Comments on: Some CD Rates Are Lower Than Savings Accounts! http://harvestingdollars.com/2009/08/09/some-cd-rates-are-lower-than-savings-accounts/ Plant Knowledge. Reap Financial Gain. Fri, 26 Feb 2010 18:51:54 +0000 http://wordpress.org/?v=2.9 hourly 1 By: Gene at www.kitchentablenomics.com http://harvestingdollars.com/2009/08/09/some-cd-rates-are-lower-than-savings-accounts/comment-page-1/#comment-6341 Gene at www.kitchentablenomics.com Sun, 09 Aug 2009 23:34:19 +0000 http://harvestingdollars.com/?p=1114#comment-6341 Just a couple thoughts -- you, I and everyone else who files a 1040 already has money in this bank. This is a way to get some of it back. I don't have any money other than my sliver of the taxpayers contribution there, but I'm not worried about the GM connection within the FDIC limits. I've watched quite a few of these banks being formed when I was a news guy reporting on them; Office of Thrift Supervision, et al, are really fussy regulators. I don't think they regulate the mailing of free calendars to depositors, but darn near. I've wrestled with the 12-mo CD vs. same rate savings account question too. The big difference is that the CD is a contract which guarantees you get the rate for the specified time. Savings account rates can change tomorrow. Savers might have better luck shopping for odd 10-month, 16-month or other weird maturities banks sometimes offer. Banks do that when they need to raise extra money for some specific funding, so they tend to pay more. The trade off is you may need to do some creative laddering to assure future liquid cash if you might need it then. Just a couple thoughts — you, I and everyone else who files a 1040 already has money in this bank. This is a way to get some of it back.

I don’t have any money other than my sliver of the taxpayers contribution there, but I’m not worried about the GM connection within the FDIC limits. I’ve watched quite a few of these banks being formed when I was a news guy reporting on them; Office of Thrift Supervision, et al, are really fussy regulators. I don’t think they regulate the mailing of free calendars to depositors, but darn near.

I’ve wrestled with the 12-mo CD vs. same rate savings account question too. The big difference is that the CD is a contract which guarantees you get the rate for the specified time. Savings account rates can change tomorrow.

Savers might have better luck shopping for odd 10-month, 16-month or other weird maturities banks sometimes offer. Banks do that when they need to raise extra money for some specific funding, so they tend to pay more. The trade off is you may need to do some creative laddering to assure future liquid cash if you might need it then.

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