The top CD annal percentage yield (APY) this week is at Pentagon Federal Credit Union for a 7-year certificate of deposit currently paying 3.51%. From my survey of six months ago, this same certificate was paying 4.5%!
With rates so low, banks will try to sell you their annuity products. Make sure you read my article: Beware of Annuities. The table below shows the best CD rates for other terms. If that table is hard to read, then try Very Best CD Rates.
"Highest CD Rate Survey + Current US Treasury Rates"
| Term | Highest Rate (APY) | Where? (Click link for Full Rate Sheets) |
| Vanguard Daily | 0.09% | Vanguard Prime Money Market Fund |
| Vanguard Tax Exempt | 0.11% | Vanguard Tax Exempt Money Market Fund |
| FDIC Daily Savings | 1.40% | Best Savings Account Rate Survey |
| 6 Month CD | 1.23% | Aurora Bank |
| 1 Year CD | 1.55% | Sallie Mae Bank & 1.50%@ Discover Bank |
| 1 Yr US Treasury | 0.29% | US Treasury Rate Quote |
| 18 - Month CD | 1.71% | Aurora Bank |
| 2 Year CD | 2.00% | Stonebridge Bank & Bank of Internet USA |
| 3 Year CD | 2.50% | newDominionDIRECT |
| 4 Year CD | 2.92% | Bank of Internet USA |
| 5 Year CD | 3.06% | Astoria Federal Savings Bank |
| 5 Yr US Treasury | 1.83% | US Treasury Rate Quote |
| 7 Year CD | 3.51% | Pentagon Federal CU aka PenFed |
| 10 Year CD | 3.50% | Discover Bank |
| 10 Yr US Treasury | 3.04% | US Treasury Rate Quote |
With rates so low, banks will try to sell you their annuity products. Make sure you read my article: Beware of Annuities
Historical CD Rates:
Click charts to see full size images
Related information:
Historical CD Rates:
Click charts to see full size images
| 1-Month CD Daily Chart |
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| 6-Month CD Daily Chart |
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Related information:
I've heard Bob talk about annuities over the years, and am curious about your thoughts. I understand that extreme caution should be exercised with these. Our situation is that my wife does not currently have access to an employer-provided retirement plan, and we make too much to have access to any tax-advantaged retirement account. If we're looking for a good vehicle for her to save for retirement, does an annuity of some sort make sense, or are there other options we should look at? Thanks!
ReplyDeleteAndy
ReplyDeleteThe two of you can put away $20K a year in iBonds ($5K paper + $5K online per SS#) which will give you tax deferral plus inflation protection. See iBonds: Current Series I Bond Rates
Call any of the major fund families, Vanguard, Fidelity, Schwab, etc... and ask them about their SEP IRA plans for self employed people. I've know some HNW (high net worth) high income people who've put away as much as 40% into these. Not sure this is wise unless you are sure you will be in a lower bracket when you retire.
Otherwise, I'd probably buy index funds, individual stocs, TIPS, CD, etc. and pay the taxes on the income now when rates are low unless you are the one in a million who thinks taxes will go down in the future. 8)