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PSA: Discover 12-month now 1.50%

Established Contributor

PSA: Discover 12-month now 1.50%

See the subject. Better CSR's than Sync or Ally from what I've heard. I just opened one this morning.


TU FICO 8: 750 (11/17) — Ex FICO 8: 732 (12/17)
Message 1 of 15
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Valued Contributor

Re: PSA: Discover 12-month now 1.50%

Wow not bad!  I have some rolling CDs that roll over every 2 months (6 of them, of course) and I just rolled one back into a 1.4% CD but 1.5% is even tastier.  My next one rolls over in December, ugh.  But since Discover is sending me my $2500 security deposit back in 5-7 business days, I think that'll go into a 1.5% CD right away and I'll just withdraw and close the December one for now. 

 

1.5% is mighty.  That's $37-$38 a year in free money and if you do a bunch of well timed 12-month CDs, you always have a big chunk of change coming in a month or two if needed.  Highly recommended to keep SOME of your emergency stash in 6 CDs that roll over every 2 months or so.

 

Great find!

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Message 2 of 15
Established Contributor

Re: PSA: Discover 12-month now 1.50%


ABCD2199 wrote:

Wow not bad!  I have some rolling CDs that roll over every 2 months (6 of them, of course) and I just rolled one back into a 1.4% CD but 1.5% is even tastier.  My next one rolls over in December, ugh.  But since Discover is sending me my $2500 security deposit back in 5-7 business days, I think that'll go into a 1.5% CD right away and I'll just withdraw and close the December one for now. 

 

1.5% is mighty.  That's $37-$38 a year in free money and if you do a bunch of well timed 12-month CDs, you always have a big chunk of change coming in a month or two if needed.  Highly recommended to keep SOME of your emergency stash in 6 CDs that roll over every 2 months or so.

 

Great find!


Congrats on the graduation! I only moved money from Disco savings to the CD for the 0.3% difference. Not even $10 difference, but still better than leaving money on the table, especially if rates pull back a bit.

 

Back in March when Cap1 360 had the 1.30% for 12 months I was happy with that. They've dropped to 0.90% though Smiley Sad


TU FICO 8: 750 (11/17) — Ex FICO 8: 732 (12/17)
Message 3 of 15
Valued Contributor

Re: PSA: Discover 12-month now 1.50%

$10 is $10 today, but $10 in gains at 1.5% annually after 40 years is $18.21 lol.  Free money is free money.

 

I wouldn't look at it as an investment, but it's a safer place to sock away some of your emergency fund, and every free dollar is a good free dollar to me.

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Message 4 of 15
Community Leader
Valued Contributor

Re: PSA: Discover 12-month now 1.50%

I just got this email from Penfed, they're offering 1.61% for 12 month -

 

penfedrate.jpg

1. PenFed Annual Percentage Yield (APY) is current as of October 18, 2017, and is subject to change. Minimum opening deposit is $1,000. A penalty will be imposed for early withdrawal. This will reduce earnings on the account. For all certificates funded by ACH, funds cannot be withdrawn within the first 60 days of the account opening.


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Message 5 of 15
Community Leader
Super Contributor

Re: PSA: Discover 12-month now 1.50%

Thanks for sharing!


Daily Drivers: Penfed Platinum Rewards; NFCU GoRewards; Discover; NASA Platinum Cash Rewards. EQ: 763 TU: 737 EX: 787
Message 6 of 15
Established Contributor

Re: PSA: Discover 12-month now 1.50%

This sounds interesting.  Can someone go into a little more detail on how this works and how to get started?  I'm clueless.

AMEX Delta Gold 1K l Cap One QS 3.8K l NFCU Plat 3.7K l Express $500

FICO 8 Scores: EQ~691 l TU~648 l EX~635
Message 7 of 15
Valued Contributor

Re: PSA: Discover 12-month now 1.50%


A1Credit wrote:

This sounds interesting.  Can someone go into a little more detail on how this works and how to get started?  I'm clueless.


Clueless on what in particular?  Get started doing what?

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Message 8 of 15
Established Contributor

Re: PSA: Discover 12-month now 1.50%


ABCD2199 wrote:

A1Credit wrote:

This sounds interesting.  Can someone go into a little more detail on how this works and how to get started?  I'm clueless.


Clueless on what in particular?  Get started doing what?


Do you guys just put a minimum 1K or more into a CD and then cash out after a certain time then do it all over again?

AMEX Delta Gold 1K l Cap One QS 3.8K l NFCU Plat 3.7K l Express $500

FICO 8 Scores: EQ~691 l TU~648 l EX~635
Message 9 of 15
Valued Contributor

Re: PSA: Discover 12-month now 1.50%


A1Credit wrote:

Do you guys just put a minimum 1K or more into a CD and then cash out after a certain time then do it all over again?


Yeah, doing the rolling CD method requires quite a bit of cash but it's very useful for getting more interest back.

 

Basically, if your bank offers a $1000 CD minimum for 12 months at a decent interest rate, you would need $4000 total to do rolling 3-month, $6000 to do rolling 2-month (and $3000 to do rolling 4-month).

 

So basically, using the rolling 2-month as an example:

 

  1. $1000 CD on 10/19/17 -- matures in 10/18 for you to use or roll over again.
  2. $1000 CD on 12/19/17 -- matures in 12/18
  3. $1000 CD on 2/19/18 -- matures in 2/19
  4. $1000 CD on 4/19/18 -- matures in 4/19
  5. $1000 CD on 6/19/18 -- matures in 6/19
  6. $1000 CD on 8/19/18 -- matures in 8/19
  7. Once you get to 10/18, you can roll over CD #1, or you can use it if an emergency happened.

Some banks offer odd term length CDs to help start the rollover today.  For example, if your bank offers an odd term length, you can actually get a 12-month, 14-month, 16-month, 18-month, 20-month and 22-month set of CDs each with $1000, and then roll them over into 12 month terms upon maturation.

 

If a CD offers 1.5% for 12months and you invest $1000, your maturation amount is $1015 (compounded annually) or $1015.11 (compounded daily).  So you would roll that amount over and add any new savings to it if desired.

 

I like 2 month roll overs because it is easier to manage, and because I have more than enough lower interest savings cash to cover me for 60 days to the next roll over.

 

My actual CD amounts total what I spend in 60 days (or close to that).

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Message 10 of 15