Home > Banking, Saving > Emigrant Direct rate drops to 4.55%

Emigrant Direct rate drops to 4.55%

January 11th, 2008 Sphere: Related Content

Emigrant Direct has preempted any fed rate cut Bernanke could throw at us. Within the last couple of days, Emigrant bank has cut their online savings rate to 4.55%. Still better than I can get at Bank of America, but it’s making online savings accounts look less appetizing when compared to Canadian Royalty Trusts.

Sure, the money is guaranteed at Emigrant, so it’s still a great place to stash emergency funds, but the dropping rate could offset some of the risk in investing in stocks.

Question for the day: At what percentage rate do you quit stashing free cash in the savings account and contribute it to a online trading account?

The last I checked, RYPQX was still paying just shy of a 5% return.

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  1. jon
    January 11th, 2008 at 10:00 | #1
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    What are your thoughts on tax-exempt MM funds? I have one at Vanguard and have been very pleased. For those in high tax brackets, from what I can tell, they regularly outperform the highest netting savings accounts – in 2007 it returned 3.58%.

    I don’t know if they are available for every state, and granted I live in NY so my tax rates are higher. But I generally pay about 36% total in tax, making that 3.58% worth nearly 5.6% in a taxable account. Now it’s down to 3.02%, still significantly higher (for me) than the Emigrant rate.

    Is there any flaw in my logic? Thanks.

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