Best Savings Rates/Money Market Rates August 12, 2013

Bond yields and mortgage rates have risen over the past several months while savings rates and money market rates remain stuck at low levels. Rates fell to record lows after the financial crisis and recession over 6 years ago and will stay low because the Federal Reserve is suppressing rates to spur growth.

The Federal Reserve's policy of keeping rates artificially low will stay in place for at least another year and possibly longer. The Fed has stated they plan to keep their key interest rate, the federal funds rate, in a targeted range of zero percent to one quarter percent. The fed funds rate will stay at this level until the nation's unemployment rate falls below 6.5 percent.

Savings Rates and Money Market Rates Tied to Unemployment Rate

The current unemployment rate is at 7.4 percent and the Fed expects the rate to fall below 6.5 percent sometime in mid 2015. Unless the unemployment rate falls below 6.5 percent before the mid 2015 projection, that means savings and money market rates will remain at current levels for at least another two years.

While the Fed's policy has helped the nation recover from the worst economic downturn since the Great Depression, the Fed's policies have hurt holders of interest-bearing assets. Millions of people who supplemented their income with interest earnings from savings accounts and certificates of deposit have earned much less, courtesy of the Fed.

Average and Best Savings Rates August 12, 2013

This week the average savings rates on account balances of $10k or more reported by MonitorBankRates are averaging 0.47 percent. The average savings rate reported by MonitorBankRates is much higher than the FDIC average rate this week which is at 0.06 percent. We also list rates in our database which are higher than the averages reported by us and many times the FDIC average.

The best savings rates right now in our database are more than 15 times the FDIC average. The best savings rate for August 12, 2013, is from The Palladian PrivateBank at 1.00 percent with an APY of 1.00 percent. The second highest savings rate in our database is from Barclays Bank at 0.90 percent with an APY of 0.90 percent.

Current Top Savings Rates

1. The Palladian PrivateBank 1.00%
2. Barclays Bank 0.90%
3. FNBO Direct 0.85%
4. Colorado FSB 0.85%
5. Ally Bank 0.84%
6. Discover Bank 0.80%
7. Heartland Bank Direct 0.70%
8. Bank of Internet USA 0.61%
9. First Internet Bank of Indiana 0.60%
10. Lone Star Bank 0.50%

Average and Best Money Market Rates August 12, 2013

Average money market rates on account balances of $50k or more reported by MonitorBankRates.com are currently at 0.65 percent. The average money market rate in the FDIC's national rate and rates cap survey this week are at a measly 0.09 percent. As with savings rates, the best money market rates in our database are many times the FDIC average.

The highest money market rate this week in our database is from Sallie Mae Bank at 0.90 percent. Sallie Mae Bank's rate is ten times the FDIC average this week. The second highest money market rate in our database is from EverBank at 0.86 percent APY.

Current Top Money Market Rates

1. Sallie Mae Bank 0.90%
2. EverBank 0.86%
3. Mutual of Omaha Bank 0.85%
4. Ally Bank 0.84%
5. First Internet Bank of Indiana 0.80%
6. ableBanking, a division of Northeast Bank 0.80%
7. Bank of Internet USA 0.75%
8. Discover Bank 0.70%
9. VirtualBank 0.65%
10. giantbank.com 0.60%