It pays 0.95% APY whether you invest $1,000, $10,000 or $100,000.
That’s well below the national average of 1.57% for two-year CDs and comes from the latest acquisition of Wells Fargo & Co. — the big San Francisco-based bank that delighted Wall Street this week when it reported earning $3 billion in the first quarter.
The Dow Jones Industrial Average soared nearly 250 points and Wells’ shares rose almost 32% on Thursday.
But should we be all that surprised when the Federal Reserve is flooding commercial banks with cheap money — and allowing them to pay savers such shockingly low rates?
Take a look at this chart we pulled from Wachovia, the Charlotte, N.C.-based bank Wells Fargo took over in January.
Every certifcate of deposit it lists pays less than 1%, including that 24-month CD with a minimum deposit of $100,000.
No wonder Wells Fargo said “strong operating results” at Wachovia helped boost its profits.
Bottom line: Don’t even consider buying a standard-term CD (such as the 6-month, 12-month, or 24-month CDs above) from Wachovia. You’ve got to take advantage of the specials on odd-term CDs.
They may not be the best deals around, but what would you rather have: 1.90% for a 17-month CD or less than 1% for a 12- or 24-month CD.
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