While it remains possible for banks to borrow cheaply from the Federal Reserve Board, those institutions still have no incentive to offer private customers more attractive CD rates. Given today’s low CD returns, although the customer is hard pressed to find outstanding bargains, they can still profit by shopping around and comparing what their local banks are offering.

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How to Get a Better Deal

The CD deal you get varies according to the length of the period over which you are willing to deposit your funds and the amount of money you have to deposit. Understandably, banks will offer better rates for larger deposits over a longer period, but whether you want to tie up your funds for five years or more depends on your feelings over what is going to happen to shorter term CD rates. If CD rates are expected to rise significantly in the future, you are not going to be able to take advantage of this opportunity if you have tied up your money in a long-term CD.

Garden State Rates

If you are willing to shop around, New Jersey has some great CD rates. ING Direct and Hudson City Savings Bank dominate the best CD offerings right now, as shown in the following table:

Bank Name   CD Term (months)   
6 mo.12 mo.18 mo.24 mo.36 mo.48 mo.60 mo.
OneWest Bank1.55%---------2.50%2.75%3.40%
Hudson City Savings Bank1.40%1.75%2.00%2.50%3.00%3.25%3.50%
Wilshire State Bank1.51%1.75%---------------
Stonebridge Bank1.30%1.65%1.80%2.00%2.40%---2.65%
Intervest National Bank1.05%1.65%1.80%2.20%2.74%3.10%3.27%
Valley National Bank0.75%1.25%1.50%1.75%2.50%2.75%3.00%
Investors Savings Bank---1.25%2.00%2.25%2.50%2.75%---

If you have some money lying around that you don’t think you’ll need for the next year or more, Hudson City Savings Bank is offering the highest rates across the board for CDs with 12 month terms or longer.  However, OneWest is offering a great 1.55% APY 6 month CD, if you have the feeling that CD rates are on their way up and think you might want the option to reevaluate and switch to a different CD after 6 months, or if you just want to be able to access your money again sooner.

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