Update: This review of bank rate auction site MoneyAisle was written in 2008. The rates mentioned in this article are no longer accurate, and it appears MoneyAisle has shut down as of Feb. 2011. You can search for the latest top online banking rates here.
If you’re just starting to stash away a few hundred dollars for a rainy day, you probably don’t give your savings account’s interest rate much thought. But if you need to save $1,000 or more in an FDIC insured account, you might feel like you deserve better than 0.5 percent interest on your cash. Good news: The banking auction site MoneyAisle agrees.
MoneyAisle is like eBay for savers. In a simple form, you tell MoneyAisle the amount of your initial savings deposit, whether you want a high yield savings account or certificate of deposit (CD), and your home state. Hit submit, and several dozen savings banks compete for your deposit. MoneyAisle returns the bank offering the highest available rate for your deposit level.
If you like and accept the offer, you will be forwarded to the bank’s website to complete the deposit. If you’re unhappy with the result, you’re under no obligation to deposit. You can try another auction, or come back another day.
How Did Money Aisle Do?
We ran three different searches for high yield savings accounts (in Massachusetts) for $600, $5,000, and $15,000. The $600 search returned a 2.9% APY at Legacy Bank, with branches in Massachusetts and New York. Our $5,000 search did slightly better, catching a 3.4% APY at a New York credit union. Finally, our $15,000 search also netted a 3.4% APY, this time at Beverly National Bank. (Note: This was in July 2008; sadly rates are lower across the board now).
In sum, the rates MoneyAisle returned for the $5,000 and $15,000 were slightly better than any I’ve seen advertised. At the time of the search, however, most high yield savings accounts we review here at Money Under 30 had rates close to the 2.9% rate for a $600 deposit.
Bottom line? If you’ve got $1,000 or more to save and want to find the best possible rate for your cash, I think MoneyAisle can help. If you’re just starting out saving, you can probably stick with any of these popular online savings accounts.