Ask The Money Coach

Want to know which banks consistently offer the highest savings rates? Look no further than MoneyRates.com, which just released its latest America’s Best Rates quarterly survey.

The survey identifies and ranks the U.S. banks paying the highest interest rates on savings and money market accounts throughout the entire third quarter of 2011 – as opposed to simply identifying banks that offer one-time “teaser” rates to attract new customers.

And even though Bank Transfer Day came and went on Nov. 5, 2011, many people are still considering switching banks or opening new accounts, making the results of the MoneyRates.com survey even more timely and important to consider.

Overall, the survey showed that interest rates fell during the third quarter. But that didn’t stop certain banks from offering annual percentage yields (APYs) that were roughly six or more times greater than the national average rates reported by the Federal Deposit Insurance Corporation (FDIC).

According to the FDIC, the national average savings account rate at the end of the third quarter was a paltry 0.12%. By contrast, the average rate of the America’s Best Rates top 10 savings accounts was more than eight times that amount, 0.98%.

Additionally, the FDIC reports that the average money market account is paying just 0.17%. But money market accounts highlighted in America’s Best Rates touted an average rate of 0.97%, almost six times the FDIC-reported average at the end of the quarter.

“These top-performing accounts show that even in a low-rate environment, consumers do have alternatives,” says Richard Barrington, CFA, the personal finance expert from MoneyRates.com. “The key is to find a bank that consistently offers competitive rates.”

According to MoneyRates, here is the list of the banks offering the most competitive interest rates on savings accounts and money market accounts.

Again, this data is based on the average rates these banks offered throughout the quarter, rather than a one-time snapshot of their rates.

The top 10 banks with the highest savings account rates by APY during the third quarter of 2011 were:

1. Discover Bank – 1.12%

2. Sallie Mae Bank – 1.08%

3. Capital One Bank – 1.05%

4. Ally Bank – 1.02%

5. (tie) American Express Bank – 1.00%

5. (tie) ING Direct – 1.00%

7. Cashmere Valley Bank – 0.95%

8. Zions Bank – 0.93%

9. EverBank – 0.90%

10. OneWest Bank – 0.76%

The top 10 banks offering the highest money market rates by APY during the third quarter of 2011 were:

1. Sallie Mae Bank – 1.14%

2. Nationwide Bank – 1.03%

3. Discover Bank – 1.02%

4. Ally Bank – 1.02%

5. Hudson City Bank – 0.96%

6. AIG Bank – 0.93%

7. Zions Bank – 0.93%

8. (tie) EverBank – 0.90%

8. (tie) Mile High Banks – 0.90%

10. OneWest Bank – 0.87%

This list also shows you how competitive the banking environment is, and that it can really pay to shop around when you’re considering various banking and financial services products.

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