For this week's weekly rate deal, we are traveling to Rake, IA where State Savings Bank is offering a 3.82% APY fixed IRA. I spoke to a representative at State Savings Bank and they told me about the IRA. Its term is basically a six month CD. If you opened the CD now, the term would be guaranteed through December 31st, at which point it would automatically roll over, unless you opted to withdraw the money. The bank represenative I spoke with told me that she didn't expect the rate to drop much in January, if at all. At that point, the FIRA would roll over at six month increments. Essentially, this behaves much like a six month CD but with a much higher rate.
For those unfamiliar with Fixed Rate IRAs, they behave much like CDs, expect they must be kept in a retirement account. The woman at the bank confirmed that the FIRA could be deposited into a Roth IRA or a traditional IRA, where the income from the investment grows tax free, or tax deferred. The money has to stay within the IRA until retirement or it will be hit with substantial early withdrawal penalties. Lean more about FIRAs.
The minimum balance to receive this rate is $1.
State Savings Bank is a small bank with one branch and $53 million in assets. It has a low Texas Ratio of 13.5% (below the national average of 21.06%). The bank's assets have grown from $40 milion in 2006 to $52 million in 2011.
FIRAs can only be opened at the branch, so you'll need to live close to Rake, IA to take advantage of this bank deal. But even if you don't there are many deals in your local area. Find the best IRA rates in your local area or state.