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Online Savings & Money Market Account Rates 2019

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Should I Deposit Over FDIC Limits in XYZ Bank?

Having been running BestCashCow for many years now, this is the most common question that I receive.    The question comes from people I know well and people I know casually and people who I don’t know at all.   It comes fast and furious when rates are rising (as they are now) and when the stock market corrects (which it may also be doing now).

This is a question that I do not like to answer in the affirmative.   Anyone who was awake and conscious in 2009 knows that banks can fail hard and quickly.   With the benefit of hindsight, I believe that there will not be another systematic failure of the banking system in our lifetimes, but that another failure like Lehman Brothers could easily happen again.   If we have retained nothing else after 10 years we should remember to always expect the unexpected.

And, when you do that, you realize that the risk in going over FDIC (or NCUA limits) for most people will outstrip the rewards.   Quite simply, there are now many, many competitive online banks with competitive savings rates.   If you consider short-term CDs, you will find more online banks that work for you.    And, by adding local banks and credit unions, you will find even more.   Since it takes only five minutes to open these accounts, the answer that I give to most people is to open another account rather than put your assets at risk.   The risk to get an extra couple of hundred dollars at a higher interest rate simply isn’t worth it.  

As a general rule of thumb, I believe you can find at least 12 accounts to open.   If you cannot find 12, then you should go back and look again and open more accounts.

Here is BestCashCow’s list of the best savings rates.

Here is BestCashCow’s list of the best one-year CD rates.

Therefore, if you have under $3 million as an individual assigned to cash and CDs (or $6 million as a couple), this really is not a question you should be asking me or anyone else.  

I recognize that many of the site’s users have more than that amount, or have particular reasons for wanting to be more concentrated (primarily estate planning issues).   For these users, BestCashCow has significant resources which you can use to judge the viability of any bank, credit union or online bank.

It is also for these users that we highlight programs, such as Massachusetts’ DIF, that may provide addition insurance above FDIC limits.   Ultra high net worth depositors may also want to consider CDARS.

However, for the majority of people, the answer to the question is definitively “no”.


October 2018 Update – Five Online Savings Accounts to Consider as Rates Rise

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

Following the Federal Reserve’s hike in the Fed Funds rate in September, we have seen interest rates of all durations move up in the first week in October.   Savings rates too have risen, causing the best rates in BestCashCow’s table of online rates to shuffle.

Here are 5 accounts you may want to consider:

  1. EBSB Direct – 2.50% savings account on balances over $5,000

EBSB Direct is the online banking division of East Boston Savings Bank and a familiar name to many who have followed the online deposit account space for the last few years.   The 2.50% savings rate is above other nationally available rates and is likely to remain competitive if the Fed raises interest rates again in December.  

EBSB Direct is playing a bit of a game with earlier depositors.  They remain in the “Money Market 3” account earning 1.80% unless they contact customer service and add new money to their account (this is something we don’t like).  On the plus side, EBSB Direct has great customer service according to its reviews on BestCashCow.  The 2.50% rate is good on deposits up to $1 million. While only the first $250,000 is covered by FDIC insurance, East Boston Savings Bank is a Massachusetts-chartered bank and a member of that State’s Depositors Insurance Fund (DIF) that insures balance above FDIC limits.  BestCashCow’s financial analysis shows that the bank is very sound.

Note: EBSB withdrew this offer on November 1, 2018.   It is no longer nationally available to new depositors.

  1. MySavingsDirect – 2.25% Savings Rate, No Minimum Balance

MySavingsDirect is a division of Emigrant Bank.   Emigrant operates three online divisions (MySavingsDirect, Dollar Savings Direct and Emigrant Direct).   Rather than raise the rates in all of the accounts as rates rise, Emigrant has developed a practice of only making their savings rates competitive in one division at a time.   As a result of this practice, customers are being forced to flip accounts in order to maintain market rates (Dollar Savings Direct’s rate seems to be stuck at 1.80% and Emigrant Direct’s rate is 0.50%) and these divisions end up with mixed reviews on BestCashCow (see here how frustrated Dollar Savings Direct customers became when they stopped raising rates).  

Emigrant’s practice is definitely something for new depositors to think about before opening an account.  As rates continue to rise in 2019, you can expect that you will need to move your assets out of MySavingsDirect in order to stay competitive.  That’s an OK strategy so long as you make a plan to check the latest online savings rates on BestCashCow frequently.   Emigrant’s divisions make accounts easy to open and fund (although you cannot link by ACH with all banks).

  1. Marcus – 1.95% Online Savings rate for balances over $1

Marcus has outstanding customer reviews and its lightening fast ACH transfers..  Since Marcus is part of Goldman Sachs, depositors, especially those inclined to deposit over FDIC limits, can always sleep well at night.   Importantly, as rates have risen through 2018, Marcus has proven  to be faster to raise rates than the other most recognized online banks (Amex, Barclays and Ally).  While it may not always sit on top of BestCashCow's online savings table (or those of our competitors), depositors with Marcus can anticipate that they will remain competitive, and know that they will be free from the games that the banks listed above may play.

Note: Marcus's savings rate has been raised to 2.05% at the end of the month.

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

  1. Citizens Access – 2.12% Savings Rate for balances over $5,000

Citizens Access is a recent addition to the online banking space with competitive CD products in addition to their online savings account.  The account is easy to open and it is the online banking division of a solid bank.   They entered the market over the summer of 2018 with a competitive 2.00% savings rate and were quick to raise their savings rate to 2.12% after the Federal Reserve moved in September 2018

Note: Citizens Access raised its online savings rate from 2.12% to 2.25% in the middle of October. 

  1. Purepoint – 2.15% Savings Rate for balances over $10,000

Purepoint is like CitizensAccess with a couple more years under its belt, a slightly higher rate at the moment, but also a higher minimum balance.  They should continue to be competitive and raise rates quickly as the Fed moves through 2018 and 2019.  MUFG Union Bank is Purepoint’s parent, and is itself owned by Mitsubishi UFJ Financial Group, one of the world’s largest banking groups.   Purepoint’s online portal is clearly aiming to attract people depositing millions.   While we strongly encourage depositors to stay within FDIC limits, BestCashCow’s analysis shows that the parent bank is financially sound.

Before opening an online savings or money market account, BestCashCow always urges depositors you to check local bank rates and local credit union rates.


Morgan Stanley is Offering its Customers 2.10% on Savings or 2.40% on a 6-Month CD

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

Morgan Stanley is trying to get its large customer base to move some of their assets back to the bank from other institutions that may have offered better rates in the past.   They are doing this by offering an promotional savings rate of 2.10% or a 6-month CD rate of 2.40% so long as the capital is transferred from outside of Morgan Stanley.   These offers are available under December 7, 2018 and are subject to availability.  Certain conditions may apply.

Customers can deposit up to $2 million per product in each of two issuing subsidiaries – Morgan Stanley Bank, NA and Morgan Stanley Private Bank.   Each is separately FDIC insured.

The 2.10% savings rate is competitive versus online savings rates.    However, according to the terms of the offer, the rate will revert back to the non-promotional rate on March 1, 2019.

As of this publication, the 2.40% 6-month CD rate is above any nationally available online 6-month CD rate.  Locally available 6-month rates may be higher (check rates where you live here).

In the Spring, we suggested that these types of short-term promotional products offered by investment banks may become less attractive after depositors account for the loss of interest while transferring their money in (and presumably out, when the promotion ends).   You may also experience significant periods where your cash is sitting idle at the bank waiting for the bank’s next purchase date.   Read my earlier article here.  (

Additionally, the 6-month CD operates as a brokered CD, as cannot be made liquid with the payment of an early withdrawal penalty like most online CDs can so you better be awfully sure that you won’t need access to your money.  We’ve cautioned against brokered CDs many times (recently here) and you should be especially cautious in a rising interest rate environment like we are entering now.

Bottom line: You might be better off checking the best online savings rates here.