Citizens Bank is now offering a new checking account called the Star Rewards Checking. It pays 5.61% APY on balances up to $25,000 Balances over $25,000 earn 1%. Its almost the same model as City Bank’s Reward Checking and Legacy Bank’s Win/Win Checking. The basic model is that you’re rewarded with high yield checking account in exchange for direct deposits, 19 debit/check chard transactions per month and receipt of electronic statements. Another perk is the automatic reimbursement of all ATM fees.

These checking accounts can be a great deal if you can get in the habit of making those 10 debit card transactions per month. The 5.61% APY on this account makes this an especially good deal. According to the CSR, this is not an intro rate although like any checking or savings accounts the rate is variable and could change at any time. I was told that no hard credit pulls are done; only ChexSystem is used when you open this account.

The CSR stated that you must visit a branch to open an account. Branches are located in serveral cities of Alabama, Tenessee and Mississippi.

This bank is federally insured by the FDIC.

Austin Telco FCU has some of the highest cd rates on its long term share certificates. The jumbo CD’s have the best rates which range from 5.61% APY for a 24-month CD to a 5.82% APY for 60-month CD. These do require a minimum deposit of $95,000. The rates for a CD with a minimum deposit of $1,000 ranges from 5.51% APY for a 24-month CD to 5.67% APY for a 60-month Cd. The early withdrawal penalty is 180 days of interest. These are also available in an IRA.

Highest CD Rates

Austin Telco is open to anyone living, working, worshiping or attending school in Austin’s five county Metropolitan Area.

The credit union is NCUA insured. It has $427.5 million in assets and about 60,000 members.

Highest Certificate of Deposit rates are not uncommon on Internet banks. Tucoemas Federal Credit Union is still offering there many high yield long-term share certificates. They include a 6.22% APY 60-month CD, a 6.11% APY 30-month CD and a 5.80% APY 24-month CD. These have a $50,000 minimum deposit requirement. Slightly lower rates are avaliable with the $10,000 and $2,500 minimums. Even with only a $2.500 minimum, the 60-month CD still has a 6.06% APY. A 30-month IRA share certificate with an 6.01% APY is still availabel with a $10,000 minimum.
the field of membership includes those who live, work, worship, or attend school in Tulare County, California. Branches are located in Visalia, Tulare, and Porterville, California.

This credit union is NCUA insured. With $183 million in assests and 37,440 members.

Countryside Community FCU is now offering a special 5.80% APY 24-month certificate. The minimum deposit is $10,00 or $1,000 for those with an existing Countryside checking account. This is a December special which replaces the 5.75% 48-month and 5.75% 12-month CD rates specials.

The field of membership includes those who live, work, worship or attend school in Onondaga County, New York. The credit union is located in East Syracuse.

Countryside Community FCU is federally insured by the NCUA. It has 6,371 members and $88.6 million in assets.

CINCO Family Financial Center Credit Union has very nice December certificate specials. These include a 5.75% APY 30-month CD, a 5.65% 20-month CD rates and a 5.50% APY 10-month Certificate of Deposit rates. The minimum deposit is $500, and these are one of the highest cd rates in the nation.

The field of membership includes those who live, work, worship or attend school in Hamilton, Butler or Clermont County, Ohio. See the site for more details. Branches are located in Cincinnati, Ohio and Lawrenceburg, Indiana.

The credit union is federally insured by the NCUA.

Los Angeles Firemen’s Credit Union is now offering a 4 month 6.70% APY IRA certificate of deposit rate. New money is required.

The field of membership includes active and retired full-time, paid, professional firefighters within the State of California. See the site for more detials. The main office is located in Pasadena, California.

The credit union is not federally insured by the NCUA. It is privately insured by the ASI. You can also confrim that they are in the ASI’s database here.

Federal Reserve vice-chairman Donald Kohn has warned investors not to underestimate the central bank’s inflation concerns. He has even challenged the wagers of some traders that certificate of deposit interest rates may be cut.

Mr. Kohn delivered a speech in a gathering of economists and money managers in New York on Oct 4. He said that he is more worried about persistent inflation than a slowdown in growth. He added that that the economy is likely to avoid recession and that a pickup in prices would warrant borrowing costs. He said, “Further upward movements in inflation would be very adverse to the economy and would, I think, require policy actions.”

The views expressed by Mr Kohn are odds with speculation that a housing slump will prompt a cut by early next year. According to Fed chairman, Ben S Bernanke, the US property market is in a “substantial correction” that will lop about a percentage point off economic growth in the second half and restrict expansion next year.

The effect of Mr Kohn’ s speech was seen as US 10-year Treasury notes fell in Asian trading on Oct 5. However, stocks in Asia rose after Mr Bernanke’s remarks. Mr Bernanke has also mentioned persistent inflation as a risk, though some traders interpret the Fed chairman’s comments as consistent with a possible rate cut and pushed stocks higher.

In his speech, Mr Kohn said, ”The risks to my outlook for economic activity may be skewed to the downside, while those to my forecast of gradually declining inflation are tilted to the upside. In the current circumstances, the upside risks to inflation are of greater concern.” According to him, the current overnight lending rate level of 5.25% has the best chance of promoting a so-called soft landing. He expects that the economy will continue to slow before picking up and falling oil prices would allow consumers to spend more.

With a very stronger than expected job report released today, we may see a lowdown in the trend of falling CD rates. It seems that the funds rate will stay at 5.25% at the next Fed meeting on December 12. If a strong job growth continues, this could lead to rising wage inflation and maybe a return to the rate hikes in 2007.

From history, it looks as if we are at the peak in the certificate of deposit rates cycle, and with long-term CD’s continuing to fall, perhaps it’s a sign to lock into some high yield long-term CD’s. IF you do lock into some long-term CD’s, be sure to check on the early withdrawal penalties. If the conomy surprises the banks and contiunes the growth, we could see high cd rates come back again by next year. If the early withdrawal penalty is small enough, it may be worth it to break the CD and jump on the new offer. The average penalties for long-term CD’s tend to be a 6-month of interest. A 3-month penalty is sometimes available. Becarefull for those who penalize you for half the CD term. That can be 30 months of interest on a 5-year CD rates.

It appears that UFB Direct intends to remain the rates leader for a non-minimum savings account. Yesterday they raised the rate of High Yield Money Market Savings Account from 5.28% to 5.32% APY. This just beats the newcomer, iGobanking which launched its no-min online savings account last week with a rate of 5.30% APY.

LBS Financial Credit Union has serval certificate of deposit rates specials. The one with the highest cd rates would be a 5.75% APY 13-month CD with a minimum deposit of $90,000. Lower rates are available for smaller deposits. An APY of 5.50% would be for a $2,500 minimum deposit. The credit union also has 7-month CD’s with a maximum cd rate of 5.50% for a $90,000 deposit. The special share CD rates allow an additional one time deposit of $1,000 or more during the certificate term.

The field of membership includes those who reside,work, or have an immediate family member who lives or works in Orange County or Riverside County, or in one of several cities in Los Angeles County. The credit union is also federally insured by the NCUA.