As I slowly creep towards a simplified personal finance system, I take aim at an account that has treated me fairly well over the years – my Dollar Savings Direct high yield savings account. Dollar Savings Direct used to have extremely good rates back in the day but the years have not been kind to the online arm of the NY-based Emigrant Bank. It’s taken me this long to close the account because I had a pair of 16-month CDs waiting to mature (the last of which matured this month) and it was only a matter of time before the account got the axe.

Closing an account at Dollar Savings Direct can be completed entirely online, though their website doesn’t explain how, and is pain-free. (as an aside, their customer service number goes directly to a human being, so calling is easy too but you can’t close an account over the phone)

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These days, the best way to help your savings grow is by saving it in an online high-yield savings account. With interest rates as low as they are, you simply can’t get anything by putting it in your neighborhood bank. Online banks, with lower overhead, are still the best place to earn a much higher yield with absolutely no risk. After years of managing this list manually, we’re now happy to offer up this table that is updated daily with the highest rates you can find anywhere. The table is powered by Bankrate, an industry leader, and hundreds of banks are surveyed each time to ensure that the highest rates are displayed. Lastly, all of the banks on this list are FDIC insured so you know your money is 100% protected.

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How much money do you have sitting in a savings account? $500? $1,000?

Do you have plans for that money? If not, it should be in a certificate of deposit at your bank. If your bank doesn’t offer good CD rates, then you should open a CD with an online bank and take advantage of their better interest rates. If you don’t think you have enough money, you’re wrong. You can open a CD at an online bank with a single dollar.

One dollar.

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One of the things I learned whenever I drew up our financial network map was that I had a lot of bank accounts, mostly high interest savings accounts at online banks. FNBO Direct, Dollar Savings Direct, HSBC Direct, ING Direct, and E*Trade for starters and that was after we closed accounts at Emigrant Direct and Virtual Bank.

There are many reasons why I have so many bank accounts, and I’ll explain that some other time, but the point of this post is that it’s easy to forget the big picture whenever you’re dealing with the nitty gritty of daily affairs.

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I’ve been emailing back and forth with reader Tomas (he’s the impetus for the Bargaineering VideoCast that will be published on Sunday), and one question I struggled with was which online bank has the best high yield savings account offer now?

In the last few months, interest rates have plummeted. It was only a few short months ago that Dollar Savings Direct offered 4.00% APY on their savings account. Now the rate is half that, a mere 2.05% APY. FNBO Direct, a long-time favorite of mine, just lowered their rates yesterday to under 2%. ING Direct, HSBC Direct, and E*Trade Bank all have rates under 2.00% and have had rates that low for quite some time.

So which one is the best? For me, it’s any of them. The difference between 1.50% at ING Direct and 2.05% at Dollar savings is microscopic. Half a percent isn’t worth the hassle of opening up an account, to be honest, and my money is going to whatever account makes it easiest for me to work with them.

How about you? What do you consider the best high yield savings account nowadays?

(Photo: refractedmoments)

After closing my Emigrant Direct account last week, I figured I’d add to my paperwork and open up a new bank account! This time I turned to a bank I’ve talked about in the past but never dealt with personally – EverBank. They have all the characteristics I look for in an online bank – FDIC insured, competitive interest rate, and informative website. They’ve been been in business for many years, as a mortgage lender, before they started taking deposits in 1998 (when they were FDIC insured). Since then, they’ve won a ton of awards such as Money Magazine “Best of the Breed” in 2007 and Kiplinger’s “Best Checking Account” in 2006. Most importantly, they don’t appear to be too affected by the credit crisis… all good things, so I opened an account today.

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After sixteen months of sitting in carbonite, the funds in my Emigrant Direct MyWay CD matured and I withdraw the last of my funds from Emigrant Direct. Ever since I discovered that Dollar Savings Direct was the same as Emigrant Direct, except with a much higher interest rate, I’ve been putting all my funds there. Fortunately, the Emigrant Direct MyWay CD was yielding me a fat 4.50% APY for the last sixteen months so I wasn’t complaining too loudly. Now that it had matured, I was ready to close the account because it had outlived its usefulness.

One minor bit of advice, Emigrant Direct compounds interest daily but credits your account monthly, so I would wait until the start of a new month before transferring out assets and requesting closure.

1. Transfer all of your assets to your external bank account.
2. Click “Customer Service” and send customer service a message that you’d like to close your account. My message was a succinct “I would like to close all of my accounts.”
3. Wait.
4. The next business day, they’ll send you a message within their internal system notifying you that they’ll be closing your account.

Here’s the message I received one day later:

Dear JIM, Thank you for contacting Emigrant Direct. While we are disappointed that you will be closing your account with us, it is our pleasure to assist you. We have received your request to close your account. Please allow 1 to 2 business days for your request to be processed. If you have any questions, please do not hesitate to contact us at 1-800-836-1997. We are here to assist our customers seven days a week from 8:00am to 11:30pm Eastern Time. Once again, thank you for contacting us and we are sorry to lose you as a valued customer. Sincerely, Kim P.

And just like that, account closed!

If you’re looking for the best CD rates, you’ve come to the right place. Below is a list of the nationally available best CD rates, updated every single day. I looked at the best rates available for CDs of less than 18 months and listed the ones with the highest rate. Typically the longer the term, the higher the rate, but for many online banks the best rates were for periods of shorter than 18 months. For simplicity’s sake, I put the cutoff at 18 months (some banks offer higher rates for longer terms). If you want shorter term CD rates, I have also compiled a list of highest short-term CD rates (less than 12 month maturities).

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