bank rates

What A Brutal Year For CD Rates

We won’t miss 2009.

The Federal Reserve’s willingness to provide commercial banks with virtually all the free money they could possibly use had devastating results on savers.

CD rates plunged to record low after record low in 2009 thanks to the Federal Reserve.Banks didn’t need our savings and they spent the entire year slashing interest rates on certificates of deposit.

The average return on 6-month CD rates took the biggest hit, falling by nearly two-thirds over the past year.

But four of the five CD rates we track end the year at record lows. The other rate is only 0.02 percentage points above the record low set in mid-December.

Bankrate’s weekly survey of large banks and thrifts taken Dec. 30 found the average annual yield for a:

3-month CD ends the year at 0.36%, down 0.86 percentage points from 1.22% at the start of 2009. It’s the lowest average since the survey began tracking 3-month CD rates in March 1989.

6-month CD ends the year at 0.50%, down 0.98 percentage points from 1.48% at the start of 2009. It’s the lowest average since the survey began tracking 6-month CD rates in January 1984.

1-year CD ends the year at 0.82%, down 1.05 percentage points from 1.87% at the start of 2009. It’s the lowest average since the survey began tracking 12-month CD rates in October 1983.

2-year CD ends the year at 1.24%, down 0.86 points from 2.10% at the start of 2009. It’s the lowest average since the survey began tracking 24-month CD rates in March 1989.

5-year CD ends the year at 2.10%, down 0.59 percentage points from 2.69% at the start of 2009. The 2.08% reached in mid-December was the lowest average rate since the survey began tracking 60-month CDs in January 1984.

With average rates like this you can’t settle for average returns.

Use our database of CD rates to find and compare the best deals from scores of banks.

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Comments (5)
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5 Existing Comments
  1. Tsunami Cid said:
    on January 1st at 10:38 pm

    Man…depressing…this climate forced me to try my first risky investment of my life (p2p lending)

  2. JTapp said:
    on January 3rd at 03:39 pm

    My local bank still has a free checking account yielding 3.58%. That’s down from 4.08% since January. So, there is (FDIC guaranteed!) yield out there if you can find it.

  3. Merl said:
    on January 9th at 10:27 am

    Sad but true, when the econmony is run by progressives of both poliltical parties this is what happens: deregulation, high unemployment, low interest rates on all types of savings, subprime loans that create high interest rates on credit cards and other loans to finance losses on subprimes; volatile stock market, with seductive short term gains, and dismal long term lows. Despite their political posturing and claiming to be for the poor and the little guy; somehow more money always gets redistributed into the progressive pockets of “the man.”
    So, contact your congresspersons especially those on the house and senate finance committees and complain without relent.The result will be that soon they may be calling you Money Baggers.Your only hope is to vote in representatives who are not progrerssive and are for strengthening the US and its law abiding, hard working citizens. Otherwise, you will continued to hear pretty words, promises and speechs by nice looking people in pretty clothes while you contiune to get screwed. We need a country that is run by sane and rational principles and dominated by inapproprately applied political correctness; else we will remain on our knees as an indebeted and beggar nation before the brual dicatators of the world; without influence or respect; and unable to defend ourselves. There is no longer time to sit back and trust the ones in control to act in our best interest; we must protect ourselves. It is sad but true that sometimes the best interests of an entire nation are sold out for shady back room deals that put more money in the pockets of fat cats. Watch the news, read, keep informed and vote out those on the take.

  4. Merl said:
    on January 9th at 10:45 am

    We need a country that is Not dominated by inappropriately applied principles of PC if we are to become a safe and strong nation. Remember, our enemies always complain and hurl unfounded accusations when we are doing the right thing in order to weaken our resolve and strenghen their cause. This is what is happening with the progressive takeorver of the US encomony; and what is happening in the war against terror. We should therefore never tolerate being called racists if we are doing the right thing; because those callilng us racists are racist; and perhaps even terrorist sympathizers. Life in the political realm is a very tough and endless battle where all of our good virtues, and values are continually under assault; where we are attacked for being competent and right thinking; and where victory never easy; and frustration, struggle and hardship are guaranteed.;However winning is so worth the fight. Engagement strengthens character and resolve. Peacenicks, coasters, and other slackers need not apply. However, if you are not willing to engage you do not have the right to complain when you get taken.

  5. Lawrence said:
    on January 23rd at 08:44 pm

    Merl is sadly mistaken when he refers to “progressives” as the problem. On the contrary, anyone who knows anything about economics knows that from the repeal of the Glass-Steagal Act, the economic deregulation which was the cause of the present crisis was promoted by conservative, corporate interests, NOT “progressives.” The Democrats who supported all this deregulation (including Clinton) may have posed as “progressives” but this is a complete misnomer. I suggest you educate yourself by taking a course in economics at any community college. I teach at one.