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Online Savings & Money Market Account Rates 2019

Highest Online Bank Rates for Savings And Money Market Accounts - June 24, 2019

Savings Account National Average Rate: 0.22% ?

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Susquehanna Community Bank
2.53% 11.71x $100,000
Western State Bank
2.50% 11.57x $0
2.50% 11.57x $1,000
Northern Bank Direct
2.50% 11.57x $5,000
Comenity Direct
2.48% 11.48x $100
Banesco USA
2.47% 11.44x $100, a division of Silvergate Bank
2.46% 11.39x $10,000
BMO Harris Bank National Association
2.45% 11.34x $5,000
UFB Direct, a division of Bofi Federal Bank
2.45% 11.34x $25,000
My Savings Direct, a division of Emigrant Bank
2.40% 11.11x $1
Rising Bank, a Division of Midwest BankCentre
2.40% 11.11x $1,000
Transportation Alliance Bank, Inc. d/b/a TAB Bank
2.40% 11.11x $2,500
CIT Bank
2.40% 11.11x $25,000
Quontic Bank
2.40% 11.11x $100,000
2.39% 11.06x $0
New money only.
Rate available for new accounts only.
Citizens Access
2.35% 10.88x $5,000
Purepoint MUFG Union
2.35% 10.88x $10,000
Sallie Mae Bank
2.30% 10.65x $0
Live Oak Banking Company
2.30% 10.65x $0
Promotional rate for new depositors only. Prior depositors may receive a lower rate.
Northpointe Bank
2.30% 10.65x $25,000
SFGI Direct, a division of Summit Community Bank
2.27% 10.51x $0
Northfield Bank
2.25% 10.42x $0
Marcus: By Goldman Sachs
2.25% 10.42x $1
Synchrony Bank
2.25% 10.42x $1
Promotional rate for new account holders only.
New account holders only.
Customers Bank
2.25% 10.42x $25,000
Amboy Direct
2.25% 10.42x $30,000
BAC Florida
2.25% 10.42x $100,000
Barclays Bank Delaware
2.20% 10.19x $0
Ally Bank
2.20% 10.19x $0
FNBO Direct
2.20% 10.19x $1
Incredible Bank, a division of River Valley Bank
2.20% 10.19x $25,000
Peoples Bank (Mississippi)
2.15% 9.95x $10,000
TIAA Bank / Everbank
2.15% 9.95x $100,000
Discover Bank
2.10% 9.72x $0
2.10% 9.72x $5
Bank5 Connect
2.05% 9.49x $10
Radius Bank
2.05% 9.49x $25,000
Ridgewood Savings Bank
2.00% 9.26x $0
Colorado Federal Savings Bank
2.00% 9.26x $1
Mutual of Omaha Bank
2.00% 9.26x $1,000
Capital One 360
2.00% 9.26x $10,000
2.00% 9.26x $100,000
BankPurely, a division of Flushing Bank
1.90% 8.80x $0
Clear Sky Accounts
1.85% 8.56x $1
ableBanking, a division of Northeast Bank
1.85% 8.56x $1,000
My Banking Direct, a division of New York Community Bank
1.85% 8.56x $25,000
Cross River Bank
1.82% 8.43x $0
Dollar Savings Direct, a division of Emigrant Bank
1.80% 8.33x $0
Heritage Bank National Association
1.76% 8.15x $230
Heritage Bank National Association
1.66% 7.69x $100
Zions Bank
1.26% 5.83x $1,000
Axos Bank, a division of Bofi Federal Bank
1.05% 4.86x $0
BMO Harris Bank National Association
1.00% 4.63x $25,000
Charles Schwab Bank
0.50% 2.31x $0
OneWest Bank, a division of CIT Bank
0.40% 1.85x $100,000
New Dominion Direct
0.40% 1.85x $100,000
CNB Bank Direct
0.26% 1.20x $100
AirBanking, A Division of MainStreet Bank
0.25% 1.16x $1,000
Kirkpatrick Bank
0.15% 0.69x $1
Dime Community Bank
0.05% 0.23x $0
All rates listed are Annual Percentage Yield (APY). The APY rate in a savings account or money market account is a variable rate that is subject to change at any point. The Min listed is the minimum deposit account balance required to obtain the rate listed.

Why You Can Trust BestCashCow

Every year, Americans collectively lose at least $80 billion in income just by putting their savings in the wrong bank accounts. BestCashCow is the most comprehensive and unbiased bank rate site on the Internet and our mission is to help you to avoid your share of these losses. We monitor over 30,000 rates from over 8,000 FDIC-insured banks and 7,700 NCUA-insured credit unions. Take a few minutes to explore the table above to see the best savings rates currently offered by online banks, or use the tabs to explore local bank rates or local credit union rates if your prefer to do your banking locally.

By using BestCashCow to move your money to a new bank from one with a low savings rate you may be able to boost your annual interest earned from savings by more than 10X. Banks are always competing for your money. Take advantage of it!

You can learn more about BestCashCow here.

Expert Reviews of Well-Known Online Banks, June 2019

Marcus logo
Online Savings - 2.25% APY, $1 minimum

Great for: High Savings and No Penalty CD Rates with no transaction fees ever.

Overview: Marcus is the online bank of Goldman Sachs. Throughout 2018, it consistently offered one of the highest online savings rates, earning it recognition as a BestCashCow 2019 Best Bet.

Highlights: Marcus is very highly rated in customer reviews on BestCashCow. Users cite the consistently high savings rates, lightening fast ACH transfers, the ease of web access, strong customer service and the absence of any fees ever.

What to watch for: Marcus does not yet have a mobile app.

Citizens Access logo
Online Savings – 2.35% APY, $5,000 minimum

Great For: High Savings and No Penalty CD Rates with no transaction fees ever

Overview: Citizens Access is a relatively new entrant in the online banking space, but is a subsidiary of Citizens Bank, one the largest, oldest and most well established US banking institutions.

Highlights: Citizens Access never charges any monthly fees. Its user reviews on BestCashCow have been outstanding. Its consistent rate increases at or in anticipation of each Federal Reserve action in 2018 has earned it a spot as one of BestCashCow’s Best Bets for 2019.

What to watch for: All Citizens Access savings and CD products require a $5,000 minimum balance.

Ally logo
Online Savings Account –2.20% APY, no minimum

Great For: Consistently Competitive savings and No Penalty CD rates with 24/7 Customer Service

Overview: Ally’s strong advertising campaigns and name recognition has made it one of the most recognized online banks. The savings rate is consistently competitive, and the bank also offers competitive CD products (with modest early withdrawal penalties) and no penalty CDs (with no early withdrawal penalties).

Highlights: BestCashCow user reviews cite a strong mobile app, great customer support, and the ease of getting into and out of No Penalty CD products. Ally also recently offered new and existing users a 1% cash promotion for bringing new deposits.

What to watch for: Some users have expressed disappointment with long wait times in reaching customer service by phone during peak hours. Others have commented about being disappointed by Ally's aggressive cross-selling of auto loan, personal loan, credit card and online trading products.

CIT logo
Savings Builder – 2.40% APY, $25,000 Minimum or monthly deposit of $100

Great For: Consistently Competitive rate

Overview: CIT Bank is a nationwide direct bank and is a division of CIT Bank, N.A. The bank was an early entrant into the online banking space, and has been offering competitive savings and CD products to US customers through the internet for many years. Due to the competitive positioning of its Savings Builder Account, we have rated CIT Bank as a BestCashCow 2019 Best Bet.

Highlights: User reviews left on BestCashCow’s savings table are consistently strong with users highlighting strong and responsive customer service by phone when necessary.

What to watch for: The Savings Builder account requires a $25,000 balance or a $100 deposit with at least $100 in subsequent monthly deposits.

Synchrony logo
High Yield Savings – 2.25% APY, no minimum

Great For: Consistently Competitive rate and 24/7 Access to Customer Support

Overview: Synchrony Bank is the former GE Capital Retail Bank that has now been spun off completely into its own institution, and has offered very competitive online savings and CD rates for some time. As Synchrony is an entirely independent entity now, BestCashCow does not believe that Synchrony has exposure to GE’s problems .

Highlights: User reviews left on BestCashCow cite strong and consistently available customer service.

What to watch for: Synchrony is no longer as one of the most rate competitive online banks. Some customers have noted that the early withdrawal penalties for some of its special CDs are onerous.

Barclays logo
Savings Account - 2.20% APY, no minimum

Good for: Solid APY with No Minimum Balance

Overview: Barclays Bank Delaware is a division of the often-troubled UK-based Barclays PLC. In the US, its brand recognition emanates from its role as one of the credit card issuers for American Airlines. The US subsidiary does not have a branch network and the absence of those cots enable it to pass along competitive savings and CD rates to its customers.

Highlights: Barclays offers no minimum to open, 24/7 access to funds, online transfers to and from other banks, direct deposit and a mobile app.

What to watch for: Barclays Bank Delaware has not been consistently competitive in raising its savings rates as the Federal Reserve increased rates over the last several years. While it used to be a very strongly reviewed bank by BestCashCow’s users, more recent reviews cite slower ACH transfers than some competitors. With uncertainty around Brexit, BestCashCow strongly recommends that depositors at this U.S. subsidiary maintain deposits within FDIC limits.

Product Information For High Interest Online Savings Accounts

How Do Online Savings Accounts Work

Over the last two decades, online banks have emerged to offer depositors higher rates on their online savings and money market accounts than are available in the major money center banks and in smaller brick-and-mortar banks. Since these online banks do not have expensive branch networks to maintain, they usually pass some of their savings back to depositors in the form of higher rates. All online banks and local banks listed on BestCashCow are FDIC Insured.

Unlike certificates of deposit (CDs) or time deposits, money in savings and money market accounts accrue interest on a daily rate. The best yielding savings rates can conceivably change from day-to-day with new online banks emerging or existing banks more aggressively seeking to raise the capital accounts. It is important to check back on BestCashCow regularly to be sure that your savings accounts continue to earn the most competitive rates, no matter what the rate environment is.

The table above lists the highest yielding online savings account rates.

Recent Performance of Online Savings And Money Market Accounts

BestCashCow data shows that the highest yielding online savings account and money market rates increased through 2017 and 2018. Rates have stabilized with the best rates well above 2.00% in mid-2019, and the next move in the Fed Funds rate as set by the Federal Reserve is uncertain.

The average online savings or money market rate exceeds the national average rate quite dramatically. The graph below shows how the average rates for online savings and money market accounts have trended over the last several years.  Even while online savings rates have improved, the the average rate of all online and locally offered savings accounts in the BestCashCow rate database has increased more slowly and now sits at 0.22%. (The BestCashCow rate database, the largest in the US, contains rates on over 2,000,000 bank products from all 8,000 banks and 7,700 credit unions in the US.)

Best High Yield Savings or Money Market Accounts

Depending on where you live, there may be banks and credit unions offering rates still higher than the best online savings rates. Check BestCashCow’s list of the highest yielding local bank rates and the highest yielding credit union rates.

Best Online Bank Accounts with High Interest Rates

In the above table, you will find a list of the highest online savings account rates, ranked in descending order by interest rate currently offered. Online bank accounts are slightly different in terms of their features and the services offered. By reading the reviews of each bank, accessible from the rightmost column, you will be able to determine which bank is the best for you. Please also refer to the section below entitled “Best Online Savings Account Rates".

Are Online Savings Accounts Safe?

All bank accounts listed on BestCashCow are insured by the Federal Deposit Insurance Corporation ("FDIC"). The FDIC is a federal government chartered institution that provides insurance to a maximum amount of $250,000 per individual per institution (or $500,000 for joint account holders). All deposits (CDs, Checking, Savings Accounts) held in the same type of ownership at a single financial institution are only insured to $250,000. However, funds held in different types of ownership (Individual, Joint, Trust, Retirement) may fall under separate FDIC insurance provisions. strongly recommends that you deposit savings in only FDIC insured institutions and that you do not exceed FDIC coverage limits. Please visit the FDIC's website to determine your coverage limits based on your circumstances.

Advantages of Online Savings Accounts:

  • Higher interest rate.
  • Often top notch online functionality with 24/7 access, 365 days a year. You can check your balance, update your contact info, make transfers, and order deposit slips at any time. For more pressing issues, customer support is also usually accessible 24/7, so you can talk to an actual human instead of your computer screen.
  • Superior online and mobile access. Many traditional banks have been slow to adopt the best web and mobile features to improve the customer experience online. 
  • Easy money transfer capabilities to and from a primary checking account.
  • Liquidity. Depositors can withdraw their money at any time.

Disadvantages of Online Only Banks:

  • A variable interest rate. While most leading online banks have not lowered rates significantly in past years, any savings rate can conceivably be lowered at any time.
  • There are often new entrants to the market that can disappear as quickly as they arrive on the scene.
  • Interaction is only via phone or Internet. You cannot walk into a branch and talk to a customer service representative if you have a problem with your savings account. Nonetheless, the leading, high profile online banks provide virtually instant phone access at all hours to a representative. However, interaction with some of the smaller online banks can be more difficult as it is ordinarily limited to business hours in their area of operation.
  • You cannot get cash or cashier's checks instantly as you can in a branch bank, and matters where you need to rely on the US Postal system can lead to significant delays and obstacles.
  • There is no opportunity to build a relationship with a banker should you need a loan or additional services in the future.

What is the best account for easy access?

Depending on where you live and how accessible the branch is, you may find that the best account for easy access is through a local bank or credit union. However, today many high yielding savings and money market accounts provide such easy accessibility, including through mobile apps, and can enable such easy transfers to a correspondent account at a local bank through ACH transfers, that more and more people are opening accounts for cash and savings that they do not need immediately.

Is a high-yielding online savings account your best option?

High-interest savings accounts are always an ideal place to keep your emergency fund or any money to which still you need ready access. Your money will be safer than if you stuffed it under your mattress, and it will grow a bit, too. Investors will find that keeping large amounts of money in savings and CDs provides them with lower returns but cushions them against market crashes like we experienced in 2000 and 2001 and again in 2008 and 2009.

Compare Online Savings Accounts

Savings Rates at Most Recognized Online Banks

To see how savings and money market accounts compare with CDs or time deposits and bonds, view the BestCashCow income guide here.

Frequently Asked Questions About Online Savings Accounts

What is a savings account?

A savings account is one of the simplest types of bank accounts. It allows you to store cash securely and earn interest on your money.

What is a money market account?

The differences between a savings account and a money market account are largely arcane. Some savings accounts are limited by US federal regulations to six outbound transfers per month (the bank may allow additional access for a fee). Money market accounts are technically not bound by those limitations and offer more ways to access deposits by issuing checks and debit cards. Prudent consumers will compare the two interchangeably, focusing primarily on rates and service among FDIC-insured banks (or NCUA-insured, for credit unions). Consumers who maximize their use of online savings and money market accounts access these accounts through ACH transfers that are easily set up on the online bank’s website so the additional ways to access deposits that money market accounts offer are rarely valuable.

How to Open a Savings Account?

The process of opening an online savings account or money market account is usually very simple. Banks ordinary ask you a few questions to verify your identify. These questions include seeking information from a state or government issued ID, such as a driver’s license. Due to increased US anti-money laundering rules and Department of Homeland Security requirements, it is very likely that you will also be asked to produce a photocopy of your license and a picture taken from your iPhone or other smartphone and emailed to the bank will ordinarily suffice. The bank may ask for information regarding a correspondent account from which you intend to have them draw the money to provide the initial funding. You therefore will need the ABA number and account number from an existing account that you have. They will verify this account by having you log back in to confirm the amounts of one or two small deposits to your correspondent account before they draw the funds from this account. Finally, many banks do a “soft” credit pull from Experian, Equifax or some other credit rating agency. While your credit rating will ordinarily not be affected, the application process may involve your answering questions about where you have lived, loans you may have had, past employers or cars you may have owned. Many people do not enjoy providing the amount of personal information required over the internet; therefore, some of the larger online banks have 24-7 customer service to guide you through the process. You can see the experiences of others with a given online savings bank that you are considering by reviewing the comments left in BestCashCow’s table above.

Are online savings rates always better than rates at brick-and-mortar banks?

No. Online banks often offer higher savings and CD rates because they have lower expenses by not having to maintain brick-and-mortar locations. You should also check rates at local banks and credit unions. Unlike other websites, compiles all of these rates, listing them in an unbiased manner that shows the proximity of each bank or credit union to you. Please access these rates using the tabs above.

Why do savings rates vary so much?

Even though rates are at levels that are historically very low, there is competition for your money. Like any active marketplace, there are buyers and sellers of goods and services at different prices.

How do I choose the right savings or money market account?

Begin your search with the table here on In addition to checking online savings rates, you should also check local bank rates and local credit union rates.

What is the Best Fixed Rate Savings Account?

BestCashCow strongly encourages people to avoid very short-term promotional rates. The very nature of a savings or money market account is that the rate can change from one day to the next. Savings rates may be guaranteed not to change for some very short length of time, but they are not fixed. If you require a fixed rate or greater certainty that the rate that you are making will not change, you should consider CDs, which represent a time deposit, for some or all of your savings.

Should I consider CDs?

If you are unlikely to require access to your cash for some time, you may also consider certificates of deposit (CDs). While CDs have penalties for early withdrawal that may even eat into your principal, the rates on 2, 3, 4 and 5 year CDs are ordinarily significantly higher than savings rates. CDs also offer the certainty of rate stability for the term of the CD. Several sections and articles on BestCashCow can also help you to identify your proper cash allocation between savings and CDs.

With savings rates at such low levels, does earning a higher savings rate or the best savings rate really mean anything to me?

Even a difference of a couple of basis points (hundredths of percentage points) can really add up over time, especially on large sums of money. You may wish to familiarize yourself with the BestCashCow Savings Calculator in order to understand the importance of compounding interest at higher rates on your savings over time.

If you have not accessed the BestCashCow Savings Calculator or mastered the magic of compounded earnings, here is the plain and simple truth:
  • $250,000 deposited at a major money center bank like Chase, Citibank, Bank of America or Wells Fargo is likely earning less than 0.10% APY. That money is therefore making no more than $250 a year in interest.
  • That same $250,000 deposited at a leading online bank is earning over 1% or over $2,500.
  • Even though the increased earnings from high yield savings (in this example, $2,250 annually) is fully taxable at the federal and state and local levels, wouldn’t you like to be earning that extra income from high-yielding savings accounts?

What does APY mean?

“APY” stands for annual percentage yield. Savings rates are displayed in terms of APY to indicate the effective annual-interest return, including the compounding of interest, over the course of a single year. $100,000 deposited in a savings or CD account with a 1.20% APY will earn $1,200 in the course of the year, but monthly interest in the first few months may be less than $100 a month (this also depends on the number of days in the month). Hence, the APY rate is ordinarily a couple of basis points above the real interest rates. Unlike with a CD, your actual APY in a savings account or money market account may vary if the rate changes.

Are you still hesitant to open a high interest-earning online savings account?

Here are some common reasons people hold off:
  • You need to make more than six withdrawals a month. Avoid potential problems by opening a high earning online money market account (some of the best rates available in the table above are actually from online money market accounts), opening a savings account at a bank which does not enforce the 6 transfer limit, tying your account to a correspondent bank’s money market account or checking account at a major money center bank (like Chase, Citibank, Wells Fargo, or Bank of America) where you make one larger transfer each month.
  • You like having access to a physical branch. Find out what the minimum balance required to avoid fees on your account at your physical branch, then transfer the excess balances to a high yielding online savings or money market account. You’ll continue to have access to the physical interaction and services of the bank with which you are used to banking, but you will also be dramatically increasing the interest earned on cash you don’t need over time.
  • You need to deposit large sums of cash or checks in excess of the online bank’s mobile deposit limit. In this case, you need access to a physical branch. See point 2, above.
  • You want one institution to handle all of your financial matters. Most online banks do not offer mortgages, credit cards and brokerage services. There is no financial advantage to keeping all of your financial transactions in one or even a handful of institutions.

What is a health savings account?

A health savings account (or HSA) is a tax advantaged medical savings account available to taxpayers in the United States who are enrolled in a high-deductible health plan (HDHP). The funds contributed to this kind of account are not subject to federal income tax at the time of deposit. According to IRS Publication 969 (2016), the interest or other earnings on the assets in the account are tax free and distributions may be tax free if you pay qualified medical expenses or other expenses not covered by health insurance such as dental or vision care. Due to the tax advantages of a health savings account, these accounts should be set up separately through banks offering them (such as Chase or Bank of America) and their assets should not be comingled with a high yielding online savings account. We know of no online banks currently offering HSAs.

What is an education savings account?

Education savings accounts, such as Coverdell Education savings accounts and 529 plans, are accounts that allow family members to obtain certain tax advantages through setting aside funds for a child’s future education. 529 programs are administered at the state level and you must invest in programs they administer; Coverdell education savings accounts are move flexible (and generally follow the same rules as IRAs), however we know of no online banks currently offering Coverdell Education savings accounts.

What is a child savings account?

A child savings account is a savings account in the name of the child with a parent or guardian named as the custodian on the account until the child reaches the age of 18 or 21 (depending of the child’s state of residency). A child savings account can be a great way to teach your child the importance of saving money from a young age. More information on child savings accounts can be found here. Ally and Capital One 360 are among the few online banks offering child savings accounts.

Best Online Savings Account Rates

Finding the best high interest online savings or money market account is a highly subjective exercise. The best account for your neighbor may not be the best account for you. To help you determine which account is best for you, we have created the following 7 point checklist:
  • A competitive interest rate. BestCashCow maintains the most comprehensive list of deposit account rates. The rates above are the best available rates for online savings accounts. In order to ensure that your money continues to grow over time, you may wish to avoid banks which rely heavily on very short term promotional rates (such as EverBank). If you open an account with a promotional rate or even if you open an account where the rate isn’t promotional in nature, you should check back with BestCashCow regularly to be sure that your bank continues to offer one of the most competitive rates.
  • Full functionality through online and mobile access. Most of the accounts listed above have robust websites and mobile access that enables full functionality. Read the comments from other users before opening an account as they often highlight problems with access.
  • Assess how the bank provides customer service.. Many of the leading online banks now have customer service representatives who are U.S. based and available 24/7 with low wait times. This is often a distinguishing feature that makes a well-recognized bank significantly more attractive than a smaller bank trying to enter the online banking arena.
  • Absence of fees. Be sure that you are opening an online account with a bank that doesn’t charge fees and has very low minimum balance requirements. American Express, CIT, GS Bank, Barclays and Ally are all well known for low minimum requirements and the absence of any unusual monthly fees.
  • Easy Access to your Cash through Immediate Online Transfers. The reason why you keep money in savings is for access in an emergency or to take advantage of immediate financial opportunities. You need access to your cash. Yet, some banks impose strict limits on the amount of cash that you can access from your account in a single transfer or limit the numbers of transfers you can conduct over a given time period. Other banks can delay your transfers for days while they make money on the float. You should check with the bank where you are considering opening an online account to understand the restrictions before you open an account. You may also read the comments from other users above as they can highlight which banks enable the best access to your cash.
  • Stay within FDIC limits! See the section above and read this article.
  • Use the BestCashCow Savings Calculator to see how important it is to be maximizing your interest on savings accounts over time.


Find out how much extra money you can earn by moving your bank money into an account that pays more.

Use or Change these Amounts And Rates

Recent Articles

The Fed Funds Rate is Unchanged at 2.25 to 2.50%; Savings And CD Rates Likely to Firm

The Federal Reserve concluded its 2-day June meeting leaving the Fed Funds rate unchanged.    As it tries to remain independent of an unrestrained Executive branch that is compaigning for sharp cuts, it removed the word “patient” from its rate outlook.   While the Fed has not committed to a July cut, eight members polled indicated that the next move will be down while one indicated that it may be up.

Online savings rates continue to be attractive and will likely firm in the wake of the Fed’s decision today.   One-year CD rates offer a nice premium over the best savings rate and could be a good place to put much of the money that you may want to keep out of other assets and do not expect to need to access over the next 12 months.

June 2019 Savings And CD Update – How Can You Protect Your Interest Rate on Cash?

Rate information contained on this page may have changed. Please find latest savings rates.

We pointed out in our May (hyperlink) and April updates, that the Fed may be on hold for a while.   We also suggested that May could be a good time to sell and go away.   As we enter June, it looks more and more likely that the economy is heading for uncertain times as a result of unnecessary trade wars with China, Mexico and perhaps others initiated by our autocratic president.

I have highlighted No Penalty CDs in the recent past.   As we crossed through May, these became more and more attractive by the day.   These products offer the advantage of a higher interest rate and the certainty that the rate will be applied for about a year.  At the same time, No Penalty CDs give you the flexibility to access your money without penalty after 10 days should you need the money or should rates rise (which is still a distinct possibility if inflation is an outcome of these trade wars).   One disadvantage is that you ordinarily cannot make partial withdrawals, although you can always terminate the CD and reinitiate it provided rates do not fall.

As a result of their flexibility in this uncertain period, No Penalty CDs comprise recommendations 1, 2 and 3 for June.

  1. Purepoint – 13-Month No Penalty CD, 2.50%, $10,000 Minimum

Although Purepoint’s rate has fallen by 10 basis points since being initiated earlier this year, even at 2.50%, Purepoint’s No Penalty CD rate matches that of the best online savings account.  

  1. Marcus – 13-Month No Penalty CD, 2.35%, $500 Minimum

Marcus’s product can be easily set up online, has a lower minimum balance requirement than the others and can be terminated in seven days.

  1. Ally – 11-Month No Penalty CD, 2.30%, $25,000 Minimum

Ally’s No Penalty rate is not as competitive as Purepoint’s or Marcus’s, it minimum balance requirement is higher and its term is only 11-months (a longer term is actually better as it provides more protection should rates fall).  Yet, Ally makes the list because they have been offering this product for years, and it is super easy to terminate the CD and initiate a new one online should rates rise, should you require a partial withdrawal, or should you wish to extend the end date.

Check out other No Penalty and Special Term CD rates here

The market for savings and money market products – particularly in the online space – continues to be very competitive and rates have not fallen very much as a result of increased economic uncertainty and the fall in long-term rates.  They have not fallen yet.   Savings rates are not guaranteed and could change from day-to-day.   One strategy to protect your interest rate is to look for new entrants in the online space that are spending a fair amount to gain deposits and are therefore unlikely to slash their rates for some time.

Two new entrants in May that have caught our attention are:

  1. Susquehanna Community Bank, 2.53%, $100,000 Minimum
  2. BMO Harris Bank, 2.45%, $5,000

While the rates are good, some of these new entrants are so untested that there is some risk to this strategy, and you may wish to wait to see the comments on BestCashCow about some of these banks before opening an account.

See and compare all of the best online savings rates here.

Have a great month.

Absolutely Impossible to Predict the Direction of Short-Term Interest Rates Now

The two most common questions that we get at BestCashCow are “which direction are interest rates going?” and “how do I position myself now if the Fed raises or lowers?”

The answer to the first question drives the second.  

Never in the 14 years since this site was founded has it been so difficult to determine the direction of interest rates.

On the one hand, it is unprecedented to have an Administration that knows no legal, ethical, moral or other boundaries and which will stop at nothing to win re-election in 18 months.     Trump himself, Kudlow and others will continue to direct unprecedented lobs at the Federal Reserve and Jerome Powell, its Chairman, in order to persuade them to lower rates between now and November 3, 2020.

Powell already changed the Fed’s guidance in November 2018 as a result of Presidential harassment, leading Wall Street analysts to predict that the next Fed move is to lower the Fed Funds rate from its current range of 2.25% to 2.50%.

But, Powell’s original position was that the Fed needs to bring the rate to a neutral position around 2.85% and he has recently used the absence of inflation as his grounds for stalling here.   It is highly likely that any prolongation of a tariffs war with China will cause inflation, perhaps even strong inflation if there is also a rise in the price of underlying commodities.   Therefore, I think it is impossible to count out the possibility of at least one Fed raise before the end of 2019.

I therefore continue to advise people to keep most of their money in savings and money market accounts and no penalty CDs.   However, one-year CDs that offer rates at or above 2.80% and have early withdrawal penalties of only 3-months or less are available online and locally, and I think that they may make sense for some of the money that you know you will not need during that period.   I would avoid longer-term CDs for the moment as they are not offering a significant premium over shorter term CDs.

See our latest monthly update for more information on some of the best products currently available.

Uber and Lyft Are At Least 7x to 10x Overvalued

I am watching Bloomberg and CNBC this morning as Uber prepares to come public.   The discussion among analysts is on whether Uber and Lyft should be trading at 4 times sales or 6 times sales.   Lyft is a pure play US taxi service.   Uber is more international, and plays in a whole series of other industries, including transport and food delivery.   Lyft’s top line is growing much faster.   Hence, presumably one merits a premium over the other.

The discussion strikes me as patently absurd.

To be clear, the last time that analysts suddenly switched from trying to rationalize equity pricing at multiples of sales was, umm, March 2000.   The argument was made that internet stocks could create such efficiencies that a top line multiple could be applied.   But, those companies had wide margins at the time.   Uber and Lyft today are operating at margins of around 20% that are continuing to compress.

These types of valuations that are being applied to Lyft and Uber are predicated on robotaxis replacing cars that require a driver in the immediate future and on automation leading to wider margins.

Now, I am a big believer in the future of automated driving, but I don’t see that necessarily expanding the margins of either Uber or Lyft operating fleets of driverless cars in 2020.  Even Uber CEO, Dara Khosrawshahi, says it will be “quite a few years” beyond 2020.

When the industry becomes completely automated (whether that happens in 3 years, 5 years or 10 years) and Uber and Lyft are operating fleets of driverless cars, their margins will not be expanding at the rate that would justify a sales multiple of four or six times sales today.   Rather, the margins will continue to compress as the market for robotaxis will be perfectly competitive (as will the market in every other industry in which Uber participates). 

So, I believe that even under the most realistic and optimistic circumstances, a fair valuation for companies operating in this industry would target a PE of about 10x in 5 years or a price to sales of about 0.4x to 0.6x.   That would make both of these companies overvalued by 7 to 10x.   And, I intend to invest in both of these companies when they trade at those valuations.

May 2019 Update – The Fed May Be On Hold for a While

Rate information contained on this page may have changed. Please find latest savings rates.

The Federal Reserve concluded its 2 days meeting yesterday and acted unanimously to hold the Fed Funds target rate to 2.25% to 2.50%.   Guidance continues to be for no more rate changes in 2019, as the Fed previously indicated in its March meeting.   Although the Fed statement expressed concern about inflation falling below target, Jerome Powell resisted questions indicating that it might create the basis for lowering rates later in the year. While Powell has already compromised Fed policy by bowing to Presidential harassment in November, he now seems to be resisting calls by the President and Larry Kudlow and other pretend economists to lower the Fed Funds rate.


Against this backdrop, we think short-term CDs now look pretty attractive.  While many banks have lowered their 1-year CD rates to levels that are no longer competitive (Synchrony, Sallie Mae Bank and others), you can still find rates at or above 2.80%.    We think you are unlikely to lose much or any interest by locking in money that you wont need at that rate, especially as interest rates would need be raised twice by 25 basis points for savings rates to achieve that level.  You should, nonetheless, only invest in products that have early withdrawal penalties of three months interest or less.

Two one-year CD products that we like here are:

  1. Citizens Access – 1-Year CD, 2.85%, $5,000 Minimum

CitizensAccess has gotten positive reviews on BestCashCow since launching in 2018.   Their accounts are by-and-large easy to open and manage online and the penalty for early withdrawal is only 3 months’ interest.

You can learn more about CitizensAccess here

  1. Live Oak Bank – 1-Year CD, 2.80%, $2,500 Minimum

Live Oak is a tiny little NC-bank, but their website is well-developed, and their 1-year CD rate is still competitive (although it was lowered from 2.85% in March).   Their penalty for early withdrawal is also only 3 months’ interest.

You can learn more about Live Oak Bank here.

See all 1-year CD rates here.


In addition, we recently wrote about the increased attractiveness of No-Penalty CDs, and you can read that article here.

  1. Purepoint – 13-Month No Penalty CD, 2.50%, $10,000 Minimum

Since we wrote that article, Purepoint’s rate has fallen by 10 basis points (from 2.60% to 2.50%).   However, even at 2.50%, Purepoint’s No Penalty CD rate matches that of the best online savings account.   Since you can access a No Penalty CD at any point after the first few days, they just do not have the liquidity risk of long-term CDs.  

Check out other No Penalty and Special Term CD rates here


In our April update, we cited My Savings Direct and CIBC as two online savings rates that are very competitive (offering 2.40% and 2.39% APY, respectively) with no or very low minimum balance requirements.   While savings rates are not guaranteed and could change from day-to-day, these two have remained competitive and are well worth a look.

See and compare all of the best online savings rates here.

Have a great month.

Sell In May And Go Away?

We have all heard the old stock market adage: “Sell in May and Go Away.”   But, anyone who has followed the market for the last few decades knows that the adage only held true in 1999 and 2008.   Even if you had sold in May 1987, you would have missed a tremendous run into October of that year.

But, this year there are too many telling signs to discard the adage.   The stock market is up over 16% since its Christmas Eve 2018 low (the S&P has moved from 2350 to 2900), for its best four-month start to the year in over 3 decades.   All indices appear poised to eclipse all time highs.   But, it isn’t just the pace and the intensity of the move up.   Valuations are entirely out of whack in some favored sectors.  For example, casual service restaurant stocks like Starbucks and McDonalds are trading at PE ratios over 25x and PEG ratios over 2x.   Some REITs are trading at similar valuations, regardless of asset quality.   And, then in the wake of the Lyft, Pinterest and Zoom IPOs, people are no longer speaking about PE and PEG ratios, but instead trying to rationale 15 + Sales – to – Earnings ratios (remember 1999 anyone?).

To boot, there is still so much that can go wrong.   While we have heard about the UK and the possibility of a hard Brexit catastrophe for 2 years, the risk is still sitting out there for the second half of 2019 (the new deadline is October 31).   Likewise, in the US, over the same period, we’ve worried about an egomaniac in the oval office who appears increasingly irrational and unhinged, and while the economic risks associated with the underlying situation have not materialized, the risks to the market remain.   We also seem to have North Korea brewing again.

As the Wall Street Journal pointed out this past weekend, many institutional investors are wondering whether to lock in their gains for the year and go away.

Longer-term investors, unlike many institutional investors, face the risk of being forced back into a market that is still higher at a later date.   They also may face significant capital gains taxes.   Its hard to sell out of a rising market, but it just might be a pretty prescient move to raise cash now.

See the best savings rates here.