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I have an account at UFBdirect (aka AXOS bank), they pull a sneaky. When they raise their interest rate, they create a new name for their savings account and DON'T change the rate on your existing account. At first I opened a new account and transferred my money from the old account, so I now have 3 savings accounts there. Direct, Elite, HighRate, and now Preferred.

But then I complained why they didn't just increase the existing accounts and they immediate replied that they'd upgrade the old accounts. Great. But a PITA, because you have to go to the main page before logging in to see if they have a new higher rate.
Monday I saw they went up from 4.21% to 4.55%, so I messaged and asked them to upgrade my accounts, which they promptly did. Today (Wednesday) I logged in to verify the upgrade, and WOWSA! the newest rate (which I got) is 5.02%.

I bet that when rates go down, they'll automatically lower it.

CIT just bumped up to 4.20%. Everybody else besides UFB just flat-out updates their rate.

Companies play a lot of games. Some online sites will change their terms of service and then opt you back into promotional emails that you spent time carefully opt-ing out of them.
Wells Fargo (no surprise) once changed something in my accounts and at the end of the year when I was review things found out they were now charging me $10 a month for my accounts. I quickly went to a branch and the manager went back and credited all of my accounts and removed the fee. Then he gave me his direct number. I found that a bit troubling since it seemed like it was indicating I should expect additional issues down the road.

I'm not opposed to opening some accounts online to get higher rates but right now it seems easiest for me just to buy treasuries and avoid trying to find the best rate. I keep some in Marcus which certainly doesn't have the highest rates but more so than WF. I'm looking to moving some of my banking to Fidelity or Schwab and get away from WF.

I don't know if Schwab has changed its policy, but they do not automatically sweep your bank cash into a money market. Fidelity does, however. Schwab will keep your cash in the their "bank sweep," offering less than 1%. You need to buy the money market separately. That's how Schwab made so much money last year. Banking on ignorance.

Rayvt,

How about the cash waiting in an IRA account like TD-Ameritrade?

The interest rate on swaps is a jock.

Thanks

I think banks are a terrible place to keep cash in any event beyond enough to cover monthly expenses and for planned expenses two-three months out.
I'm with Wells Fargo because I have my mortgage with them and that and my checking account and savings account linked, which gets all my monthly fees waived. Money that gets transferred into my savings account gets transferred back into my checking when the savings account has grown to a low amount determined by me.

I'm looking at a local credit union for when I finish paying off my mortgage.

Eric Hines

CIT Bank used to do that as well, I had a string of accounts to take advantage of higher rates. Lately though they seem to be auto-updating, so I guess people constantly opening new accounts and closing old ones, and complaining about having to do that, finally got through to them.

Brian

Wells Fargo---They kept sending my wife credit card offers. When they started offering $200 bonus and 18 months zero interest, we took it. To get the bonus you have to spend $1000 in 90 days. No problem, I simply pre-paid $1000 on the electric bill. Shifted a few of our regular large-ish bills to the WF card, and she uses that card exclusively. Making the minimum payments now, will pay it all off just before the zero interest period expires.
Effectively making ~4% on the money. PLUS 2% cash-back.

I looked at opening checking/savings account at WF, but looked at the fees and rates and threw up a little bit. Plus, after the shenanigans with ghost accounts, I'd stay far away from those.

Now they are sending me the same offer every few weeks. Will probably take it when hers is up.

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I think banks are a terrible place to keep cash in any event beyond enough to cover ....
I'm looking at a local credit union for when I finish paying off my mortgage.

Why local? And why limit yourself to just one? And why wait until after the mortgage?

Alliant CU in Chicago pays 3.10% on savings account, they also have checking & credit card. Fun fact: Alliant CU used to be United Airline CU. Plenty of on-line banks pay 3.6% to 5.02%. We have (free) checking accounts at 3 local brick-and-mortar banks & credit unions, keep about $1000 in each one. In general, B&M banks pay terrible low interest rates. Online banks & CUs pay much more.

People always ask why go to the bother of having multiple accounts, it's so much simpler to have just one bank. The recent events show why you should have your money at more than one place.

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I don't care much about broker sweep accounts. If I plan to buy stocks soon, the money doesn't stay in cash but a few days. If I plan to stay in cash for a longer term, I put it in short-term ETF or mutual fund like FLRN or VUBFX.


Ooooh, Marcus Bank, that's a new one to me. Looks pretty good, 3.75%

Wells Fargo... usw....

I've been with Wells for decades, never had any problems with them, including not a hint of the bogus accounts fiasco. Always good customer service, too, on those rare occasions I've needed it (in any event, what's the value of top drawer customer service if you have to use it frequently?). I do get "attractive offers" brochures from the local branch's loan officer congratulating me on the progress I've made paying down my mortgage, and offering me a "truly marvelous" rate on a home equity loan, or a line of credit, or a.... "Call me for details." It's mildly useful to see the rates he's offering, and then the offer goes into our recycling bin.

I also don't go chasing yield, so I don't go chasing after high interest rates--if they're too high, it's a sign the company offering them is in trouble. In an environment where interest rates are spiking (and will fall just as sharply on the back end), anything higher than what I get from my preferred stock coupon rates is getting too high, and anything less than that isn't worth my time.

Why wait 'til my mortgage is paid off? I think banks are a terrible place to keep cash in any event beyond enough to cover....

Since I don't keep much cash in the bank, I don't have enough to be worth the effort of diversifying. Nor is there enough cash to be worth going after the chump change even reliable CU rates would produce.

Eric Hines

I don't care much about broker sweep accounts. If I plan to buy stocks soon, the money doesn't
stay in cash but a few days. If I plan to stay in cash for a longer term, I put it in short-term ETF
or mutual fund like FLRN or VUBFX.

Not sure what the problem is with broker sweep accounts.
Interactive Brokers (one of the brokers I use) currently
pays 4.33% on long-settled cash balances. And if some of
the money is needed for other purposes, I have always been
able to transfer it to a bank account the same day (have
not tried transferring on weekends).

If one can watch patiently, as on a tree branch (or clutching it
like the vultures that patient investors happen to be),
then the wait for the prey to appear is much more tolerable,
and even enjoyable when earned interest salves the urge to
"do something" with that unused cash. Probably more than a
few would have preferred to have been balancing on that tree
branch in 2022, earning interest while scanning the horizon
for opportunities.

vez

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