SmartyPig Upcoming Interest Rate Drop To 1.75% APY

Online savings site just announced that they will drop their interest rate from 2.15% APY to 1.75% APY on September 7th, 2010 (for balances up to $50,000, FDIC-insured). While this is sad news, and of course happened after I initiated a funds transfer over there, they do still offer one of the highest overall rates for an online liquid savings account. They compiled this rate history with other online bank like Ally Bank and Capital One 360 to show that they have remained very competitive over time:

The only bank with a higher rate and full liquidity is EverBank with their 2.25% Intro rate with an additional $25/$50 bonus on top if you open with $10k/$20k.

Although not set up exactly like the others, their online “piggy bank” model is interesting, and I wrote about tips on how to use it like a savings account with their flexible rules.


  1. Ally Bank dropped their rates from 1.29% to 1.25% APY last week. It’s a small change, but not in the direction that I want to see rates going.

  2. I signed up right -after- they announced this, unaware. I’ll use it for a few goals but that’s it. The comments of the Smarty-Pig blog post about the rate reduction included a link to the Redneck bank and AmericaNet bank families that offer a 4% checking account that requires 10 uses of their check card per month to get 4%. Up to $10k, after that interest drops. I am highly considering this instead of the Pig

  3. Opened Smarty Pig after your last post and now bummed on the drop. Not a big fan of the Pig’s interface. I just want a simple savings account with good rates.

  4. Viewpoint is still at 4% for their absolute checking. I’ve been with them since last year. I send one $1 bill pay check to myself at the beginning of the month, and then do 15 transactions at the supermarket for like 10 cent notebooks. I usually do five each time I’m there and go through the self checkouts. So for $2.50/mth I get $xxx in interest. Not bad.

  5. Any idea why they are dropping their rates?

  6. @jenna ummmm crap economy perhaps

  7. I’m also part of the 4% club. Reward checking, if you can remember the few rules, is the way to go.

  8. @tks – Free From Broke mentioned the bad economy on their blog post about the same topic. Thanks!

  9. well, why would their rates be going up? No other rates are going up. The Fed isn’t raising rates

    its just a matter of time before all the rates come down to similar levels

  10. Banks offer what they can based on what they can earn with your deposits and what the competition is offering. In this case, SmartyPig is both online (and hopefully lean although BBVA is brick & mortar too) and they make money when you convert any $100 to a $105 gift certificate.

  11. How do they make money when they convert my $100 to $105 giftcard? Arent they losing $5, including the 7-10 days float when the goal is closed and gift card is sent in mail?

  12. fred, they likely bought that $105 giftcard for $100 or less, so they’re not losing money there. There’s many other places that sell gift cards for less than face value, for this same reason.

  13. I just started looking for somewhere to move my savings to, since I’m looking to share an account with my wife and SmartyPig doesn’t allow joint accounts. I came across AmericaNet Bank, and am wondering why there isn’t talk about this place all over the internet, since as far as I can tell, it’s by far the best interest offering deal I’ve seen.

    The savings account is decent, with 1.75% for $35k and under. No fees or minimums. The checking account, however, is where it gets good. 3.75% for $10k and under. So really, I can keep $45k there, with $10k getting 3.75%, and the rest getting 1.75%.

    There is a requirement to make 10 debit card purchases each month for the checking account to get the 3.75% rate. That’s usually an immediate deal breaker for me, but I thought about it, and I easily make 10 purchases at grocery, drug, 7-11/liquor store-type places each month, and I spend $150-200/month on those purchases. Even with the 5% back that I get from credit cards sometimes (Chase Freedom currently), that’s only $10 back, compared with ~$30 I’d be getting in interest from the checking account… although I guess I should factor in the fact that I could be getting interest from having that cash in a different account somewhere else.

    Still, if it was in a 1.75% savings account, I’d be getting an extra $15 this way, which beats the $10 from credit cards. Not to mention that there are plenty of random purchases I make with credit cards that don’t fall into any of the categories and just get the base 1% back, so I can knock out some of the 10 purchases with those.

    I might see if my wife can open her own checking account there too. I read somewhere that they only allow one savings account per household, but perhaps two checking accounts is allowed.

    Anyone else heard of this? Searches for recent updates on savings and checking account rates brings up a lot of talk about AMEX, Discover, and a bunch of other accounts that don’t look as good. I feel like I must be missing something.

  14. Jessica Sethman says:

    I’m not trying to insult anybody, I would just like to know if that’s the way it is all over the world or if it is something

    in the US or if maybe I just don’t understand how APY really works or something like that.

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