Fed Cuts Rate – Dollar Savings Direct Savings Rate Goes UP?

(Rates may be out-dated. Please see the Current APY Wiki for updates)

Can you believe it? This morning the Fed issued an emergency rate cut down to 1.5% (from 2%). While this is not unexpected – Wall Street has been crying and blubbering about a rate cut for a while now – the reaction of Dollar Savings Direct IS surprising.

Instead of dropping their savings rate, which is what tends to happen following the Fed cut, they RAISED their rate from 3.75 to 4% APY. Here are a few highlights of the account:

  • Current rate: 4% APY
  • Minimum required: $1,000
  • Can link up to 2 external accounts

Dollar Savings Direct is a newly-spawned online savings account from Emigrant Bank. I’m still perplexed as to why Emigrant didn’t just raise the rate on their existing Emigrant Direct site instead of creating a brand new division. Oh wait, I forgot about that whole GREED element. You know, that same greed element that’s currently causing our economy to crater?

I’m on the fence as to whether or not I will take the time to open this account. I admit that I sprung for the Washington Mutual 4% offer a few weeks ago, and we saw what happened there. I was only able to enjoy a brief period of high rates before the bank changed names and dropped the savings rate to 3%.

Still, any rate increases are good right now, and I applaud Dollar Savings Direct for raising their rate despite the Fed’s move to punish those of us who keep a chunk of change in savings accounts. I only hope they manage to keep the rate that high for more than a few days/weeks.

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5 thoughts on “Fed Cuts Rate – Dollar Savings Direct Savings Rate Goes UP?

  1. Pingback: Dollar Savings Direct Ups Online Savings Account to 4.00% APY | Online Savings Blog

  2. What is going on with dollar savings?
    Their # is disconnected and I cannot access my online application despite several tries.
    Are they a hoax?

  3. IMK ~ just logged into my account 12 Nov ’08. Still works and earning interest. Don’t think they are a hoax.

  4. I just called and spoke to the customer service department and they have been around since April ’08 and have only changed their interest rate once, so I’m hoping they aren’t going to drop their rates anytime soon. I will open an accountant even though I don’t know a whole lot about them and am not sure if I can trust them or not, but we will see. I will keep an update on here, and if anyone else knows anything about them give me an email before I dump a bunch of money with them. Mobymob@gmail.com

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