In an age where savings accounts and other cash-savings options commonly paying less than 1% APY, any bank that offers APYs over that amount deserves a second look. Because of low overhead costs, internet-only banks are giving larger banks a run for their money as they are often able to offer better deals on interest rates even in this poor economy.
SallieMae is currently offering a 1.40% APY on their new online high-yield saving account. There is no minimum balance, no monthly fees, and it offers daily compounded interest. If you are interested in CDs, SallieMae is also offering a 12-month CD at 1.55% APY, a 36-month CD at 2.40% APY, and a 60-month CD at 3.00% APY.
The deal doesn’t end there, however. Sallie Mae has partnered with UPromise, the college savings service for students and their family, to match 10% of annual UPromise earnings. You don’t have to be a member of UPromise to take advantage of the SallieMae High-Yield Savings Account and the 1.40% APY, but if you’re a member of UPromise or if you have children going to college, it’s definitely an added bonus. The money you earn from shopping at UPromise partners goes into your UPromise account, which then can be used to invest in your high-yield savings account, into a tax-deferred 529 plan, or you can also use it to directly pay down your student loans.
One drawback to using internet banks, like SallieMae, is that ATM use may incur fees. However, if you are using an account solely for savings purposes and are able to transfer funds in and out of the account electronically when needed, the added convenience of an internet bank and the higher interest rates make it an attractive option.
For the best information on savings and money market account interest rates, click on the "Savings" tab above.
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