Savings Account & MMA Rates
CD (Certificate of Deposit) RatesYou may have heard that Sallie Mae’s getting into the banking business.
But will its new savings accounts and CDs catch on?
First, the yields aren’t that great — and already being cut.
When Sallie Mae introduced its savings accounts in early March, it was paying 1.35% APY. Now it’s paying 1.25% APY.
Although that’s still above an average return, it certainly won’t make it into our rankings of the best nationally available savings accounts, which are paying as much as 2.00% APY.
Second, everyone I know hates Sallie Mae.
As the largest broker of private student loans it’s burdened a generation of college students with more high-cost debt than they can ever hope to repay.
Sallie Mae started out as an arm of the federal government. But when it went private in 1997, it ratcheted up the marketing about how “the college dream” must be attained at any cost.
As college costs soared, a growing number of financially naïve students had to borrow from private lenders to make up the gap between tuition and what they could borrow through Pell Grants from the federal government.
Sallie Mae made sure it got a huge share of that business by more-or-less bribing employees in student aid offices at colleges and universities across the country with all sorts of perks, such as luxurious vacations.
Although it promised to end that scandalous behavior in a 2007 settlement with the New York attorney general, the damage was done.
Hundreds of thousands of students had taken out loans that cost more than they should have and gobbled up such a huge chunk of their income that it’s impossible to save for anything — or even move out of their parents’ basement.
That makes Sallie Mae’s new business more than a little ironic to all of those students and their families struggling to meet their monthly payments.
If the returns are ever good enough to crack Bankaholic’s rankings of the best savings accounts or CDs, they’ll be included.
But I’ll understand if you give us crap for it.
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