When doing research on savings and CD accounts, you’ll see the term “fixed rate”. Rates are usually variable since the financial markets and money value are always fluctuating. However, to entice new customers, banks will often offer a fixed rate savings account or CD account for a limited period of time, which could be anywhere from 2-months to 1-year.
Since more financial institutions and banks are starting to enter the online high-yield savings game, they are really going all out and trying to outdo each other by offering the best account features possible, combined with high interest rates. They know that they have to try and keep new customers for as long as they can and the best way to do that is to promise a fixed rate.
A fixed rate can also be a term used to refer to the interest rate you’ll have to pay back on a loan or credit card. In this instance, you would want the fixed rate to be as low as possible, and to keep it that low for the duration of the repayment period.
If you have some money and you simply want to put it in an online bank, here are a few of the best banks offering a fixed rate savings account right now (as of May / June 2020):
Marcus by Goldman Sachs
Get either a 1.30% APY with a savings account or a 1.35% 1-year rate with a CD account. All of the deposit products are FDIC-insured and provided by Goldman Sachs bank, USA.
Live Oak Bank
This bank is also currently offering a 1.35% rate for at least a year. There are no monthly maintenance fees to worry about, and you can manage and access your account online or by using the mobile app.
Capital One Bank
The CD accounts have a guaranteed fixed rate return ranging from 1% – 1.30%, depending on how many years you agree to keep your money in. The options are 1-year online CDs (1.00%), 3-year online CDs (1.20%), and 5-year online CDs (1.30%).
This is definitely a great choice of a bank to start an online account with. There are numerous options for accounts, such as a Savings Builder, CD, Premier High Yield Savings, and more. Its No-Penalty 11-month CD is something to consider. It offers both flexibility and security and you are guaranteed a fixed rate (currently 1.20%). However, there is a $1,000 minimum requirement. If you don’t have that much, then look into the other savings and CD options.
These are just some suggestions of where to look when trying to find a good, fixed rate savings account. Make sure you read the terms and conditions carefully.