I gotta say I was pretty shocked when checking out our 5 year certificate of deposit database last weekend only to find the first 2.0% yield I’ve seen since 2010.
It’s no secret that FDIC insured saving rates have been entrenched in a historically low valley for nearly half a decade now, and after hearing many financial opinion pieces lately about the FEDs coming moves, I’ve been fairly pessimistic.
Now, however, after seeing EverBank make the first move in ticking long term rates upward, I’m kind of excited about the prospect of all FDIC insured savings products seeing their rates make some upward movement during the last half of this year.
The illusive 2 percent 5 year CD (first sighting – August 2013):
Leave it to EverBank to make rate hike. EverBank’s 5 year CD currently yielding 2.06% APY is in line with the aggressive rate offers they’ve been making for years. Decent rates are such a core part of Everbank’s strategy for enticing new customers that they even have what they call a “yield pledge” that they make to all of their customers which simply promises (or guarantees) that the rate you get from them will stay amongst the top 5 percent of all rates for that given product.
EverBank’s 5 year deposit can be opened online and Everbank actually has a fairly simply and easy opening process. When doing it online you’ll have to open the deposit with either a wire transfer or check(s).
If you’re going to proceed with this deposit just be sure to read the fine print too. One of the biggest downsides of a CD from Everbank is that they impose some pretty hefty early withdrawal penalties which currently amount to nearly 25% of your accrued interest. This is a little less lenient than some of the other big brand online banks, so be sure you wont need to have access to any of the money you stash away for the entire 5 year term.
They also have a low minimum opening deposit requirement of just $1,500 but there are no monthly service or maintenance fees which many banks impose especially for lower deposit amounts.
Hopefully Everbank’s rate increase is a sign of things to come for all deposits and savings accounts. Home buyers and refinancers have had a long enough hay day with low rates, its time for us savers to get back to saving.