The Best CD Rates are Found Online
CD rates for the same CD term?
There are a few different ways banks and credit unions offer higher rates for the same CD term. The most prevalent way is offering a higher rate for a deposit of $100,000 or more. Most banks and credit unions refer to these CD accounts as jumbo CD accounts.
Finding the Best CD Rates
Some financial institutions also offer tiered CD accounts. With tiered CD accounts, depositors earn a higher CD rate for amounts lager than $10,000, $25,000 or $50,000. These amounts are not standard amounts, so you will find higher rates with different tiers depending on the bank.
One obscure way that that banks and credit unions offer different rates is by offering separate online rates compared to brick and mortar rates. That's right. If you walk into a bank and open a CD account, there is a chance that the rate you are given will lower than an online rate. Another way that banks offer different rates for the same products is by starting an online division.
For example, BankPurley is a Division of Flushing Bank, based in New York City. Flushing Bank currently has an advertised 12 month CD rate of .15 percent. The bank's online division BankPurley, is currently offering 12 month CD rates at 2.65 percent, a whopping 17.66 times the traditional brick and mortar rate.
Some banks might offer slightly different CD terms between their brick and mortar rates and their online rates. For example, Popular Bank is offering a 13 month promotional CD rate of 2.50 percent. Popular Bank Direct, their online division, is offering a 12 month CD rate of 2.65 percent, a slightly higher rate.
As you can see from these examples, you have to spend some time searching and comparing CD rates. A few minutes searching for rates online from the comfort of your home will get you a higher rate and a better return on your money.