I know it’s late notice but CIT bank, one of the top interest rate banks consistently in the newsletter, is offering a bonus on a platinum savings account if it is opened by 1-28-26 and funded within 30 days with the appropriate amount of money. The bonuses available are 225 for a 25000 deposit of new money or 300 for a 50k deposit. The apy is 3.75% at those levels. It is one of the highest rates I found for liquid cash savings accounts. This is NOT citibank! The account must be opened by month’s end but can be funded within 30 days to qualify for the bonus, which is paid within 60 days of that. The platinum savings account must be opened with the promo code PS2025. Details are online. I’ve compared the interest rate with a bonus of 225 (for the 25k balance) to a slightly higher interest rate of 3.9% and found it to come out ahead through at least the 2 year mark given my tax rate. That said, my research shows the additional 25k, if you have it, is better invested elsewhere.
I’ve been keeping some cash at CIT for a couple of years now. Their interest rate is good, but not the best out there, and I’ve had to actually change my account once because they introduced a new savings account with a higher interest rate. That’s a tactic some of the banks use to attract new customers while keeping the old customers at a lower interest rate. Overall, I’ve been pleased and I’m considering using it as my hub account for most of my banking transactions. They were purchased by First Citizens Bank (a solid bank that I’m familiar with in NC), but CIT offers MUCH higher interest rates than First Citizens. I think it’s a good option for cash savings, but not as good as using a Treasury money market fund (such as Vanguard VUSXX) because the interest in treasury funds is exempt from state taxes.
The bonus significantly enhances the yield on the initial $25,000 and yields a better yield than many other accounts with slightly higher rates without bonuses during the first year alone. The important thing is to verify that the money deposited into this account is considered ‘new money’ and to maintain the minimum balance(s) so that you do not lose the bonus.
I also agree that the additional $25,000 is likely better off being used to earn interest on something longer-term unless you intend to keep it fully liquid. The convenience and flexibility of being able to access your money easily provide a benefit, but not one that provides enough of a benefit to warrant being thought of as anything other than a convenience and a nice option when needed.
Thanks for sharing this solid find, especially with the bonus factored in CIT has been competitive for a while and this looks like a nice short-term parking spot for cash.
Absolutely! And I misstated the apy. It is actually 3.75. I didn’t see a minimum balance after the determination period of 30 days in the terms. This is meant to be emergency money. AI suggested T bills or ultra short bonds for the rest but I’m suspect of AI. What other instruments would you suggest? I already have a full slate of index funds, etf and regular, and retirement accounts.
I apologize bc I misstated the interest rate for the platinum savings special. It is actually 3.75 plus the bonus. Vusxx took some research. Vanguard app lists this fund at 3.65 with a 0.07 expense ratio and fully taxable so it wouldn’t be competitive. Did you mean to name a different fund that is state tax exempt, namely for CA?
No, VUSXX is the correct fund. It is 100% fed govt obligations, so it is federally taxable but fully CA state tax exempt. It has a .07% expense ratio (which is about as low as you’ll find on any fund…$17.50 on $25000). I prefer it over bank funds, because almost nothing is more secure and liquid than a short term treasury, and short term treasuries are insulated from radical market shifts in a financial crisis. I save hundreds in CA taxes by holding them instead of receiving bank interest.
So, in your case, depending on your tax bracket, with bank interest you could earn an extra $25 ( .1% extra interest rate) plus $17.50 (expense ratio fee), but pay an extra $75 in CA state income taxes.
Actually I did attempt to open CIT account several years ago for the attractive interest. However they did not like my address and refused to adjust it so they got zero. No problem my investment firm has consistently done way better then the paltry 3 or 4% so I don’t need interest bearing…