ING Direct raised its interest rate for its savings account today to 3.4% APY. It’s a very weak move in response to Emigrant Direct upping its savings interest yield from 3.5% to 4.0%. I expect the other online banks will also raise their rates.
By the way, you can always find a collection of the highest-paying savings accounts here. I try to keep it as up-to-date as possible.
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9:02 am (reply)
I think ING feels they don’t need to compete with Emmigrant because they have more customers.
Also, ING is not going to raises rates that much because they have the big advertising campaign to pay for.
10:22 am (reply)
I wouldn’t be surprised to know that ING Direct has more advertising expenses than Emigrant. It just comes down to who offers the best product, and ING has repeatedly seaid that their service puts them above the other banks, even those that offer higher interest rates. For some people, the best bank is simply the one offering the highest interest rate.
1:36 pm (reply)
If you’ve got five thousand dollars in savings, the ING to Emigrant Direct percentage difference comes out to about $25 for the first year – the ING referral bonus covers that.
But the difference grows to over $300 if you have $50,000 in savings – that’s when it really makes sense to search out the best interest rate.