Deals of the Week: Feb. 3
By: Brian O'Connell

Foraging for decent bank deals these days is like panning for gold in your bathtub — it passes the time but you’ll be more disappointed going out than you were going in.

OK, we’re half-kidding. There are some good bank deals out there but they’re really beginning to thin out. Many banks are cutting the rates on certificates of deposit and bank savings and checking accounts. So last year’s 3% CD rate is now this year’s 2.5% CD rate — if you’re lucky.

Of course, the primary reason is the lousy economy. The federal government says it must borrow $1.6 trillion in 2010 — that’s approximately $15,000 for every U.S. household. Our national debt burden, according to Washington think tank the Heritage Foundation, is expected to total $8.5 trillion over the next 10 years.

Economically, that’s a house that cannot stand and banks know it. Why should they offer a 3.5% short-term CD rate when 10-year U.S. Treasury yields are down to 3.65% these days? Even 30-year U.S. Treasuries are only yielding 4.57% this week. With long-term bond rates that low, banks aren’t about to give away the store.

So let’s not sugarcoat it, the bank rate landscape these days is a bleak one. But that said, there are some diamonds in the rough and sbup is committed to finding them for you.

Bank CDs

Ally Bank has an interesting deal on bank certificates of deposit.

This week, Ally is offering two-year CD customers an “upgrade” in the form of a higher rate once you see the CD “reset” to a higher rate during the term of that CD.

The Ally Bank two-year CD rate is at 2.1% right now, and that’s very competitive since the national average for similar CDs, as measured by the sbup Weekly CD Rate Tracker, is at 0.85%.

But let’s say that Ally moves the CD rate up to 2.25%. Then, Ally gives you the opportunity to reset your rate from 2.1% to 2.25%, without any paperwork or reworked applications.

You only get to exercise the reset option once, but it’s still a handy feature. Plus, it pairs nicely with Ally’s 10-Day Best Rate Guarantee, where a new CD customer gets the absolute best CD rate within 10 days of opening the account.

Find out more here.

Bank Checking

At the top of this article, we mentioned that banks were increasingly cutting back on bank deposit rates as the economy continues to send weaker signals to financial institutions.

EverBank is on that list, but the good news is that, at 2.25% for its three-month signature money market and checking accounts, the rate still easily surpasses the national average for national bank checking account rates. According to the sbup Weekly Interest Checking Account Tracker, the average U.S. checking account is paying out a paltry 0.135% this week.

Of course, last July, Everbank was offering bank customers 3.01% APY on its checking accounts (for a three-month promo rate) and a 1.85% APY for its Yield Pledge Money Market Account. Now, the money market rate is down, as well, to 1.26%.

But in a weak interest rate market, you take the deals where you can get them. And right now, Everbank is still offering one of the best bank interest rate deals around.

The Web site has the most current details. Get them here.

Credit Cards

Citi (Stock Quote: C) is out with a credit card for the customer who needs to transfer a high-interest rate balance over to a new card with a better rate.

A much better rate.

That’s the deal with the Citi Platinum Select Card, which offers a 0% APR on purchases and balance transfers for up to 12 months, with an 11.99% APR thereafter (providing you have sufficient credit for Citi — likely a FICO score of 700 or more).

The card also offers zero liability on unauthorized purchases, and you can qualify for online discounts on the Citi Web site. Note that the 0% APR does not apply to cash advances, and that the rate will rise if you, as the Citi Web site puts it, “pay us late, go over your credit limit, or have a returned check”.

Apply online here.

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