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Online Savings & Money Market Account Rates 2022

Online Savings & Money Market Account Rates

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Washington Mutual Is Rumored to Be for Sale

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

Washington Mutual, a rate leader in the savings and CD space lately, is rumored to be up for sale. The bank has suffered severe losses to its option rate adjustable mortgage portfolio and needs additional capital. It's been offering great rates lately so let's root for it staying independent.

Washington Mutual's online 3.75% APY online savings account as well as some of their CD offers have been highly competitive on BestCashCow over the last couple of months (these rates have since fallen).  The bank has used high rates to attract deposits and help fund itself in the face of billions in writedowns in its option rate adjustable loan portfolio.  The company's stock has sunk to $2 a share from a 52 week high high of $39.25.  The NY Times reports that:

"Its plummeting stock price and the downgrade to junk bond status have also weighed on the bank. And it is paying higher deposit rates than many of its peers to attract customers, Bert Ely, a banking consultant, said."

News is emerging that WaMu is exploring its options and may either sell itself or seek additional capital.  Potential suitors interested in buying the bank include Wells Fargo, JPMorgan Chase, and HSBC.

Another option is to raise more capital.  That now seems more feasible since one of its investors, TPG Capital agreed to fortego an anti-dilution provision that hampered WaMu's efforts to raise additional money.  The anti-dilution agreement would have required a portion of the new capital raised to be paid to TPG Capital, preventing another company from wanting to participate.

From a selfish standpoint I'd like to see WaMu stay independent.  As we saw from Countrywide, once it was purchase by Bank of America, their competitive rates dropped like a rock.  Cash hungry banks are good for depositors, as long as they don't go under.

Money Market Fund Primary Fund (RFIXX) Freezes Redemptions

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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

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

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.