ING Electric Orange interest rate drops

December 17th, 2008 · No Comments

ING Direct updated their website recently to reflect a drop in all tiers of interest rates that they’re paying on the Electric Orange checking account.  The lowest tier dropped from a 1.00% APY to a 0.50% APY.  I suspect there will be alot more of this all-around due to the recent Fed rate drops.

Here’s the full set of tiers as of the 12/17/2008 effective date:

  • For balances between $0 and $49,999.99, the rate is 0.50% APY.
  • For balances between $50,000 and $99,999.99, the rate is 2.85% APY.
  • For balances over $100,000.00, the rate is 3.05% APY.

ING Direct

In looking around at a few other online banks, I have yet to see any other similar rate drops but then it is not always as easy to find information about checking rates as savings rates. (Plus I don’t check their websites as often nor memorize their rates since I don’t have accounts there.)  Anyway, I suspect it’s only a matter of time before more institutions have to make similar rate cuts.

At some point, they’ll also all likely cut savings rates too, but that may be on a significantly different timeline due to the difference in cash flow patterns between these different account types.  I can confirm that the interest rate on the Orange Savings Account at ING Direct remains unchanged at 2.75% APY as of today, and likewise FNBO Direct is still reporting 3.25% APY.  I don’t pay enough attention to know whether the rates have changed on the various CD options.

Anyway, I’m positive this rate drop will have no effect on whether we continue to use the Electric Orange account or not.  The rate almost doesn’t matter to us because we can keep less than $1.00 in the account as a result of ING Direct’s policy of instantaneous money transfers between checking and savings accounts.    On the other hand, there are a number of things I don’t like about ING’s policies associated with the Electric Orange account, so they’re not out of jeopardy yet.

That being said, I’ll give it a week or two to see how things settle out across a number of financial insitutions before making any changes in our financial behavior and account lineup.

Tags: Checking

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