Just when it seemed savings and money market rates couldn't fall
any lower, finding decent rates somehow got a little tougher in the
first quarter of 2012. But MoneyRates.com's America's Best Rates
feature is still here to help savers maximize the returns on their
deposit accounts.
America's Best Rates differs from other rate listings in that it
is not a snapshot of a single day's rates. For this study,
MoneyRates.com looks at the average rates offered by each bank over
a full calendar quarter so it can highlight banks that offer high
rates consistently. The results of the survey are based on the
MoneyRates Index, a representative sample of 100 banks that
includes the nation's 50 largest banks by deposits and a number of
smaller banks.
America's Best Rates: Savings account rates
The savings account interest rates surveyed averaged an annual
percentage yield (APY) of just 0.20 percent in the first quarter of
2012, down one basis point from the
2011 Q4 study
. But not all banks suffered from rates this low. Here are the 10
banks that offered the highest average savings account rates in the
first quarter of 2012:
|
Bank
|
Average Savings Account Rate
|
|
1. Discover Bank
|
0.89
|
|
2. Sallie Mae Bank
|
0.87
|
|
3. Ally Bank
|
0.84
|
|
4. American Express
|
0.84
|
|
5. ING Direct
|
0.80
|
|
6. EverBank
|
0.76
|
|
7. Mile High Bank
|
0.75
|
|
8. MetLife Bank
|
0.70
|
|
9. Zions Bank
|
0.69
|
|
10. Capital One Bank
|
0.68
|
Last quarter, Discover and Sallie Mae tied for the top spot, so
the two leaders are unchanged this quarter, except Discover has
earned sole possession of the number one ranking. In all, nine of
the top 10 banks for savings account rates repeated from last
quarter, with MetLife being the sole newcomer to the top 10.
America's Best Rates: Money market rates
Money market rates averaged 0.24 percent APY in the first
quarter, but again, the top 10 banks offered considerably higher
rates than that:
|
Bank
|
Average Money Market Rate
|
|
1. Sallie Mae Bank
|
0.91
|
|
2. Nationwide Bank
|
0.88
|
|
3. Ally Bank
|
0.84
|
|
4. Discover Bank
|
0.84
|
|
5. MetLife Bank
|
0.79
|
|
6. EverBank
|
0.76
|
|
7. AIG Bank
|
0.74
|
|
8. Zions Bank
|
0.69
|
|
9. Hudson City Bank
|
0.63
|
|
10. OneWest Bank
|
0.56
|
Fittingly for a survey that seeks banks that offer the best
rates, the latest rankings show a high degree of continuity from
the previous quarter. Sallie Mae repeated its number one ranking
from last quarter, and all the banks in last quarter's top 10 also
made the top 10 this quarter.
Recent trends
On average, both the money market and
savings account rates
surveyed continued to fall in the first quarter of 2012. The
overall average savings account rate dropped by 0.013 percent from
the fourth quarter of 2011, and the overall average money market
rate declined by 0.012 percent.
Even the top rates were not immune to the trend. Last quarter,
the top rate in each category was 1.00 percent, but this quarter
only one account -- Sallie Mae's money market account -- eclipsed
the 0.90 percent mark, and it barely did that at 0.91 percent.
Finding the sweet spot
With bank rates falling, where should you look to find the most
competitive rates? The banks on the above top 10 lists are great
places to start, but you should always do some comparison shopping
before you make a final decision. After all, savings and money
market rates are subject to change at any time. Plus, not all banks
are available in all areas, and some offer different rates in
different states.
In terms of type, the rates at
online banks
continued to outpace those found at brick-and-mortar establishments
by a significant margin. Online savings accounts averaged 0.59
percent, while savings accounts at traditional banks averaged just
0.15 percent. Online money market accounts averaged 0.69 percent,
well above the traditional bank average of 0.20 percent.
In regard to size, medium-sized banks (those with between $5
billion and $25 billion in deposits) offered higher rates on
average than their larger and smaller counterparts. Savings account
rates at medium-sized banks averaged 0.26 percent, compared with
0.20 percent for the category overall. Money market rates at
medium-sized banks averaged 0.28 percent, compared with 0.24
percent for the category overall.
While finding good rates got a little tougher in the first
quarter, settling for dismal rates is still a sure way to lose
purchasing power. But by noting the distinctions in America's Best
Rates, you can avoid becoming another victim of today's low
interest rate environment.