You may have noticed that I cover no-penalty CDs pretty closely. That’s because I think they’re a relatively unknown and under-appreciated type of deposit account that represents the best of both worlds: It’s essentially liquid, like a savings account, but it has a deposit term that works for you instead of against you, guaranteeing your rate for a fixed period of time. CIT Bank is one of a very small number of rate leaders in the no-penalty CD space, so I follow what they do.
In an interesting and, as far as I know, unprecedented move, earlier this month CIT Bank introduced a new liquid savings account that potentially beats their own no-penalty CD. It’s called Savings Builder and it comes with 2.15% APY for accounts that meet either of two qualifying criteria on an ongoing basis:
- You have have a balance of $25,000 or more or
- Your Savings Builder account receives at least one deposit of $100 or more during each evaluation period.
If you fail to meet either of those criteria for an evaluation period, then the Savings Builder earns at 1.14% APY. In contrast, CITs own 11-month, no-penalty CD earns just 2.05%, but requires only a $1K opening deposit. You can go here to read all of the timing details about qualifying for the upper tier rate during evaluation periods.
You can get started with a new Savings Builder account by depositing as little as $100. Until the end of your first full month, you’ll earn the 2.15% rate, but by the following evaluation period you’ll need to meet one of the aforementioned conditions to continue earning that upper tier rate. Otherwise, you’ll earn just the 1.14% APY until once again meeting one of those conditions.