bank rates

The CD Rate Chase Continues

hand catching coins falling from aboveBankaholic recently featured a post about the above-average CD rates offered by Alliant Credit Union.

Although I agree with everything said in that post, as the owner of several CDs maturing at Alliant this summer, I can offer a personal perspective – a view from the trenches, so to speak.

Back in 2011, attracted by its rates, I began throwing money at Alliant, opening a number of 2-, 3- and 4-year CDs.

This, as I’ve previously confessed, is my typical M.O.: Find an institution offering top CD rates and deposit as much money as available in the shortest time possible.

Today, with the 2-year CDs maturing, I’m moving my money elsewhere.

It’s because, as our recent post concludes, “there are better deals out there.”

My maturing 2-year CDs boast a 1.70% APY. This was competitive at the time and would be breathtaking today.

However, now Alliant doesn’t offer CDs of any maturity having rates close to that – and which therefore could contribute to my coffers the income I’ve enjoyed over the past two years.

Of course, I’m not blaming Alliant.

The blame rests squarely on the Federal Reserve for its zero interest rate and quantitative easing policies.

I spoke to one of the “advisers” in Alliant’s Investment Services group about my predicament.

I explained that, if Alliant would simply offer me a 4-year CD at 1.61% APY (the present APY is 1.55%), I’d keep my maturing CD money at Alliant. (You see, I’m not greedy.)

He replied that I had no chance of getting a rate bump-up.

He said that, first, Alliant doesn’t offer “loyalty” rewards for CD renewals because it considers its posted rates reasonable and competitive.

Second, like other institutions, Alliant has no trouble attracting deposits. Its problem is lending them out, given the Fed-induced squeeze between short- and long-term interest rates.

I accepted these explanations with equanimity.

And then decided to move my Alliant money into 4- and 5-year CDs at Andrews Federal Credit Union, at 1.71% and 1.91% APY, respectively.

Headquartered in Suitland, Md., Andrews offers CDs nationwide. I qualify for membership because I belong to the American Consumer Council (which I originally joined to buy CDs at Mountain America Credit Union!).

Andrews is far smaller than Alliant, and its online services aren’t as extensive.

But it’s NCUA-insured and has a 4-star Bankrate Safe & Sound rating.

It also offers higher CD rates than Alliant.

And that’s all my money cares about right now.

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