FYI - ING Electric Orange Customers - Interest Drop

[fake_usa]

I just noticed they quietly dropped the interest rates on us.
I did not recievce an email of this, I just noticed it by clicking on the "Today's Rates" link in my account details page.




FYI
I paintshopped a prinscreen because the copy and pasting of the texted did not format correctly on the forum.

[34saving]

Just got my debit card today. Glad my initial deposit was only $10.

[autoxer]

They also lowered the interest rate on their savings accounts from 4.5% APY to 4.3% APY. I knew they weren't as high as their competition, but I didn't do anything about until now... I just withdrew all of my money, so I can transfer it to a money market account.

[humandraydel]

All rates have fallen (or will soon). GMAC went from 5.3% APY to 4.9% APY. The difference between GMAC and ING was 0.8% APY and now it's 0.6% APY. With the 0.2% APY drop at ING, you just lost $20 (before taxes) on every $10,000 you have in there. Hardly worth worrying about, IMHO. I know some chase rates but I do not as I don't keep much in cash anyway.

[autoxer]

With the 0.2% APY drop at ING, you just lost $20 (before taxes) on every $10,000 you have in there. Hardly worth worrying about, IMHO.

Would you feel differently about losing a twenty dollar bill? If you thought you dropped it somewhere would you go back and check or would you just shrug it off because it is hardly worth worrying about?

I'm not exactly a rate chaser, because I've had the same account for the past two years, but I wouldn't say it is hardly worth worrying about. I have a lot in cash, because I'm saving up for a house downpayment, so changing my rate from 4.3 to 5.+ will earn me more than $100. Opening a new account was a pretty easy way to increase my return.

[sweeps]

I agree, autoxer. Rate chasing gets a bad rep, but it can result in a great deal of interest of time. Some forum members will do whatever it takes to get a few bucks here, a free item there, but they won't maximize their savings interest.

[humandraydel]

I understand your desire to maximize your rate and I don't blame you. I'll admit, I'm actually considering switching to a Countrywide money market account for a 1.2% increase over ING (Countrywide is at 5.5%). I do think it's important to keep it in perspective though. I've seen people move $3000 all over chasing rates and I'm not sure they realize how little they are making. If you have a large amount, by all means, maximizing interest rate can be worth it.

[Scanner]

Maybe someone could enlighten us - at what threshold do you feel it's worthwhile to chase a higher rate and for what amount of average balance?

The average balance we have sitting in checking is around $10-12,000.

I probably wouldn't rate chase for 1%, but 1.5-2%, I would.

[humandraydel]

I think you should calculate the potential return and decide if it's worth it for you. Personally, I don't like the hassle of changing my direct deposit, my account links, etc. I certainly wouldn't change for less than 1%. At 1% it starts to be worth it.

[sweeps]

Maybe someone could enlighten us - at what threshold do you feel it's worthwhile to chase a higher rate and for what amount of average balance?

The average balance we have sitting in checking is around $10-12,000.

I probably wouldn't rate chase for 1%, but 1.5-2%, I would.

Just to clarify, I don't think it's smart chasing this week's or this month's high rate. But some companies have proven that over time they offer the most competitive rates. Companies like UFB, FNBO, HSBC, Emigrant, and my personal favorite, GMAC. Because of the lag time between getting your money from one account to another, it actually can take several weeks to recoup the lost interest (regardless how much money you have in play) so hyper rate chasing is not smart.

For me, if I'm giving up $5 or so a month, I'm probably switching. If I were in ING for the last couple years, I'd be really kicking myself.

I think you should calculate the potential return and decide if it's worth it for you. Personally, I don't like the hassle of changing my direct deposit, my account links, etc. I certainly wouldn't change for less than 1%. At 1% it starts to be worth it.

Checking accounts are a bit different. Savings accounts, for all intents and purposes, are a commodity. But with checking, you have a lot more to deal with... direct deposits, checks, deposits, bill pay, etc. etc. This is why companies are getting more involved in the checking account game. It forces more loyalty from customers. Interest rate is still a factor, but not the only factor as in savings accounts.

[eisor]

We are keeping our ING Electric Orange checking. The only other online checking we would be able to maintain the minimum balance, or fulfill the other requirements would be the UnivestDirect. But, their website is very unappealing. And, I won't use their service because of this. It's very unprofessional looking. It may be a silly reason, but I just can't be a customer of a company with such a poor looking website.

[Skooby]

All rates have fallen (or will soon). GMAC went from 5.3% APY to 4.9% APY. The difference between GMAC and ING was 0.8% APY and now it's 0.6% APY. With the 0.2% APY drop at ING, you just lost $20 (before taxes) on every $10,000 you have in there. Hardly worth worrying about, IMHO. I know some chase rates but I do not as I don't keep much in cash anyway.

For how long do you think these rates will continue to drop?

I'm debating with myself on which MMA I should open for an emergency fund. I'm already with FNBO, but their transfer times are slow and they don't have a debit card.

I think GMAC has a debit card but they just dropped their rates. Do you guys expect them to drop their rates any further?

[humandraydel]

Do you guys expect them to drop their rates any further?

Really it depends if the Fed cuts rates again. Personally, I dont think the Fed will cut rates again, but some out there do.

Countrywide needs money badly and are offering very competetive rates. 5.5% for a savings account and 5.65% for a 12 month CD ($10k minimum on both). It might not be a bad time to lock in a 5.65% CD for 12 months. I'm certainly considering it.

[project15]

ED is down to 4.75% as of today.

[Aleta]

I felt like that ING was the first one to take advantage of the fed's cut. I moved most of my money to Emigrant Direct and today, closed the ING Accont and moved the remainder to Emigrant. I'm just not going to reward them for being one of the first to lower their rates when their own rates were lower than most. It's just not worth the aggravation of more paper work. I have been pleased with Emigrant Direct and their rate OK. I find their interface to be the same as ING's.

Whoever is the first one to lower their rates will be the first one that I will eliminate. I don't know about you, but that's how I personally feel about it.