Community Banks Still Providing Top Interest Rates
Back in early September (before the really bad economic news started rolling in), I wrote about the excellent interest rates available at community banks. Since that time there has been a lot of upheaval and change within the banking community. A lot of that change relates to increased loan underwriting standards, making it more difficult to borrow money at the big banks, most of whom are stuck with bad balance sheets from bad loans.
Also, the personal finance blogosphere continues to give us a steady diet of this “deal” and that “deal” at the name brand online banks. Unfortunately, those “deals” include shrinking interest rates. So I thought I would take another quick look at interest rate deals at the community banks. What I found is that there still plenty of comparatively better interest rates at many of your local brick and mortar banks.
Reviewing other bank account options at CheckingFinder, one bank (Southern Missouri Bank) is paying 6.01%!
There are some basic usage requirements for these accounts that I summarized in my earlier post but they are not unreasonable given the rates paid, with no account fees, refunded ATM fees, and no minimum balances. Keep in mind also that these are FDIC insured and that you can open these accounts online and/or through the mail. You do not have to be present to win!
When I first posted about community banks and their high interest checking accounts, Mr. ToughMoneyLove received some criticism from others who seemed obsessed with the name brands, such as ING Direct, HSBC, and the like. That criticism was and is unfounded if your objective is to put money into a bank providing the highest yield and you are willing to meet some basic usage requirements to earn it. On a deposit balance of $25,000, there is a significant difference between the 5%-6% offered by these community banks and the 2.75% that the name brands are currently paying.
Carnivals this Week:
Photo credit: GravityX9