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Bank CD Rates
Old 11-01-2008, 05:41 PM   #1
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Bank CD Rates

Tried to get a CD at my bank and my "very best customer" status meant they offered me 3.15% instead of the standard 3%. Phooey. Even so, when I went back the next day even that rate was gone and now they were offering only 2.5%. Meanwhile banks can borrow from the Fed for just 1%. If they can get all the 1% money they want, why do they offer any CD rates higher than that at all? Should I anticipate rates to keep dropping until they are approaching 1%. That sounds unpleasant for savers who want the safety of FDIC insurance.
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Old 11-01-2008, 06:36 PM   #2
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CD rates are currently 4.5%-5.25%, depending on the term. They are likely to go down a bit with the recent federal rate cut, unless it is raised back up again soon, CD rates have not dropped out of the 4% range anytime in recent history. I would use a local bank for services like a banking account and other such things, but not for something significant like a CD (just like I wouldn't have my bank doing my investing for me). Almost every bank I have heard of has a "customer retention plan," but they are usually not impressive.
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Old 11-01-2008, 08:38 PM   #3
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On Monday, I'm gonna park $50K in a 12 month CD at my credit union @ 3.5%. I checked PenFed and they were lower than that for a 12 month CD. Also checked a few local banks and they weren't any higher, generally lower. I live in Wisconsin now, and I'm still doing business with my federal credit union back in Louisiana.
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Old 11-01-2008, 08:59 PM   #4
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ING has a 12 month CD at 4.25%

ING DIRECT - Save Your Money!
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Old 11-01-2008, 09:00 PM   #5
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We just went down to the local bank yesterday and picked up a 12 month CD @ 4.0% APY......it was 3.8% the day before (and that's what still showed on their rate board in the lobby) but went UP after the Fed cut their rates again. Also picked up another 12 month CD with ING Direct yesterday afternoon for 4.25% APY.

The CD rates at almost all of our local banks, as well as at ING, have been steadily going up since early summer.....and they continue to do so.

Heck, growing_older, ING Direct is paying 2.75% APY on their standard savings accounts, which is better than your bank gives on CD's! I think your bank is trying to stick it to their customers....IMHO and from what I'm seeing around these parts anyway!
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Old 11-01-2008, 09:15 PM   #6
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If they can get all the 1% money they want, why do they offer any CD rates higher than that at all? Should I anticipate rates to keep dropping until they are approaching 1%.
Once I start thinking about it, this is the part that confuses me. Why would banks offer anything more than the fed rate? Surely legions of individual depositors and their attendant record keeping are more difficult and expensive than sending one big truck to the discount window from time to time.
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Old 11-01-2008, 09:16 PM   #7
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Originally Posted by Sue J View Post
ING has a 12 month CD at 4.25%

ING DIRECT - Save Your Money!

Wow! Thanks for the info!
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Old 11-01-2008, 10:02 PM   #8
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Similar higher rate from GMAC Bank GMAC Bank : Online Bank with High CD Rates and Money Market Rates and I found a list that updates at Compare Mortgage Rates | CD Rates | Credit Cards Home Equity Loans Mortgages Best Rate Calculator Bankrate.com
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Old 11-02-2008, 07:29 AM   #9
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There are things to think about with banks including on-line versions. If you get disabled, will they honor your power-of-attorney? At least one of the on-line banks mentioned in this thread will not!.
Can you get your account set up as community property. For those of us in Community Property states, this can be important for estate purposes.
Does the bank offer trust accounts? If your estate includes this item, your spouse could be stuck with a cd that can't be turned-in or xfrerred to the bypass trust. Several on-line banks don't do this.
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Old 11-02-2008, 08:21 AM   #10
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There are things to think about with banks including on-line versions. If you get disabled, will they honor your power-of-attorney? At least one of the on-line banks mentioned in this thread will not!. .
This, as you imply, could be an issue with more than just online banks. Many local banks as well as my broker and many mutual fund companies have requested that I fill out their own POA forms. This is interesting since attorneys who gives these living trust presentations offer to throw into the package their POA. I wonder if the same problems would be present w/ theirs. The institutions never asked where my POA came from , just that I needed to fill theirs out.
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