Where You Can Get the Best Interest Rates on Borrowing and Saving

Fixing money issuesWe're just over a week into the new year, and if you're one of the people who resolved to try to get your finances straightened out in 2013, it's time to get rolling.

To help you with one aspect of that comprehensive task, we've assembled some lists of institutions that could give you a leg up: banks and credit unions that are currently paying superior (high) interest rates on your savings, and those that are charging superior (low) interest rates on your borrowing.

Big Payouts (Relatively Speaking)

Nationally, the interest rates paid on money market and savings accounts are averaging a mere 0.1 percent now -- but not all banks are so stingy.

Bankrate.com keeps a running tally of some of the most generous institutions. Here are just a few currently running near the head of the pack:

Bank Interest Rate Minimum to Open
Union Federal Savings Bank 1.05% $2,500
EverBank (EVER) 1% $1,500
Barclays (BCS) 1% No minimum
CIT Bank (CIT) 1% $25,000
ableBanking (a division of Northeast Bank)(NBN) 0.96% $1,000
Ally Bank 0.95% No minimum
American Express (AXP) 0.9% No minimum
FNBO Direct 0.85% $1
Colorado Federal Savings Bank 0.85% $2,500
MetLife Bank 0.85% $10,000

Not-Quite-as-Big Payouts

Credit unions can sometimes offer a better financial alternative for consumers. But because they may not charge as much on their loans, they have less money to pay out on interest on deposits. Still, given that they are nonprofit institutions, it should come as little surprise that quite a few of them out there easily beat the average 0.1 percent payout noted above. Here are a few that Bankrate likes:

Credit Union Interest Rate Minimum to Open
State Employees Credit Union 0.75% $250
Star One Credit Union 0.50% $50
Teachers Federal Credit Union (FCU) 0.50% $2,500
Randolph-Brooks FCU 0.45% $2,500
Tinker FCU 0.45% $10,000
Navy FCU 0.40% $2,500
Visions FCU 0.35% $25
Bethpage FCU 0.35% $500
Logix FCU 0.35% $2,500
United Nations FCU 0.35% $2,500

And Speaking of Charges...

A second survey, just out this month, flips the coin over and offers consumers a few ideas for how to save money by not spending as much on credit card interest.

Nationally, credit card providers charge an average of 9.9 percent annual interest on credit card balances. But in its quarterly update on banks and credit unions that offer lower-than-average rates on their plastic, SNL Financial reveals the 10 banks with the best deals on "platinum" tier credit cards.

Bank Interest rate
First Tennessee Bank (FHN) 5.15%
Hills Bank and Trust 5.25%
Vectra Bank Colorado 5.25%
Farmers State Bank 5.75%
Sunflower Bank 6%
Trustmark National Bank (TRMK) 6.15%
American Bank and Trust Co. 6.24%
Bank of Tampa 6.25%
First State Bank of DeKalb County 6.25%
River Valley Community Bank 6.74%


Good Credit

When it comes to credit cards, the nonprofit, consumer-focused side of credit unions shines through. Because they earmark less money for interest on deposits -- and for paying out to shareholders and executives -- credit unions don't need to charge their customers quite as much interest on their charge cards. Consequently, many American credit unions clobber the national average interest rate on credit cards, and beat the best of their traditional commercial banking rivals as well:

Credit Union Interest rate
Educational Systems Federal Credit Union (FCU) 3.25%
Energy One FCU 4.25%
Sandia Area FCU 4.99%
New England FCU 5.15%
San Francisco FCU 5.15%
Beach Municipal FCU 5.24%
Red Crown FCU 5.25%
TruService Community FCU 5.25%
Randolph-Brooks FCU 5.70%
Apple FCU 5.74%

Do you know of an even better deal than the ones named above? Tell us in the comments section below! With 2013 just begun, there's plenty of time for us to save some money this new year, together.

Motley Fool contributor Rich Smith is currently researching credit unions that offer online stock investing as well as great rates on savings and credit cards. If you know of one, drop him a line.

The Motley Fool recommends American Express Company
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button.eyes

Also needs to mentioned in order to get best rates keep your credit history clean. if you find negative info remove it. Obviously the most important thing you must do is go to a reputable and established credit repair company. I know there are many out there but I think Lexington Law is proabably the best because of how long they have been in business (20 years) and that they get results.

January 23 2013 at 8:11 PM Report abuse rate up rate down Reply
1 reply to button.eyes's comment
chris.markus

Great advice. I actually googled them. Lexington Law has helped clear more more than 2,500,000 wrong credit results from people's reports. One of the most reputable ones out there.  Lexington's website has a lot of information to help folks eliminate debt 

January 23 2013 at 8:23 PM Report abuse rate up rate down Reply