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ING Direct Drops Orange Savings Account to 2.75% APY
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ING Direct's Orange Savings Account has fallen from to 2.75% APY (down from 3.00%).
While this is probably in reaction to the Fed's rate cut of 0.5%, it's the first drop we've seen from a major online bank (this side of WaMu's acquisition by JP Morgan Chase).
ING also changed their rates on their Electric Orange checking account:
- $0-49,999.99 earns a 1.50% APY
- $50,000.00-$99,999.99 earns a 3.05% APY
- $100,000.00 or more earns a 3.25% APY
ING's online savings account hasn't been in the top tier of APYs for some time now, but many of their customers enjoy the service so much they don't seem to mind.
Personally, I have an Electric Orange account for my business and an Orange Savings Account for a short-term car fund.
If you're looking for other online savings accounts, check out DollarSavingsDirect (3.75% APY), FNBO Direct (3.50% APY), WT Direct (3.26% APY) or HSBC Direct (3.25% APY).
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FNBO's Pay Yourself First Finalists Announced
FNBO Direct's Pay Yourself First contest, which chronicles the savings journey of everyday people, has announced its five finalists (there were 20 semi-finalists).
According to the Web site, the challengers are ….
Alexa
Alexa was adopted from Korea as a child. She now lives with her husband Seth in San Francisco. Alexa is saving for a trip to Korea in the hopes of finding her birthmother and to learn more about her heritage.Dave
Dave and his wife Glenda are saving for a larger house for themselves – and their five daughters. They want to move their large family to a newer community – and a house with more than one bathroom.Tim
Tim and his wife, Beth, are saving to pay off his student loans. Tim hopes that by participating in the Challenge he and his wife will learn new tips and tricks to accomplish their goal.Kristen
Kristen, her husband, Michael, and their daughter have just returned from 3 years in the Dominican Republic. They are saving to pay for Kristen's nursing school so that they may return to the D.R. with no debt.Phil
Phil and his wife, Teresa, live in Texas and are saving for expenses related to their first baby – due in March 2009. Phil looks forward to sharing his savings journey – and the story of their first child – with others throughout the Challenge.You have to hand it to FNBO, who has really put together a well-meaning contest. Encouraging people to save — and rewarding them for it — is a great way to show that they care about their customers.
Each of the five finalists will get their savings matched dollar-for-dollar by FNBO (up to $5,000). The grand prize winner will receive an all-expenses paid vacation, worth up to $7,500.
FNBO Direct's online savings account is currently paying a 3.50% APY, making it one of the top currently available.
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WaMu Drops Online Savings Account to 3.00% APY
Washington Mutual has dropped the interest rate on its online savings account to 3.00% APY (via Bank Deals).
WaMu had upped their OSA all the way to 4.00% APY in the past few months, so this is a pretty big drop.
It's not a huge surprise, especially with the recent news of their acquisition by JP Morgan Chase.
The drop takes them pretty far out of contention for the highest online savings accounts currently available.
If you're looking for a good place to stash your money, consider an online savings account from DollarSavingsDirect (3.75% APY), FNBO Direct (3.50% APY), WT Direct (3.26% APY) or HSBC Direct (3.25% APY).
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Keep the Change, Way2Save Not Worth It, Says Consumer Reports
Didn't believe me that Bank of America's Keep the Change program isn't worth it? I'm not the only one saying it.
Consumer Reports, probably the best consumer-advocate publication available today, agrees. In their upcoming November issue, they basically make the same argument I made in late August.
In its latest report, the Consumer Reports Money Lab took a look at three of the more well-known spend and save programs: Bank of America's Keep the Change, Wachovia's Way2Save and American Express One. CR found all three were limited and perhaps more rewarding options exist.
"Saving money can be tough. These programs offer the hope that something good can come from spending more, but when we crunched the numbers, we found the overall savings to be limited," said Noreen Perrotta, Consumer Reports money editor.
According to Consumer Reports's number crunching, it would take 1,728 transactions (averaging $.50 each) to get the $250 total Keep the Change match the first year. In the second year, it will take 10,000.
Wachovia's Way2Save isn't much better. The program, which moves $1 from your checking to savings account with every transaction, limits additional deposits to $100/month. And while it offers a 5 percent interest rate the first year, it drops to 2 percent for the second.
If you're looking for a good place to stash your money, consider an online savings account from DollarSavingsDirect (3.75% APY), FNBO Direct (3.50% APY), WT Direct (3.26% APY) or HSBC Direct (3.25% APY).
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Washington Mutual Ups Online Savings Account to 4.00% APY
Washington Mutual has just upped the APY on its online savings account to 4.00% APY, putting it right at the top of currently available options (via Five Cent Nickel).
While WaMu is currently having some problems — at least five companies are reportedly considering purchasing the bank — but since it is FDIC insured, you shouldn't worry about putting money into it.
APYs have been going up and down for the past few months with no obvious trend — just like the stock market.
DollarSavingsDirect (3.75% APY), FNBO Direct (3.50% APY), WT Direct (3.26% APY), and HSBC Direct (3.25% APY) are some of the top offerings.
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E-Loan Intros Savings Plus High-Yield Online Account
E-Loan, which at one point had the highest online savings account, has introduced a new product: the Savings Plus account.
Offering a tiered APY, the Savings Plus Account requires monthly deposits of at least $100.
Accounts that do not have at least $100 deposited for more than 60 days will be converted into a standard online savings account, according to the terms of service.
Here's the breakdown on the tiered APYs:
Current users of E-Loan's online savings account can convert to a Savings Plus account.
Existing E-LOAN Savings Accounts can easily be converted to Savings Plus. Just log in, click "Transfer Funds" and set up a recurring deposit of at least $100 a month and type in Promo Code RREC08.
There are no fees with the account, but a $5,000 minimum is needed to open.
E-Loan's online savings account is currently offering a 3.01% APY.
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HSBC Direct Drops Online Savings Account to 3.25% APY
After a summertime promotion, HSBC Direct is lowering its online savings account APY to 3.25% APY.
The account had offered a 3.50% APY, originally launched in June but extended until 9/15 about half-way through the promo.
While I'm a fan of HSBC and use it to hold our housing fund, dropping back to 3.25% puts it further out of the top-rate leaderboard, with DollarSavingsDirect (3.75% APY), FNBO Direct (3.50% APY) and WT Direct (3.26% APY) leading the way.
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3 Steps to Determining Your Financial Goals
ING Direct has a great feature on their site about establishing your financial goals and how to get there.
Their three steps:
- Get it down on paper
- The long, medium, and short of it
- How much are my dreams likely to cost?
If you don't have access to an ING Direct account (get started with $25 free), here's the extended version of the plan.
Step 1 — Get it down on paper
The first step in planning a trip is to know exactly where you’re going. The same is true for your financial plans. With a specific plan, you can stop drifting along and start driving.Step 2 — The long, medium, and short of it
As you make your list of goals, you need to think about when you will want to achieve them:* Short-term goals (1-3 years), such as paying off debt or renovating your house
* Medium-term goals (4-10 years), such as saving enough for a down payment on a house, or building your IRA, 529 college savings plans, and other tax-deferred accounts
* Long-term goals (10+ years), such as paying for your toddler’s college education or retiring comfortably
Remember: No goal is short-, medium-, or long-term by definition. Retirement might be a long-term goal if you’re 30, but a short-term goal if you’re 65. A college education might be a long-term goal for a toddler, but a short-term one for a teenager. The more specific your time frame, the more you’ll want to make sure you have money available when you need it.
Step 3 — How much are my dreams likely to cost?
If you don’t know what each of your goals will cost, you’ll need to do a little research. Ballpark numbers are fine. For goals that are more than a few years away, inflation is worth thinking about. Historically, inflation has averaged about 3% per year. At that rate, a home renovation that costs $30,000 today will cost about $35,000 in five years and about $40,000 in ten. Getting the best rate you can for your savings can help you keep the value of your money where it should be.Never too soon
Of all the goals you set for yourself, preparing for a comfortable and satisfying retirement should be a priority. Studies show that average US households are saving enough to replace less than 60% of their pre-retirement income during retirement. But most experts agree that you’ll need about 85% of your pre-retirement income for a comfortable retirement. Saving now (rather than putting it off till later) can make the difference between just dreaming about retirement and having the retirement of your dreams.
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