CD Rates, Gifts Under That Bow
Posted on November 20th, 2011
If you’re bummed like we are that iGObanking cut its CD rates as quickly as it did, there’s still an opportunity to earn more if you’re intent on investing here.
iGObanking, the online division of Flushing Savings Bank, has a sister site that offers CD rates with a gift during the holidays.
With your certificate of deposit at GiftsforBanking.com, you can earn everything from a set of cookware to a Hawaiian vacation package. Still, it’s those tech toys like an iPad 2 that this gimmick promotes the most.
After its rate cuts Friday, the CD rates at iGObanking.com and GiftsforBanking.com are identical.
With a minimum deposit of $5,000, it pays:
- 0.90% APY on a 2-year CD.
- 1.25% APY on a 3-year CD.
- 1.75% APY on a 5-year CD.
You’ll give up a good deal of interest over what’s on our CD Rates Leaderboard to earn these gifts, but in some cases you can make up the difference with the value of your gift.
There are numerous gift choices for each deposit level.
Put $5,000 in a 5-year CD, for example, and an Amazon Kindle, iPod Nano or a 10-piece Calphalon cooking set are among the gifts you’ll be offered.
Put $25,000 in that same CD, and you can get a package that features a 64GB iPad 2 and a Canon PowerShot Camera with photo printer.
Is it worth it?
Apple sells the iPad model for $699, and the camera and photo printer sell for $260 on Amazon.com. Total: $959, not including shipping or sales tax.
With this 60-month CD, you’ll earn about $2,265 in interest. With the best nationally available bank CD, you’ll earn about $2,942.
That’s a difference of $677.
Our CD calculator can help you determine how far the value of the gift you have your eye on helps close the gap between these CD rates and the best nationally available deals.
Just remember that you’ll have to pay income tax on the value of the gift, as it is considered interest on your account. And we’ve heard complaints that GiftsforBanking.com sets a high retail value on the gifts when it reports them to the IRS.
The gift offer is scheduled to end Nov. 28. But as we saw Friday, there’s no guarantee the CD rates will last that long.
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Tags: Cd Rates, Rates
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