Why would anyone do that when regular savings pays 2.2%? For that matter, why would Ally even offer a product that is clearly inferior to another product of their own? Or am I missing something and there’s some benefit to opening a no penalty CD over Savings even when CD pays lower interest? I noticed their 11 month no penalty CD is offering 1.8% for under $5k deposit. This will take you 95% of the way to the bottom of that long page.ģ) Click on 'What types of CD's do you offer?' to expand the offeringsĤ) You can now see all the different types including the 'Promo' ones which they call 'Select CD'. Here is how you can actually see all the rates from Ally, even the promo (Select CD) ones:Ģ) Click on 'FAQs' on the navigation bar near the middle(ish) of screen. The 12-month is a pretty good deal (maybe as good - you get less 0.1% but your money is held for 2 less months). The offer was emailed to folks or you would have had to find it from a site that lists these types of deals:

You probably wouldn't have seen the 14-month CD looking directly on their site. Thanks! Unfortunately I didn’t see the 14 month 2.85% option online so I already signed up for and funded the 12 month CD. I'd rather deal with reinvestment risk than interest rate risk. Yes, the yield curve is pretty flat right now and definitely favors short terms. They might not want to people to lock into longer CDs. (Maybe I’m being cynical)Īt the close today a 2 year Treasury was 2.568% while a 5 year was 2.574%.

One thought I had was, maybe they’re keeping, for example, 18-month CD rate low, because a lot of customers’ 18-month CDs are maturing right now, which will renew automatically for many of them, and Ally doesn’t want to give them a high rate. When I opened a raise your rate CD (2-year term) last year, the rate was better than the High-Interest CD’s. The Raise-Your-Rate CD gives 2.6% for both 2-year and 4-year terms (isn’t it logical that they should be paying a higher rate for a 4-year CD?). When I went on, it shows 2.75% on a 12-month High-Interest CD, whereas it pays between 2.5% and 2.7% (based on how much you deposit) for a 18-month CD (shouldn’t they pay you more for keeping money for 18 months rather than 12?).

Don’t banks usually give you a higher interest rate on longer-term CD’s?

Cd interest rates 2019