High Interest Certificate of Deposit

CD rates continue to fall, but a few good ones can still be found. Institutional investors are having even a harder time. The feature banks below are generally just taking retail deposits, but who knows maybe you'll get luck.  Give them a call.

Aurora Bank FSB (FKA Lehman Brothers Bank) has a 1.78% for an 18-month CD. They have a 2-star to 3-star rating. And yes, they are trying to distance themselves from their past failures. Thankfully their financials look a lot better than the defunct Lehman Brothers, Inc.

Ally Bank is also out there quite often. The have a 60-Day Early Withdrawal Penalty on their 5-year CDs. The rate is a 2.99%. These means that if rates rise, it won't be too expensive to close and take advantage of the higher rates. If you calculate the 2-year equivalent rate it is well above 2.00% so you end up netting higher than if you go with a straight 2-year CD.

First Federal Bank of the Midwest has a 37-month at 2.75%. They have a 4-star rating. Pentagon Federal Credit Union also has a 3-year at 2.50%. They have a 4-star rating.

Acacia Federal Savings Bank has a 3.20%. They have a 2-star rating. Nationwide Bank has a 3.10% and only a 6-month penalty to close. Ally Bank is supposed to have a 60-Day penalty and their rate is 2.99%. At least they could have made it an even 3.00%.

First City Bank of Florida is on the weaker side of things. They about a 1-star Rating. Of course your deposits are insured by the FDIC up to $250,000 (this is set to expire on 1/01/14). So as long as you keep your principal plus interest balance under the insurance limit, you can't lose your funds. A closure does cost you some time though. They have an 18-month rate at 2.00% and 2.00%s are tough too find on the shorter-term CDs.

Northpointe Bank is another bank that isn't as healthy as its peers. However, they have a nice special. It is a 2Y at has a 2.05%, but after 1-year there is no penalty. So effectively you can get a 2.05% for a 1-year CD. Given that even on the 2-year term, it is hard to find a rate like that, you will have that rate until you decide to close it or it matures.

I've listed Alliant Credit Union before. They are federally insured by the NCUA. The NCUA is basically the twin to the FDIC and follows the same insurance guidelines. Alliant Credit Union has a 1-year CD at 1.75%. The 18-month CD is 2.00%. 2.00% is tough to find on the shorter-term CDs. The 2.2% is for 2-years, 2.50% for 3-years, and 3.00% for 5-years. They have a 3 to 4 star rating depending on whom you ask. Alliant came on the scene a few years ago and has continued to keep their rates quite competitive.

Please verify the insurance, ratings, and rates with an bank or credit union that you wish to make a deposit with.

Chris Duncan is a FINRA Registered Representative. He works for Jumbo CD Investments, Inc., a leading CD research and placement firm.

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