Top CD Rates - Where to Really Find Them

CD rates are pretty easy to research these days, thanks to the internet. Bankrate.com is the place I hear most often, along with publications like Money Magazine that regularly list their top payers. I think these are good places to start, but they usually miss out on the highest paying institutions. Let's look for the highest paying rates as of today, and then I'll tell you where to get them.

Money Market and Savings Rates
A search in Bankrate.com gave me this American Express High-Yield Savings Account, with a 1.30 percent APY as being tops. Granted, I think this is good but my cash is stashed at Alliant Credit Union giving me a nifty 2.00 percent APY. That's more than half again as much. If you need checking access, they pay nearly 1.75 percent APY. It's not insured by the FDIC but is insured by the NCUA, the U.S. Government equivalent for credit unions.

If you go to their site, you'll see that you have to qualify for membership. No worries, if you don't meet one of the other qualifications, you can join the National PTA for a one-time fee of $25.

One year CD
My Bankrate.com search turned up Aurora Bank with a 1.57 percent APY, closely followed by Ally Bank at 1.55 percent. Aurora Bank had a low safety rating and I'd avoid any institution with low ratings, even if it is government insured. Alliant Credit Union again came in at the top with a 2.10 percent APY, followed closely by Melrose Credit Union at 2.07 percent APY. Melrose has no membership requirements.

Five Year CD
Sure, tying money up for a few years is risky, but the risk trade-off is higher rates. Discover Bank tops the Bankrate.com listing at 3.10 percent APY. And Melrose Credit Union tops that by 0.55 percent yielding a 3.65 percent return.

It turned out that all three of these terms had Credit Unions on top. Though I love credit unions, they don't always have the top rates.

Where to get these rates
The single best source I've found for the highest yields is a website called DepositAccounts.com. The name is new but I've been using their predecessor site for years. Bankrate.com does have a separate search for Credit Unions, yet didn't pull up the ones I found from DepositAccounts.com.

I also find high rates from reading my local newspaper and from Google searches. Finally, I have one unique source in that, as a financial planner, my clients and friends like to tell me where they've found something better. In fact, that's how I found a 3.00 percent APY one year CD three months ago as the bank didn't advertise the rate.

Final Advice
I consider these extra yields free money since, as long as you stay below the FDIC and NCUA insurance limits, your money is safe. And to keep it safe, never even think about going beyond these limits as any bank can go belly up. My final word is to never be greedy and go for a yield that isn't backed by the FDIC or NCUA.

MORE ON MONEYWATCH
What's Going on With Ginnie Mae (GNMA) Bond Yields? Is a 3.45 APY CD Too Good To Be True? Annuities and the $100,000 Challenge Should You Refinance Your Mortgage? Maybe Not