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Online Savings & Money Market Account Rates 2021

Online Savings & Money Market Account Rates

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Money Market Fund Primary Fund (RFIXX) Freezes Redemptions

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

One of the largest money market funds has frozen redemptions for seven days as the net asset value of its shares falls below $1. THIS IS A MONEY MARKET FUND, NOT A MONEY MARKET ACCOUNT. MONEY MARKET FUNDS ARE NOT FDIC INSURED WHILE MONEY MARKET ACCOUNTS ARE.

Marketwatch is reporting that money market fund Primary Fund  (RFIXX) is freezing redemptions for seven days starting Tuesday, September 16.  Its $785 million holding of Lehman Brothers Holdings debt has been valued at zero. As of 4 p.m., the value of the fund's share is 97 cents.  Presumably, investors who have money in the fund will not be able to withdraw it until the freeze has been lifted.  It's unclear what the net asset value will be at that point.  In most cases, the parent company of the fund injects cash or assets to bring the value back to $1 per share. 

We'll share more information as we receive it regarding customer withdrawals.

The Primary Fund is mananged the cryptic sounding The Reserve, a financial company that created the world's first money market fund in 1970. 

Clearly, the bankruptcy of Lehman blow a giant hole in the funds value.  The drop in its NAV shows one of the ways that Lehman's bankruptcy is rippling through the financial world.

It's important to note that The Primary Fund is a money market fund, not an FDIC money market account.  A money market fund can be best thought of as a mutual fund with holdings made up primarily of short-term, high-grade debt obligations and cash-on-hand to ensure liquidity.  Money market funds are not covered by the FDIC.  

E-Loan Savings Plus Offers 3.85% APY

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E-Loan is offering a 3.85% APY Savings account with a deposit of $100,000 and monthly deposits of $100.

E-Loan is offering a boost to their normal savings account with the E-Loan Savings Plus Account.  The account provides a significant boost to their savings rates.  For example:

                                                  Savings Plus             Savings

$100,000 or greater              3.85% APY              3.01% APY

$50,000 - 99,999.99             3.75% APY              3.01% APY

$25,000 - 49,999.99             3.51% APY              3.01% APY

To quality for these boost rates, customers must make regular monthly deposits into their savings account of at least $100. Any Savings Plus account that does not have a minimum of $100 per month deposit for over 60 days will be converted back to a standard savings account and the rates in effect for a standard savings account will apply. Savings Plus is a Money Market Deposit Account that allows up to six withdrawals per month.

These boost rates are competitive compares to some of the top savings and money market rates although there are other accounts that provide a higher return with a much lower deposit minimum and without requiring customers to make regular deposits. 

E-Loan has offered traditionally high CD rates.  E-Loan is owned by Banco Popular North America and has a Bauer rating of 3 out of 5 stars.  As with any bank, we advise you keep your deposit amount under FDIC  limits.

See the best online savings rates here.

Wachovia Offers Online Money Market Rate of 3.5% In Select Areas

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

Wachovia Bank is offering an online-only competitive 3.5% APY money market in some parts of the country.

Wachovia recently joined the high rate fray by offering a top rate on their 2 year CD.  In some locations, they are also offering a 3.5% APY money market account.  The account has a minimum balance of $1,000.  I called to inquire where the offer was avaiable and the CSR was unaware that it was even being offered.  It looks like Wachovia needs to do a better job of communucating to their front line customer service reps.

To find out if you qualify for the offer, go to their savings and CD page.  It will ask you to enter your zip code.  Once you do, you'll either see the offer, or you won't.

This is all part of Wachovia's push to recapitalize itself via its deposit base.  With billions in bad loans outstanding, and billions in floating-rate notes that need to be refinanced, look for Wachovia to continue to offer attractive rates.

There has been some speculation about Wachovia's financial health recently because of mortgage-related losses.  Its stock has fallen from a 52-week high of 81 to around 20 today.  Bauer financial gives it a 3-star rating out of 5.  As with all banks, stay within FDIC limits to be sure your money is fully insured.