Chase and Bank of America are the big losers when it comes to providing a savings rate for their account holders. Currently both Chase and B of A offer a interest rate on their savings account of a measly 0.01% (APY). What do you get for this paltry return? Not much really, except a systemically important banks that has little chance of failing as the Feds will always bail them out.
As for alternatives, Raisin, a Fintech that has created a savings marketplace that lets users review offers available without geographic limitations is currently promoting a 5.42% return for a CD offered by Mission Valley Bank. Worried about liquidity? No worries the CD’s term is just one month. Raisin notes that the Mission Valley Bank offering is 24.6X the national average when it comes to savings.
If you are interested in a traditional savings acount there are many different banks around the US listed on Raisin that are currently offering a 5.26% APY return – which is pretty good – with all of these savings accounts being FDIC insured.
And what about some well known Fintechs / Digital Banks and the APY on offer?
LendingClub – 4.5%
SoFi – 4.5%
Varo Money – 5% (up to $3000 and 3.0% on the rest)
Marcus (Goldman Sachs) 4.4%
Apple Savings – 4.18%
Are there any big banks that are competitive?
Citi is promoting an APY of 4.35%
While all rates are subject to change and you gotta read the small print, it may make sense to park your money elsewhere if you are a customer at a bank like Chase or Bank of America because in real terms, you are losing money on your savings and Chase and B of A are banking it with the enormous spread.