May 2018 Brings Higher Savings Rates – Here are 5 That We Think Will Continue to Go Up

May 2018 Brings Higher Savings Rates – Here are 5 That We Think Will Continue to Go Up

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As we begin May 2018 and approach the second and third meetings of Jay Powell’s tenure as Chairman of the Fed, we are continuing to see savings rates firm up.

While savings rates are improving, they are not where we expect to see them this time next year and still well below any historical norm. To boot, the yield curve is lacking slope. So while BestCashCow is the most comprehensive site listing savings and CD rates, we continue to urge caution when it comes to CD rates, especially those longer than one year.

This month, we’d therefore prefer to focus just on five savings and money market products that we find particularly interesting. We’re highlighting these products not only because the current rates are attractive, but because there has been some discussion in our conference rooms about banks that offer teaser rates and then lower them. We don’t believe either that these five banks have engaged in such tactics or that they will be lowering their rates as the Fed moves the Fed Funds rate higher.

So, here are five savings accounts that we would bet will continue to be competitive.

1. EBSB Direct – 1.80% Online Money Market rate

EBSB Direct is a familiar name to many who have followed the online deposit account space for the last few years. At various points, they have aggressively courted savers, and this rate represents a consistency in that approach. Earlier this year, their rate had been 1.57% and 1.44%. EBSB Direct has great reviews on BestCashCow. High net worth depositors will appreciate the fact that the rate is extended to all deposits up to $2 million, and that as a subsidiary of East Boston Savings Bank, a Massachusetts chartered bank, DIF insurance covers that amount.

2. Purepoint – 1.75% Online Savings rate

We wrote about Purepoint in April and we have written about the bank before. As a subsidiary of one of Japan’s largest financial institutions and as an aggressive player in the US market that seems determined to gain market share, we’d bet on Purepoint to continue to raise rates as the Fed moves.

3. Marcus – 1.60% Online Savings rate

With generally outstanding reviews on BestCashCow, we think that Marcus is a good place to stash cash. Marcus is also a subsidiary of Goldman Sachs and if you listen to their executives on Bloomberg or CNBC, you’ll see that they have made a real commitment to the online savings and CD spaces and we doubt they will be doing anything other than raising rates as the Federal Reserve moves. To boot, Marcus is perhaps the only one of the major online banks where it seems very safe to go well over FDIC-insurance limits.

Editor’s Note: Marcus is an advertiser of BestCashCow. Please read our Advertiser Disclosure here.

4. Personal Savings by American Express – 1.55% Online Savings rate

Amex’s online savings product was once the highest rate around in 2009 and 2010 when they were offering 0.90% while other rates had fallen below that level. While Amex hasn’t been as quick to raise rates out of the zero-rate environment as many others have, their reviews on BestCashCow indicate that they provide outstanding customer service. It certainly isn’t a bank that is going to be treating its current long-standing savings customers any worse than new customers.

5. Ally Bank – 1.50% Online Savings rate

While Ally occasionally offers some great 11-month No Penalty CD products, the rate on their savings account has trailed their competitors a little bit for the last half a year. That’s OK, because we have every bit of confidence that Ally will always remain among the highest offered savings rates. We also know that they won’t be quietly lowering their savings rates while they give new customers better ones. Their TV advertisements promise as much.

Before opening an online savings or money market account, we also encourage you to check local bank rates and local credit union rates.

Ari Socolow
Ari Socolow: Ari Socolow is the Chief Economist and Editor-in-Chief at BestCashCow. He is particularly interested in issues relating to bank transparency and the climate crisis. Since co-founding BestCashCow in 2005, Ari has been frequently cited in the media as an expert on local and national savings accounts, CD products, mortgage and loan products and credit card rewards products.

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