acknowledged by Bernanke or anyone else at the Fed.
This essay, “The Federal Reserve Is Immoral”, by software engineer and blogger Tim Iacono provides a provocative and compelling argument for abolishing the Fed.
But lets get real. The big banks, with their army of lobbyists and millions in campaign contributions, would never let that happen.
What we need to do is start demanding that President Obama oust Bernanke when his term as chairman expires on Jan. 31 and replace him with someone who will chart a fundamentally different course for the Fed.
We need a Fed chief who will truly regulate the banks and help the millions of millions of Americans who ask for no more than an honest return on their savings.
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