12 month CD Rate Averages
The 12 month CD rate averages are still falling to 0.82% or 0.87% in mid December 2009 depending on which survey you look at. This has been a trend since the Federal Reserve has decided to keep interest rates artificially low. The hope of this strategy is to inspire banks to make loans. The rates the bank pay of an overnight loan is 0.00% to 0.25%. Unfortunately, this strategy has not worked while banks continue to give their corporate leaders huge bonuses in spite of their failures this past year.
The unfortunate side effect of this strategy is low interest rates on savings accounts, checking accounts, money market accounts, and CDs. This has many investors worried and for those that are retired and on fixed incomes, these times are leading to desperate actions.
There are some financial institutions that are keeping their 12 month CD rates at a considerable amount higher than the national average. The Colorado Federal Savings Bank is offering their 12 month CD with an interest rate of 1.98% and an APY of 2.00%. This rate was posted on 12/15/09 and requires a deposit of $5,000. Another financial institution that is one of the best CD rates today is UmbrellaBank.com from Alabama. They are offering a 12 month CD with an interest rate of 1.93% and an APY of 1.95%. This rate was posted on 12/17/09 and requires a deposit of $1,000.
At the other end of the spectrum, there is Capital One Direct Banking that has an interest rate on their 12 month CD of 0.50% and an APY of 0.50%. This rate was posted on 12/17/09 and required a deposit of $5,000.
Despite the 12 month CD rate averages being low, there are still some financial institutions that are offering at or near 2% APY for your investment dollars.
Related posts:
- Ally Bank 11 Month No Penalty CD Rate Increase (1.38% APY)
- Best CD Rate Chase Bank
- Best 9 Month CD Rates
- CD Rates Versus Fed Funds Rate Increases
- Best CD Rate Zions Bank
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