bank rates

Wilshire’s Savings Plans Keep Beating CDs

Wilshire State's Rainbow Savings Plans

If you can deal with all of the rules, you’ll still have a tough time finding a better return than Wilshire State Bank is offering on its Rainbow Savings Plans.

This installment savings plan requires you to choose a goal of $1,000, $5,000, $10,000 or $20,000 and decide how much time you want to reach that goal, from 12 to 36 months.

You then deposit a fixed amount into the plan each month, and collect your goal after the final payment has been made. The amount you receive includes your deposits and the interest you’ve earned on that savings.

The interest rate depends on the length of the plan — longer plans earn higher rates — and how the payments are made.

If the money is taken from a Wilshire State checking account, you’ll earn about a quarter-point more than if you have it automatically deducted from an account at another bank (although Wilshire will do so at no extra charge).

You can currently earn anywhere from 2.28% APY for a 12-month plan with the payments taken from another bank, to 3.30% APY for a 36-month plan with payments taken from a Wilshire account.

That’s about a half-point less than these plans were offering two months ago. But the returns continue to beat the best nationally available rates on 12-, 24- and 36-month CDs.

Here’s a chart from Wilshire State that details how much you’d earn, and how much the monthly payments would be, for plans with payments being taken from another bank:

Wilshare Rainbos Savings 2

Wilshire State has 23 branches in California, Texas, New Jersey and New York. But Rainbow plans can be opened online and are available to savers nationwide.

For those of you who’ve been asking, it has a solid 3 Stars from Bankrate’s “Safe & Sound” rating system.

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Comments (6)
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6 Existing Comments
  1. DealMaven said:
    on July 13th at 10:31 am

    We’ve checked all the rates on the CD Leaderboard For July 12 and they’re still good this morning.

  2. Amy said:
    on July 15th at 02:43 pm

    Interesting but confusing. Let’s do the math.

    Let”s say if I want to do a 12 month, $10,000 contract amount CD (without automatic transfer), is $82.35 the monthly amount I need to pay? $82.35 x 12 = $988.2. What does the difference 11.8 mean? Am I getting 1022.8 (prinical plsu interest) after one year?

  3. DealMaven said:
    on July 15th at 04:21 pm

    No. If you do a 12-month, $1,000 contract (I assume that $10,000 thing is a typo), without automatic transfer, you’d put $82.35 into the account each month. At the end of the year you would have deposited $988.20. But you get back a nice even $10,000, having earned $11.80 worth of interest.

    Remember, you can’t calculate how much interest you’ll earned based on the final total of $988.20 because that amount hasn’t been on deposit the entire year. For the first 11 months, you have far less than that in the account. It’s not like a CD where you put all the money in at once. The balance builds over time.

  4. Amy said:
    on July 16th at 01:08 am

    so it is more like a zero coupon bond or bond priced at discount?

  5. Jose said:
    on July 18th at 01:12 pm

    What BS…Are they taking a page from the Wall ST flim-flammers? Sounds like a Chinese Restaurant Menu for deposit…

  6. DealMaven said:
    on November 15th at 04:49 pm

    Wilshire Bank still offers the Rainbow Savings plan, but the top rate you can earn is 2.79% APY for 36 months — not the 3.30% APY that is shown above. And to get the highest rate you have to use automatic transfers from the Wilshire State Bank deposit account.