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Best Interest Rates on Cash – December 2021 Update

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Here’s my monthly roundup of the best interest rates on cash as of December 2021, roughly sorted from shortest to longest maturities. Significant changes since last month: Not much… NASA FCU has updated their CD specials, and I finished buying up to the individual limits on the 7% Savings I Bonds for both of us. T-Bills, money market funds, and ETFs are still a pass.

I look for lesser-known opportunities earning more than most “high-yield” savings accounts and money market funds while still keeping your principal FDIC-insured or equivalent. Check out my Ultimate Rate-Chaser Calculator to see how much extra interest you’d earn by moving money between accounts. Rates listed are available to everyone nationwide. Rates checked as of 12/5/2021.

Fintech accounts
Available only to individual investors, fintech companies often pay higher-than-market rates in order to achieve fast short-term growth (often using venture capital). “Fintech” is usually a software layer on top of a partner bank’s FDIC insurance. Read about the types of due diligences you should do whenever opening a new bank account.

  • 3% APY on up to $100,000. The top rate is still 3% APY for October through December 2021 (can be 3.5% APY with their credit card), and they have not indicated any upcoming rate drop. HM Bradley requires a recurring direct deposit every month and a savings rate of at least 20%. Due to high demand, you must currently use a referral link to join. If you have any available to share (you only get 3), thanks to those who have dropped theirs in the comments of my HM Bradley review.
  • 3% APY on 10% of direct deposits + 1% APY on $25,000. One Finance lets you earn 3% APY on “auto-save” deposits (up to 10% of your direct deposit, up to $1,000 per month). Separately, they also pay 1% APY on up to another $25,000 with direct deposit. New customer $50 bonus via referral. See my One Finance review.
  • 3% APY on up to $15,000. Porte requires a one-time direct deposit of $1,000+ to open a savings account. New customer $50 bonus via referral. Important note: Porte is adding additional restrictions including minimum monthly transactions in January 2022. See my Porte review.
  • 1.20% APY on up to $50,000. You must maintain a $500 direct deposit each month for this balance cap, otherwise you’ll still earn 1.20% on up to $5,000. See my OnJuno review.

High-yield savings accounts
Since the huge megabanks pay essentially no interest, I think every should have a separate, no-fee online savings account to accompany your existing checking account. The interest rates on savings accounts can drop at any time, so I list the top rates as well as competitive rates from banks with a history of competitive rates. Some banks will bait you with a temporary top rate and then lower the rates in the hopes that you are too lazy to leave.

  • T-Mobile Money is still at 1.00% APY with no minimum balance requirements. The main focus is on the 4% APY on your first $3,000 of balances as a qualifying T-mobile customer plus other hoops, but the lesser-known fact is that the 1% APY is available for everyone. Thanks to the readers who helped me understand this. Unfortunately, some readers have reported their applications being denied.
  • Evangelical Christian Credit Union (ECCU) is offering new members 1.01% APY on up to $25,000 when you bundle a High-Yield Money Market Account & Basic Checking. (Existing members can get 0.75% APY.) To join this credit union, you must attest to their statement of faith.
  • There are several other established high-yield savings accounts at closer to 0.50% APY. Marcus by Goldman Sachs is on that list, and if you open a new account with a Marcus referral link (that’s mine), they will give you and the referrer a 1.00% APY for your first 3 months (a 0.50% boost). You can then extend this by referring others to the same offer.

Short-term guaranteed rates (1 year and under)
A common question is what to do with a big pile of cash that you’re waiting to deploy shortly (plan to buy a house soon, just sold your house, just sold your business, legal settlement, inheritance). My usual advice is to keep things simple and take your time. If not a savings account, then put it in a flexible short-term CD under the FDIC limits until you have a plan.

  • No Penalty CDs offer a fixed interest rate that can never go down, but you can still take out your money (once) without any fees if you want to use it elsewhere. CFG Bank has a 13-month No Penalty CD at 0.62% APY with a $500 minimum deposit. Ally Bank has a 11-month No Penalty CD at 0.50% APY for all balance tiers. Marcus has a 7-month No Penalty CD at 0.45% APY with a $500 minimum deposit. You may wish to open multiple CDs in smaller increments for more flexibility.
  • Lafayette Federal Credit Union has a 1-year CD at 0.80% APY ($500 min). Early withdrawal penalty is 6 months of interest. Anyone can join this credit union via partner organization ($10 one-time fee).

Money market mutual funds + Ultra-short bond ETFs
Many brokerage firms that pay out very little interest on their default cash sweep funds (and keep the difference for themselves). Unfortunately, money market fund rates are very low across the board right now. Ultra-short bond funds are another possible alternative, but they are NOT FDIC-insured and may experience short-term losses at times. These numbers are just for reference, not a recommendation.

  • The default sweep option is the Vanguard Federal Money Market Fund which has an SEC yield of 0.01%.
  • Vanguard Ultra-Short-Term Bond Fund currently pays 0.45% SEC yield ($3,000 min) and 0.55% SEC Yield ($50,000 min). The average duration is ~1 year, so your principal may vary a little bit.
  • The PIMCO Enhanced Short Maturity Active Bond ETF (MINT) has a 0.35% SEC yield and the iShares Short Maturity Bond ETF (NEAR) has a 0.44% SEC yield while holding a portfolio of investment-grade bonds with an average duration of ~6 months.

Treasury Bills and Ultra-short Treasury ETFs
Another option is to buy individual Treasury bills which come in a variety of maturities from 4-weeks to 52-weeks. You can also invest in ETFs that hold a rotating basket of short-term Treasury Bills for you, while charging a small management fee for doing so. T-bill interest is exempt from state and local income taxes. Right now, this section isn’t very interesting as T-Bills are yielding close to zero!

  • You can build your own T-Bill ladder at TreasuryDirect.gov or via a brokerage account with a bond desk like Vanguard and Fidelity. Here are the current Treasury Bill rates. As of 12/3/2021, a new 4-week T-Bill had the equivalent of 0.04% annualized interest and a 52-week T-Bill had the equivalent of 0.25% annualized interest.
  • The Goldman Sachs Access Treasury 0-1 Year ETF (GBIL) has a -0.07% SEC yield and the SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL) has a -0.09% (!) SEC yield. GBIL appears to have a slightly longer average maturity than BIL.

US Savings Bonds
Series I Savings Bonds offer rates that are linked to inflation and backed by the US government. You must hold them for at least a year. If you redeem them within 5 years there is a penalty of the last 3 months of interest. The annual purchase limit for electronic I bonds is $10,000 per Social Security Number, available online at TreasuryDirect.gov. You can also buy an additional $5,000 in paper I bonds using your tax refund with IRS Form 8888.

  • “I Bonds” bought between November 2021 and April 2022 will earn a 7.12% rate for the first six months. The rate of the subsequent 6-month period will be based on inflation again. We have both bought up to the individual limits for 2021. Details here.
  • In mid-April 2022, the CPI will be announced and you will have a short period where you will have a very close estimate of the rate for the next 12 months. I will have another post up at that time.
  • See below about EE Bonds as a potential long-term bond alternative.

Prepaid Cards with Attached Savings Accounts
A small subset of prepaid debit cards have an “attached” FDIC-insured savings account with exceptionally high interest rates. The negatives are that balances are severely capped, and there are many fees that you must be careful to avoid (lest they eat up your interest). There is a long list of previous offers that have already disappeared with little notice. I don’t personally recommend nor use any of these anymore, as I feel the work required and risk of messing up exceeds any small potential benefit.

  • Mango Money pays 6% APY on up to $2,500, if you manage to jump through several hoops. Requirements include $1,500+ in “signature” purchases and a minimum balance of $25.00 at the end of the month.

Rewards checking accounts
These unique checking accounts pay above-average interest rates, but with unique risks. You have to jump through certain hoops which usually involve 10+ debit card purchases each cycle, a certain number of ACH/direct deposits, and/or a certain number of logins per month. If you make a mistake (or they judge that you did) you risk earning zero interest for that month. Some folks don’t mind the extra work and attention required, while others would rather not bother. Rates can also drop suddenly, leaving a “bait-and-switch” feeling.

  • Quontic Bank is offering 1.01% APY on balances up to $150,000. This is best for people who have high balances, as the rate is not as high as other rewards checking accounts. You need to make 10 debit card point of sale transactions of $10 or more per statement cycle required to earn this rate.
  • The Bank of Denver pays 2.00% APY on up to $10,000 if you make 12 debit card purchases of $5+ each, receive only online statements, and make at least 1 ACH credit or debit transaction per statement cycle. The rate recently dropped. If you meet those qualifications, you can also link a Kasasa savings account that pays 1.00% APY on up to $25k. Thanks to reader Bill for the updated info.
  • Presidential Bank pays 2.25% APY on balances between $500 and up to $25,000, if you maintain a $500+ direct deposit and at least 7 electronic withdrawals per month (ATM, POS, ACH and Billpay counts).
  • Evansville Teachers Federal Credit Union pays 3.30% APY on up to $20,000. You’ll need at least 15 debit transactions and other requirements every month.
  • Lake Michigan Credit Union pays 3.00% APY on up to $15,000. You’ll need at least 10 debit transactions and other requirements every month.
  • Find a locally-restricted rewards checking account at DepositAccounts.

Certificates of deposit (greater than 1 year)
CDs offer higher rates, but come with an early withdrawal penalty. By finding a bank CD with a reasonable early withdrawal penalty, you can enjoy higher rates but maintain access in a true emergency. Alternatively, consider building a CD ladder of different maturity lengths (ex. 1/2/3/4/5-years) such that you have access to part of the ladder each year, but your blended interest rate is higher than a savings account. When one CD matures, use that money to buy another 5-year CD to keep the ladder going. Some CDs also offer “add-ons” where you can deposit more funds if rates drop.

  • NASA Federal Credit Union has a special 49-month Share Certificate at 1.70% APY ($10,000 min of new funds). Early withdrawal penalty is 1 year of interest. They also have a 15-month special at 1.05% APY and 8-month at 0.80% APY.
    Anyone can join this credit union by joining the National Space Society (free). However, NASA FCU will perform a hard credit check as part of new member application.
  • Lafayette Federal Credit Union has a 5-year CD at 1.26% APY ($500 min). Early withdrawal penalty is 6 months of interest. Anyone can join this credit union via partner organization ($10 one-time fee). PenFed and other credit unions now offer rates close to 1.25% on a 5-year CD.
  • You can buy certificates of deposit via the bond desks of Vanguard and Fidelity. You may need an account to see the rates. These “brokered CDs” offer FDIC insurance and easy laddering, but they don’t come with predictable early withdrawal penalties. Right now, I see a 5-year CD at 1.25% APY. Be wary of higher rates from callable CDs listed by Fidelity.

Longer-term Instruments
I’d use these with caution due to increased interest rate risk, but I still track them to see the rest of the current yield curve.

  • Willing to lock up your money for 10 years? You can buy long-term certificates of deposit via the bond desks of Vanguard and Fidelity. These “brokered CDs” offer FDIC insurance, but they don’t come with predictable early withdrawal penalties. You might find something that pays more than your other brokerage cash and Treasury options. Right now, I see a 10-year CD at 1.80% APY vs. 1.29% for a 10-year Treasury. Watch out for higher rates from callable CDs from Fidelity.
  • How about two decades? Series EE Savings Bonds are not indexed to inflation, but they have a unique guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently 0.10%). I view this as a huge early withdrawal penalty. But if holding for 20 years isn’t an issue, it can also serve as a hedge against prolonged deflation during that time. Purchase limit is $10,000 each calendar year for each Social Security Number. As of 12/3/2021, the 20-year Treasury Bond rate was 1.77%.

All rates were checked as of 12/5/2021.

Consumer Reports: Top 10 Most Reliable Car Brands 2021

Consumer Reports has released updated results from their 2021 Car Owner Survey in the articles Who Makes the Most Reliable Cars?, 10 Most Reliable Cars, and 10 Least Reliable Cars. Most of it is now behind a paywall, but more info can be found in outside media coverage like USA Today. Here are highlights, including the Top 10 and Bottom 5:

  • Most reliable: Lexus is back at #1, but the top 3 are the same (Lexus, Mazda, Toyota)
  • Most improved ranking (into Top 10): Infiniti and Acura.
  • Biggest ranking drops (out of Top 10): Hyundai and Ram.

Consumer Reports Top 10 Most Reliable Car Brands, 2021 (2020 ranking)

  1. Lexus (3)
  2. Mazda (1)
  3. Toyota (2)
  4. Infiniti
  5. Buick (4)
  6. Honda (5)
  7. Subaru (8)
  8. Acura
  9. Nissan
  10. Mini

Consumer Reports Bottom 5 LEAST Reliable Car Brands, 2021

  • Volkswagen
  • Genesis
  • Jeep
  • Tesla
  • Lincoln

The following brands did not have enough survey responses to be ranked: Alfa Romeo, Dodge, Fiat, Jaguar, Land Rover, Maserati, Mitsubishi, and Polestar.

Here are the 2020 rankings for the curious. I don’t think these rankings are perfect, but I do believe they are unbiased and based on actual reader surveys.

Despite providing these brand rankings, Consumer Reports recommends that you shop by specific vehicle model and not just by brand make. Reliability problems often occur when a new model is released with a new engine and/or drivetrain system. In my opinion, this makes the best bet to buy a Toyota/Lexus/Mazda model that is a few years into the current generation, after any remaining kinks have been worked out. Not exciting, but neither is the hassle and expense of dealing with car repairs. Consumer Reports print subscribers can add digital access for $25 per year.

Target: 10% Off Gift Cards on 12/4 and 12/5 Only (Up to $50 off $500)

Target Circle is offering 10% off up to $500 in Target Gift Cards on Saturday, December 4th and Sunday, December 5th, 2021. Offer available both in-store and online. Before you buy the gift cards, activate in your Target Circle account first … [Read the rest]

Morningstar Safe Withdrawal Rate Report: 3.3% Base Rate + Ways To Increase It

Financial freedom seekers usually have a Number - the value at which their investments can support their spending indefinitely. This is directly linked to "safe withdrawal rates". For example a 4% safe withdrawal rate is a 25x multiplier - meaning … [Read the rest]

Giving Tuesday 2021: Matching Donations and Finding The Right Charity

Tuesday, November 30th is Giving Tuesday 2021, an international day about giving support through charities and nonprofits by donating money or volunteering your time. In case you aren't inundated with mailings already, this time of year is a big … [Read the rest]

IKEA Gift Cards: Buy $100 in Gift Cards, Get Free $20 eGift Card (11/29 Only)

New Cyber Monday offer - One day only. IKEA has a limited-time promotion where for every $100 gift card that you buy online, you will receive a bonus $20 eGift Card. Terms and conditions: For every $100 in IKEA eGift cards purchased online from … [Read the rest]

Black Cyber Deals: Low-Hanging Fruit and Buy Now Pay Later Mind Tricks

I attempted a bit of a "digital vacation" this long weekend in order to maximize my feelings of thankfulness, but I couldn't help taking a peek at what was available in the "I was going to spend this money anyway" department. I'll try to keep this … [Read the rest]

Healthywage Review: Bet on Yourself, Get Paid To Lose Weight ($100 Prize Bonus)

(Black Friday Promo: Click this special link for $100 Healthywage Profit Boost for a limited-time until December 3rd, 2021. This is the highest promo they offer, and only a few times per year. Look for the banner on top. Read on for how Healthwage … [Read the rest]

Discount Magazines Black Friday Sale 2021

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AMC+ Black Friday Deal: $1.99/Mo with Annual Plan (70% Off)

The AMC+ streaming service is also running a Black Friday deal where you can pay $1.99/month if you buy the annual plan ($23.88 + tax). The standard monthly cost of AMC+ is $8.99 (plus tax). The standard price for the annual plan is $83.88, making … [Read the rest]

Chewy.com Black Friday: Free $30 Gift Card with First $49 Rx

Online pet store Chewy.com is offering a variety of Black Friday deals. I'd like to see another 15% off gift card deal, but this one also looks good: Free $30 Chewy eGift Card with First-Time Pharmacy Purchase of $49+. Buy your flea … [Read the rest]

Hulu: $0.99/mo for 12 Months (with Ads)

Hulu has a Black Friday deal where new and returning subscribers can get the ad-supported plan for 99 cents a month for 12 months. Will auto-renew after 12 months at regular price, so set a calendar reminder to cancel. Offer expires November 29th, … [Read the rest]