Homebuyer affordability decreased slightly in May, as new mortgages took up a larger share of a the average person’s income while rates trended higher. High inflation and rising mortgage rates won’t lessen the burden on new home buyers in the coming months.
The national median payment applied for by applicants rose to $1,897 last month from April’s $1,889, according to the Mortgage Bankers Association (MBA). The national median mortgage payment for conventional loans was $1,960, down slightly from April’s $1,967, but significantly higher than a year ago, when it was $1,394 in May 2021. Federal Housing Administration (FHA) loan payments rose to $1,430 in May from the previous month’s $1,374.
“The ongoing affordability hit of higher home prices and fast-rising mortgage rates led to a slowdown in purchase applications in May,” said Edward Seiler, MBA’s associate vice president for housing economics and executive director at the Research Institute for Housing America, according to a statement.
“While the median principal and interest payment only increased $8 from April, a typical borrower is paying $514 more through the first five months of 2022 – a jump of 37.1%,” he said.
The average purchase mortgage rate rose to 5.27% in early May, according to Freddie Mac PMMS, a 13-year high until it surpassed the 6% level in June.
Citing inflationary pressures and mortgage rates above 5%, Seiler said the MBA expects sales of new and existing homes to fall below 2021 levels. The agency expects some 5.76 million existing homes to sell in 2022, well below the previous year’s sale of 6.13 million existing homes. New home sales are forecast to remain slightly more stable, with the sale of 769,000 new houses projected, down from 771,000 new houses sold last year.
The purchase applications payment index (PAPI), which measures how new monthly mortgage payments vary relative to income, rose 0.4% to 163.4 in May from 162.8 in April. An increase in MBA’s PAPI, indicative of worsening borrower affordability conditions, means the mortgage payment to income ratio is higher due to increasing application loan amounts, rising mortgage rates, or a decrease in earnings.
Black and white households’ homebuyer affordability dropped at the steepest rate at 0.7 points. The index for Black households rose to 166.6 and climbed to 164.3 for white households in May from April.
Borrowers in Idaho are facing the greatest affordability challenges with a PAPI index coming in at 253, followed by Nevada (249.7), Arizona (233.5) and Utah (210.9).
Meanwhile, borrower affordability conditions were best in Washington D.C. (99.7), with Alaska (102.6), Connecticut (111.2) and West Virginia (113) trailing behind.
Higher education could soon become more affordable for more than 700,000 of the incarcerated people in the U.S. Starting July 1, they’ll become eligible for Pell Grants for the first time in nearly 30 years, regardless of sentence length or conviction.
Pell Grants are a type of need-based financial aid from the federal government that gives recipients up to $7,395 per academic year to cover college costs like tuition, books and other fees. Unlike a loan, the grants never need to be repaid; students qualify based on financial need.
Incarcerated people — those in juvenile justice facilities and local, state and federal correctional facilities — will be able to use these Pell awards to pay for prison education programs (PEPs), which can lead to credentials like a professional certificate, an associate degree or a bachelor’s degree from a partner university.
Though the change is effective July 1, students may not be able to enroll in a PEP using Pell Grants immediately, says Ruth Delaney, associate initiative director at the Vera Institute of Justice focused on education reform in prisons. Some programs may start this fall, she says, but even then, enrollment won’t begin until later in the summer.
Here’s what you need to know about the Pell Grant expansion for prison education programs and how incarcerated students can access these funds.
Impact of Pell expansion for incarcerated students
Without access to Pell Grants, higher education has been virtually out of reach for most incarcerated people, who earn an average minimum wage of 86 cents per hour in typical prison jobs, according to a 2017 analysis by the Prison Policy Initiative, a nonprofit public policy think tank. There were nearly 800 PEPs in the early 1990s, but after a 1994 crime bill blocked incarcerated students from receiving Pell Grants, the number of PEPs shrank to eight by 1997, according to the Vera Institute, a nonprofit that supports criminal justice reform.
Obtaining a higher education degree or certificate can help incarcerated students find stable careers and better pay when they reenter the workplace. People who participate in correctional education are also 43% less likely to return to prison within three years than those who don’t participate, according to a 2018 report by the Rand Corp., a public policy research organization.
Some incarcerated students have been able to access Pell Grants for years as part of an experimental program called Second Chance Pell established by President Barack Obama in 2015. As of 2022, incarcerated students had earned more than 7,000 credentials through the program. For example, Georgetown University launched its Prison Scholars Program in 2018 to bring higher education to incarcerated students in Washington, D.C., and Maryland.
“Financial aid is one piece of this puzzle,” says Rachel Rotunda, director of government relations at the National Association of Student Financial Aid Administrators. “This is a big change for students, but it’s also a big change for institutions and really the whole higher ed prison education community.”
Submit FAFSA to qualify for a Pell Grant
To be considered for a Pell Grant, incarcerated students must fill out and submit the Free Application for Federal Student Aid (FAFSA).
Because correctional facilities may offer limited or no internet access, students may need to submit a paper copy of their FAFSA application to partner college representatives at their facility. Then the partner college will submit the FAFSA on the student’s behalf to the office of Federal Student Aid, which will evaluate the application and determine the student’s eligibility and grant amount.
“A lot gets facilitated through the college, which means that the prospective student likely already knows what college they’re going to be applying to,” Delaney says. “The other side to that is that it’s rare to see more than one college program at a single prison.”
Though incarcerated students can legally submit the FAFSA as early as July 1, they may need to wait until their facility’s education staff is ready to accept applications and a PEP course is slated to begin.
Incarcerated students shouldn’t worry about filing the FAFSA months ahead of time; they’ll likely need to submit the FAFSA around the time they’re slated to enroll in a PEP, Delaney says. Deadlines will vary by program.
“There tends to be a bit more of a condensed timeline for enrollment [in prisons] compared to the more community-based timeline,” Delaney adds.
Other grants and scholarships to pay for prison education programs
Incarcerated students are blocked from receiving federal student loans, which can provide undergraduates with up to $12,500 in funds each year that must eventually be paid back.
But if a Pell Grant award is not enough to cover the cost of a prison education program, students may turn to other funding sources. This may also be necessary if a student embarks on multiple degrees or takes extra time to finish a program because Pell Grants can be used for no more than six years.
And in many cases, the colleges running PEPs are putting their own resources into making them affordable, Rotunda says, “to ensure that they’re able to offer high-quality programming and to provide students the same level of support that they would be providing for any other student.”
Where to get answers to your questions
If you’re incarcerated and have questions about the FAFSA, Pell Grants or PEPs, you can reach out to the following resources:
A financial aid administrator or other education representative at your correctional facility:
Varies by correctional facility.
Send questions to the Education Department by mail. Address letters to:
U.S. Department of Education
c/o Prison Education Programs
400 Maryland Ave SW
Washington, DC 20202
If you have internet access, send questions to the Education Department by email:
Incarcerated students with defaulted student loans
If you’ve defaulted on student loans in the past, you can sign up for a temporary government program called Fresh Start. This program will return your loans to good standing, allowing you to submit the FAFSA and receive a Pell Grant while incarcerated.
If you now have a loan in default, you’ll need to send a letter to:
P.O. Box 5609
Greenville, TX 75403
In your letter, include your full name, Social Security number, date of birth and the following statement: “I am a confined or incarcerated individual. I would like to use Fresh Start to bring my loans back into good standing.”
When you choose a bank for your daily checking and savings needs, you can choose between a national bank, a smaller regional bank, credit unions of varying sizes, and even online banks and financial technology companies.
Since early 2023, when Signature Bank and Silicon Valley Bank both experienced failures after customers pulled out large amounts of money during bank runs, banking customers may feel more comfortable choosing a national bank.
Although the U.S. government took extraordinary measures to protect the assets of SVB and Signature Bank customers, and deposits held in the accounts were FDIC insured, many customers were still rightfully concerned about gaining access to their money in a timely manner.
After the banking crisis of 2008, the Federal government declared banks like JPMorgan Chase, Bank of America, Citibank, and Wells Fargo as “too big to fail.” But these aren’t the only national banks or credit unions available.
You might think that smaller online banks may have lower fees, while small local banks are known for friendly and responsive customer service. But the national banks on this list blend the best of all worlds: low fees, high marks for customer satisfaction, ways to avoid overdraft fees, convenient ATM networks, and a variety of banking products.
16 Best National Banks
Here are the 16 best national banks that offer exceptional services, excellent customer support, and innovative banking solutions to meet all of your financial needs.
1. SoFi – Best for Digital Banking & High Yields
SoFi became a nationally chartered online bank in 2022, after acquiring Golden Pacific Bancorp, Member FDIC. Originally known for its vast array of loan products, including private student loans, today SoFi has a combination checking and savings account, or a cash management account, with no monthly service fee.
SoFi also has no minimum balance requirements, no overdraft fee, and overdraft protection up to $50 with qualifying direct deposits each month. You can bank for free at any of 55,000+ fee free Allpoint ATMs nationwide.
As an online bank, SoFi offers higher interest rates than you may find at brick and mortar banks. Earn up to 4.20% APY on your savings account balance and 1.20% on money in your checking account. When you use your SoFi debit card at select local businesses, you can earn up to 15% cash back.
SoFi offers two tiers of accounts: SoFi and SoFi Plus. To qualify for the “freemium” SoFi Plus membership, bank customers must have qualifying direct deposits. Plus, when you sign up before December 31, 2023, you can earn a cash bonus of $250 when you set up direct deposits of $5,000 or $50 with a direct deposit as low as $1,000.
SoFi Plus members receive loan rate discounts, bonus rewards, access to special entertainment events and more, making SoFi a unique company when it comes to online banks.
2. Discover Bank – Best for Cash Back
Discover may be best known for cashback and rewards credit cards. But its online banking products are some of the best you’ll find among national banks.
With no monthly fees and no minimum balance, your Discover Cashback checking account pays 1% cashback on up to $3,000 worth of debit card purchases monthly. You’ll never pay overdraft charges, and you can withdraw cash at a network of 60,000+ fee free ATMs.
You can qualify for overdraft protection by linking your Discover Bank savings account. Discover Savings pays a high 3.90% APY with no minimum deposit required.
Other Discover Bank deposit accounts include CDs with terms from 3 months to 10 years, and a money market account that pays 3.80% APY for balances under $100,000 and 3.85% on balances $100,000 and up.
For questions or help with your account, you can reach a U.S.-based customer service representative for Discover Bank by phone, 24/7/365.
3. Chase Bank – Best for Credit Card Rewards & Referral Bonuses
As the world’s largest national bank, JPMorgan Chase Bank doesn’t need to do much to entice customers. People will choose Chase based on its name, reputation, and more than 4,700 convenient branch locations across the U.S.
However, Chase happens to have one of the best bonuses for new customers and a generous referral bonus program when existing customers refer their friends. This, coupled with a robust and easy-to-use mobile app and a variety of checking, savings and investment services, puts Chase on our list of top national banks in the U.S.
Chase is currently offering new Chase Total Checking customers a $200 bonus when they open a new account and set up direct deposit within the first 90 days.
New or upgrading Chase Private Client customers can earn a $3,000 bonus with a deposit of $500,000 or more within the first 45 days of account opening. Deposits of $150,000 to $249,999 earn $1,000 and cash deposits of $250,000 to $499,999 earn $2,000. You must keep the money in your J.P. Morgan Wealth Management or JPMorgan Chase deposit accounts for 90 days to qualify.
In addition to Chase Total Checking, the bank’s most popular checking account, and Private Client services, Chase also offers other checking and savings accounts.
Chase Secure Banking has a $4.95 monthly fee and no overdraft fees. Chase Premier Plus Checking offers a few added benefits beyond Chase Total Checking, including ATM fee rebates up to four times per statement cycle, a linked personal checking account with no monthly fees, and a 0.01% interest rate on balances.
Chase also offers bank accounts for kids, teens, and college students, as well as CDs, savings and money market accounts, mortgages, loan products, and a full array of top-rated rewards credit cards.
If you have multiple Chase accounts, it’s easy to manage them all within the mobile app.
4. Chime – Best for Building Credit
Chime is a financial technology company backed by Stride Bank, Member FDIC, and Bancorp Bank, Member FDIC. It is not a bank, itself, but offers some of the same features, including online banking, a debit card, and direct deposit up to two days earlier than some other banks.
Chime has no monthly service fee, no overdraft fee, and no minimum balance requirements. For customers who need a little boost to make it from paycheck to paycheck, Chime offers fee-free overdraft up to $200 through the SpotMe5 program and a credit builder secured Visa credit card with no annual fees, interest or minimum security deposit.
Use your Chime debit card at any of 60,000+ fee free1 ATMs in the Allpoint, MoneyPass or Visa Plus Alliance ATM networks. Out of network ATM fees may apply, otherwise.
You can qualify for Chime’s SpotMe program with a single direct deposit of $200 or more during any monthly statement period. If you process a transaction that would put you into overdraft, Chime will accept the transaction even if it puts your balance into the negative by up to $200.
The Credit Builder Secured Visa card carries the same requirements of a $200 monthly minimum direct deposit. You can build your credit and raise your credit score with responsible use of the card.
5. Citi® – Best for Large Cash Deposits
The third of the four largest national banks in the U.S. based on assets, Citi, owned by Citigroup, is best for high net worth customers or those with large cash deposits divided among Citi checking, savings, and other accounts.
Currently, you can earn a generous cash bonus of $200 to $2,000 when you open a qualifying Citi checking account and meet specific minimum opening deposit requirements. Your bonus will be determined by your account balance on the 20th day after opening the account. Funds must remain in the account for an additional 60 days after the 21st day.
Citi offers multiple checking accounts to meet various customers’ financial needs, all with monthly fees that are easy to waive if you hold the required minimum balance. The bank accounts include:
Citibank
Citi Priority, which includes travel perks and access Citi Personal Wealth Management advisors
Citigold, relationship banking and investment services
Basic Banking and ATM access
Access Account, a debit account with no paper checks
For the Basic Checking account, you’ll need to maintain a $1,500 minimum balance to waive the fees. The other accounts have larger minimum balance requirements to avoid monthly maintenance fees and take advantage of other perks, up to $200,000 for a Citigold account.
All accounts provide access to personal banking at Citi branches and access to more than 65,000 fee free ATMs across the U.S. All accounts except for Basic and Access accounts also have no fees at ATMs outside the Citi network.
Like all the larger national banks on this list, Citi has a full gamut of rewards credit cards, savings and money market accounts, and high-yield CDs.
6. CIT Bank – Best for High Interest Rates
CIT Bank, a division of First Citizens Bank, has earned awards and accolades for customer satisfaction, rated by American Banker as #1 for “delivering the most humanized experience in banking.”
You should be aware that deposits in First Citizens Bank & Trust Company, Member FDIC, are not separately insured. This only matters if you hold more than $250,000 in any single account type, such as checking or savings, in both First Citizens Bank and in CIT Bank.
CIT is the online only banking arm of First Citizens Bank, with high-yield savings accounts, CDs, money markets, and eChecking, all with no monthly fees and no overdraft fees. You won’t pay any ATM fees at CIT Bank machines, and CIT Bank reimburses up to $30 per month when you use out-of-network ATMs.
CIT offers 0.25% APY on checking when you hold more than $25,000 in your account, and 0.10% APY on balances under $25,000. The bank has high interest rates for savings, offering customers a 4.85% APY on balances of $5,000 or more with the Platinum Savings account.
CIT Bank has two other savings accounts as well:
Savings Connect, with a 4.60% APY
Savings Builder, which requires a minimum balance of $25,000 or a $100 monthly deposit to earn 1.00% APY
You’ll need a $100 minimum deposit to open a checking or savings account at CIT Bank.
7. Bank of America – Best for College Students
As the second largest of the best national banks, behind Chase, Bank of America has the full gamut of banking products, with three checking accounts plus a student account, savings, CDs, and investment products.
It’s easy to waive monthly maintenance fees on a checking account with a minimum daily balance, direct deposits, combined balances across eligible linked Bank of America accounts, or by enrolling in their Preferred Rewards programs.
We like the Advantage SafeBalance banking for kids, teens, and college students under 25 years old. They have no monthly fee and no overdraft fees. Teens ages 16+ can have sole ownership of the account.
For everyone else, the bank offers Advantage Plus and Advantage Relationship checking accounts with easy ways to waive the monthly fees with direct deposit or a minimum daily balance.
When you open a new checking account, you can qualify for a $100 bonus when you receive qualifying direct deposits of at least $1,000 within 90 days of opening the account.
Of course, Bank of America also has CDs, and a savings and money market account. Plus you can invest with Merrill. All of these deposit accounts count toward your Preferred Rewards membership.
When you have a combined average daily balance of at least $20,000 for three months, you’ll qualify for the rewards program.
8. U.S. Bank – Best for Military Members & High Balance Savings
U.S. Bank offers the Bank Smartly checking account so you can earn interest on your money. The current interest rate is just 0.01% APY on all checking balances. You’ll pay a $6.95 maintenance fee, but this is waived if you meet minimum deposit requirements or if you are a member of the U.S. military.
You can link your Bank Smartly checking account to a standard savings account or Elite Money Market to earn even more. To avoid fees on your savings account, you’ll want to keep a $300 minimum daily balance or a $1,000 average monthly collected balance. If you are already a Bank Smartly customer, you can enroll in Smart Rewards to waive savings account fees.
The Elite account is better for those with high balances. You can earn up to 4% APY on balances from $25,000 up to just under $500,000.
The appeal of U.S. Bank is in its high ratings for banking satisfaction across the board from customers. U.S. Bank earned accolades for having the best mobile app, the best digital mortgage tools, the best customer service features, and best mobile check deposit capabilities. These factors all contribute to its ranking as a best national bank.
9. Axos Bank – Best Online Bank
Axos is an online only bank with a rewards checking account that delivers up to 3.30% APY, with no fees and unlimited ATM fee rebates for out-of-network ATMs.
To earn the maximum APY, you’ll need to set up direct deposit and Axos Bank’s free Personal Finance Manager for 0.70% interest. Then, open an investment account and take out an Axos personal loan or auto loan and earn another 2.60% annual percentage yield on your checking account balance.
Axos also offers an Essential Checking account with early direct deposit and no fees, and a Cashback Checking account, which gives you 1% cash back on debit card purchases, along with no maintenance fees and unlimited domestic ATM fee reimbursements.
Voted the best online bank by many top personal finance sites, Axos Bank offers more than just high interest, no fee checking.
Axos Bank offers CDs with terms between 3 and 60 months and a savings account with 0.61% annual percentage yield, with interest compounded daily. You can also find personal loans, car loans, mortgages, and investment products.
Like other national banks, Axos Bank provides FDIC insurance up to $250,000 or $500,000 for joint account holders. But you can expand your coverage up to $150 million with Axos Bank InsureGuard+ Savings from IntraFi Network Deposits.
Axos splits up your large deposit into multiple accounts across several banks, each covered up to $250,000. If you are dealing with a substantial amount of cash and want your savings protected at a single bank, Axos may be a good choice for you.
New customers can earn a $100 welcome bonus by opening an account with just a $50 minimum opening deposit.
10. Truist Bank – Best for Relationship Banking & Innovative Savings Perks
Truist Bank is one of the top 10 largest national banks, formed as a merger between BB&T and SunTrust in 2019. Called “the biggest bank you’ve never heard of” by CNN Business, Truist holds assets of $574 billion and has been growing steadily since the merger.
Truist offers checking and savings accounts, CDs, and credit cards. Truist checking and savings customers can earn perks and benefits. This includes access to Long Game, a savings game app that lets you earn cash when depositing into your Truist savings account. It also includes bonus rewards on your Truist credit cards.
Truist has four levels of relationship banking in its Truist One checking account. This means the more you deposit, the more perks you will receive, up to a 50% loyalty bonus on Truist credit cards, and a discounted annual fee for a Delta SkyMiles debit card. Benefits for relationship banking begin at $10,000 in combined average monthly balances for Truist deposit accounts.
Your Truist checking account has a $12 monthly fee, which is easy to waive with $500 or more in direct deposits each month or a $500 minimum balance across all Truist deposit accounts. Truist personal loan, mortgage or credit card customers also pay no fees on their Truist checking account.
You can also waive the monthly fee with a linked Small Business checking account or if you are a student under the age of 25. You’ll need a $25 minimum opening deposit for a Truist One checking.
Customers with lower income or just getting started establishing their finances can benefit from Truist Confidence checking and savings accounts. The account has just a $5 monthly maintenance fee, which is easily waived.
11. Capital One – Best for High Interest Rates at a Brick and Mortar Bank
Like Chase Bank, Capital One is well known for its top-rated rewards credit cards. The company is also one of the best national banks with a savings account and CDs offering interest rates higher than the national average.
Capital One Performance 360 savings has a 3.90% APY, no monthly maintenance fees, and no minimum deposit to open your account. A Capital One 360 Performance checking account, similarly, has no monthly maintenance fee, overdraft protection through your linked savings account, and early direct deposit.
You can bank with no fees at a network of 70,000+ ATMs nationwide, and can deposit cash easily at CVS retail locations. Although you must open your Capital One Performance account online, you can receive personalized service and deposit cash at any Capital One bank branches or Capital One Cafes.
12. PNC Bank – Best in East and Southwest
PNC Bank is a large, national bank with branch locations across 29 states. Most branches are in the east, south, and southwest, although you will also find branch locations in some Midwest states.
PNC Bank’s online checking account is called Spend and it links to the PNC VirtualWallet. You can add a savings account, called Reserve, or upgrade to the Performance Select product with two tiers of savings and double layer overdraft protection.
When you set up your VirtualWallet with PNC Bank and open your Spend account, you can earn a $50 bonus.
Combining your Spend account with a PNC Bank Reserve account yields even more benefits. Earn a $200 bonus when you qualify. Finally, if you open a Performance Select VirtualWallet, you could earn $400.
Each account comes with a low monthly fee that is easily waived through qualifying monthly direct deposits or by meeting minimum balance requirements.
13. Wells Fargo – Best for Checking Account Options
Wells Fargo, one of the “big four,” is the fourth largest of the best national banks in the U.S. It is known for having many convenient bank locations, with 4,700 branch locations.
The vast number of branches across the country puts it top on our list for in-person banking and customer satisfaction.
Plus, we also rated it best for various checking account choices for everyone from children to retail investors.
Like the other national banks on this list, Wells Fargo has checking, savings, and CD accounts. The bank has four checking account options for consumers at various stages of their financial lives:
Clear Access Banking, with no overdraft fee and a low $5 monthly fee, waived for teens and young adults ages 13 to 24
Everyday Checking, the most popular bank account, with optional overdraft protection
Prime Checking, offering discounted interest rates for loans and higher interest rates for linked CDs and savings accounts
Premier Checking, a relationship banking service with 24/7 support and discounts on investing services
It’s easy to waive the $10 fee on Everyday Checking with a $500 minimum daily balance or $500 in monthly direct deposits. Waive the $25 fee on your Prime checking with $20,000 in linked balances. Similarly, your Premier Checking account will be free with $250,000 in linked balances, including investments with the bank’s Advisors.
You’ll need a $25 minimum opening deposit to open your account.
14. Ally Bank – Best Online Only Bank for Savings
Ally Bank is widely recognized as one of the best national online banks. It has very few fees, including no maintenance fee, no overdraft fee, and no ACH fee (even on expedited transfers). Plus, you’ll earn interest of 0.25% in your checking account and 3.85% APY on savings, including money you have allocated into various buckets.
We rated Ally Bank as the best online only bank for savings, not just because of the high interest rate, but because it offers so many ways to manage your money and ramp up your savings efforts.
You can set up recurring transfers into your savings account for specific goals or just to build up your emergency coffers. You can choose to round up transactions made with your Ally Bank debit card, or even electronic payments and checks. When Ally Bank finds at least $5 in “round-up” savings, it will be transferred automatically to your checking account.
Finally, Ally Bank analyzes your checking account periodically to reveal extra funds that are “safe to save.” Ally Bank automatically transfers that money for you. But you can transfer it back whenever you’d like.
In addition to these savings benefits, Ally Bank lets you access your money with your debit card with no fees at any of 43,000+ Allpoint ATMs. The online bank also refunds up to $10 in fees charged by out-of-network ATMs.
You can avoid stress and overspending with the Overdraft Transfer Service, which automatically transfers money from your Ally Bank savings account into checking. If you exceed six transfers or six savings withdrawals per month, Ally Bank will reimburse those fees, too.
You can also apply for CoverDraft℠ Coverage, which will cover up to $250 in charges that would put your account in the negative. You’ll qualify 30 days after you deposit at least $100 into your checking account. If you receive qualifying direct deposits of at least $250 two months in a row, you can increase your coverage to $250.
15. TD Bank – Best for Overall Banking Satisfaction
TD Bank, deemed America’s most convenient bank for its number of branches, branch hours and excellent customer service, blends the best of brick and mortar banks with easy online banking.
Most TD Bank locations are open seven days a week, including Sundays, with extended hours beyond what most brick and mortar banks provide. Most TD Bank branches are located across the East Coast, with locations in 15 different states and Washington, D.C.
TD Bank is the 7th largest bank in the U.S. based on deposits, with 1,668 branch locations nationwide. You can also reach customer service by phone, 24/7/365, which earns TD Bank high marks for banking satisfaction.
TD Bank offers six checking accounts for customers in various life stages:
TD Essential Banking
TD Convenience Checking
TD Beyond Checking
TD Simple Checking
TD 60 Plus Checking
TD Student Checking (for ages 17 to 23)
Currently, TD Bank is offering sign-on bonuses for new customers who open a TD Beyond or TD Convenience bank account. You’ll need a qualifying direct deposit (or more than one) totaling $2,500 within the first 60 days to earn $300 with TD Beyond, and a direct deposit of just $500 within the first 60 days to earn $200 with TD Convenience.
16. Schwab Bank – Best for Investors
Schwab may be best known as an investment service, but the bank was rated highest in banking satisfaction with checking accounts from J.D. Power & Associates four years running.
If you have a Schwab investment account, or are considering opening one, Schwab could be the best choice in banking for you.
The Schwab Bank Investor checking account has no foreign transaction fees, no minimums, and unlimited ATM fee rebates. Plus, earn 0.45% annual percentage yield on checking. Schwab’s savings account offers 0.48% APY.
Schwab also offers exceptionally high interest rates for CDs, with up to 5.40% APY and terms as short as 30 days. You’ll receive FDIC protection exceeding the federal maximum because you can purchase CDs from multiple banks, all through Schwab investment.
Methodology: How We Chose the Best National Banks
We evaluated a variety of banks and credit cards, taking into consideration the:
Variety of products
Interest rates
Monthly fees
ATM fees and ATM fee reimbursement
Branch locations and number of branches
Minimum deposit requirements
Fraud protection and security
We also looked at consumer reviews, and drew on the general reputation of each bank to find the best national bank.
Finding the Best National Bank
Now that we’ve explored the specifics of the best online banks and brick and mortar banks nationwide, you probably still have questions about which one is really the best national bank.
Let’s compare the three largest in the U.S. based on number of branches, interest rates, and overall banking satisfaction.
Chase vs. Wells Fargo
For the largest nationwide bank, Chase offers excellent banking satisfaction with an A+ rating from the Better Business Bureau, 4,800 branch locations, and an easy and intuitive mobile app. If you are shopping for a bank credit card, Chase also offers some of the best rewards cards available today.
Wells Fargo rivals Chase when it comes to number of branches, with roughly 4,700 locations across the U.S. It’s somewhat easier to waive the checking account fees at Wells Fargo. Wells Fargo offers higher interest rates for savings, with a 0.15% APY compared to Chase’s 0.01%.
Both banks have lower interest rates than you might find at online banks. However, if you are looking for national banks with a solid reputation, many branches, and high marks in banking satisfaction, either Chase or Wells Fargo would be a good choice.
Wells Fargo vs. Bank of America
Bank of America and Wells Fargo are the second and third-largest banks in the U.S. based on assets. BofA only has 4,000 branches compared to Fargo’s 4,700, but BofA boasts more ATMs nationwide.
BofA stands out when you join the Preferred Rewards program because you can waive the fees on your bank account and enjoy perks, bonus rewards on BofA credit cards, and rate discounts on loans.
If you have a large balance or are looking for an investing platform through your bank, BofA may be your best choice. On the other hand, Wells Fargo offers high interest rates on savings and convenient branch locations nationwide.
Common Questions
People have many questions related to whether an online bank is better than a traditional bank or whether a local bank is better than one of the largest national banks. We break it all down here.
Which is better, an online bank or a brick-and-mortar bank?
If you are looking for the highest interest rates and generous rewards programs, you are highly likely to find them at online banks. However, there are some advantages to a brick and mortar bank, including in-person service at local branches, the availability of paper checks, and easy ways to deposit cash in person or at branch ATMs.
You should expect the best national online banks and the best brick and mortar banks to have robust mobile apps, easy-to-waive fees, and fraud protection.
Make sure whatever bank you choose is “Member FDIC,” which means your deposits are insured up to $250,000 per account holder, per account type. That means joint accounts have $500,000 worth of FDIC insurance protection.
Is my money safer in a national bank vs. a regional bank (or a national credit union vs. a regional credit union)?
All banks on this list are Member FDIC, which means they are insured to the maximum allowable limit of $250,000 per account holder, per account type. Credit unions are covered up to the same limits by the National Credit Union Administration.
Many online banks are insured up to $2 million or more. These financial institutions divide cash deposits among multiple partner banks. Each bank insures deposits up to the maximum limit allowed by the Federal Deposit Insurance Corp. Read the fine print to determine your coverage limits when you choose a bank.
Beyond that, your money should be equally safe in a national bank, a smaller bank, or a credit union of any size. Also look for features such as fraud protection, fraud alerts via text, email or in the mobile app, and enhanced website security measures. You should also be able to lock and unlock your debit card in the mobile app if you misplace it or believe it may have been stolen.
What makes big banks different from smaller banks?
By definition, big banks will have larger market capitalization, which represents the total value of a bank’s stocks. Big banks will also hold more assets. For instance, Chase, which is the world’s largest financial institution, holds $3.2 trillion in assets. The second-largest national bank, Bank of America, possesses $2.41 trillion in assets. Larger financial institutions may also have more bank branches.
In many other ways, big national banks and smaller banks are similar, especially today. Customers want specific features and are unwilling to compromise on things like fee-free ATMs, no monthly fees, early direct deposit, and an intuitive mobile app.
How much interest do the best big banks pay?
In general, some of the largest national banks do not have the highest interest rates for savings and very few offer interest earning checking accounts.
Capital One 360 and Discover are two of the best national banks that offer interest on checking. To earn a higher APY with one of the largest national banks, you might want to consider CDs.
Are national banks better than other kinds of banks?
National banks aren’t necessarily better or worse than other kinds of banks. They may have more convenient branch locations, a higher number of branches, and a greater variety of products, but they might also have higher fees. Decide what’s most important to you when you choose a bank.
If you’d prefer to trust your money with one of the largest national banks, with a large market capitalization, high value, and branches nationwide, consider opening your checking and savings accounts with one of the best national banks on this list.
Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.
The Chime Credit Builder Visa® Card is issued by Stride Bank, N.A., Member FDIC, pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa credit cards are accepted.
1. Out-of-network ATM withdrawal fees may apply with Chime except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM.
5. Chime SpotMe is an optional, no fee service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each at least once every 34 days. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won’t cover non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.
Get yourself a place in the nation’s capital with the perfect outdoor spot.
There are so many great things to see in Washington, D.C., from the majesty of the monuments to the unique architecture of the everyday buildings, D.C. is filled with opportunities to soak up the sun and enjoy the great outdoors.
To ensure your search for a Washington, D.C. apartment delivers the best results, make sure you check out any and all outdoor spaces before signing your lease. A quality on-site garden or courtyard can take your time in D.C. to the next level and truly make your apartment feel like home.
To help you feel inspired, the 10 amazing apartments featured below have been hand-selected as having some of the best courtyards and gardens in the D.C. area. Find your favorite and fill out an application today.
Source: Rent. / Gables Dupont Circle
While the full outdoor space at Gables Dupont Circle is big and beautiful, this little garden-esque spot is a real hidden treasure. Fresh herbs creep up the stone flower bed, while other greenery surrounds the space. Nearby seating, under stringed lighting, gives this space a special ambiance as well.
Set in the quieter Northwest Washington neighborhood, this area boasts spectacular views while also being super walkable. It’s just steps away from great galleries and museums as well as some of the city’s best restaurants, delis, cafes and coffee shops. To keep that outdoor vibe going, there’s no shortage of parks nearby either.
Source: Rent. / The Lansburgh
An absolutely stunning courtyard awaits at The Lansburgh. This space has everything, including an eagle statue. Vibrant greenery rings the multi-tiered space with a combination of trees and bushes. At the far end, a decorative pergola also offers some shade. You’ll find a lovely fountain and plenty of seating throughout this amazing area as well.
Living within walking distance of four Metro stations makes it easy to access all D.C. has to offer from this central location. Within the Downtown – Penn Quarter – Chinatown neighborhood itself, you’re also close to just about everything, from entertainment to restaurants to historic monuments.
Source: Rent. / AVA NoMa
The courtyard is a busy place at AVA NoMa, but each section has its own special flair. For those who love outdoor games, this area features two ping-pong tables. For those who want to chill, there’s also a nice outdoor lounge with a fire pit. There’s even a small dog park for you and your furry friend to check out. Modern, metallic touches mix with hardscaping and slender trees to create a nice look and good vibes.
Providing you with easy access to downtown, finding a home in H Street-NoMa must mean food is on your mind. This is thanks to the neighborhood’s Union Market, which is within walking distance from AVA NoMA. Here, over 40 local vendors show off their culinary creativity to satisfy any palate.
Source: Rent. / Capitol View on 14th
Even if it’s not huge, most people can use a Zen garden in their lives, especially one with a trickling fountain. At Capitol View on 14th, this little pocket of relaxation comes with shaped greenery, nice seating and a multi-tiered fountain trickling down into a tranquil pool. The sound will instantly relax you and let you transition from your busy day to a chill evening.
The rest of the amenities in this Northwest Washington community don’t disappoint either. First, there are the views. You can see the Capitol building as well as other monuments from the rooftop, which is also where you’ll find the pool. There’s a great open-air kitchen up there as well and a year-round fireplace. Between these two areas, it may be hard to find a reason to come inside when the weather is nice.
Source: Rent. / Camden South Capitol
Bright yellow umbrellas add a happy pop of color to the courtyard at Camden South Capitol. They also ensure you’ll always have a shady spot to hang out in if you need it. Underneath one umbrella is a great lounge space with ample seating. The other shades the outdoor dining area, should you want to dine al fresco. This partially grassy area is also nicely landscaped.
For sports fans, living in Southwest – Waterfront has the added benefit of keeping you close to the action. You can easily head to Nationals Park for some baseball and Audi Field for some soccer. If you’re already out and exploring, make sure you head down to the waterfront for some excellent views of the Potomac River as well.
Source: Rent. / Camden Noma
Looking down onto the courtyard at Camden Noma is the best way to see just how impressive it really is. Altogether, this is a huge space, with sectioned-off areas for chilling, playing, food prepping and relaxing. A close-clipped lawn meets bushy patches of robust trees to create an inviting space whether you’re playing table tennis or grabbing a lounge chair to curl up with a good book.
You’ll find Camden Noma in the H Street – NoMa neighborhood. It’s a stress-free, luxurious community that uses modern elements to help residents feel right at home. Living here puts you near the highway, a number of parks, shops and so much more, making it an ideal spot for young professionals.
Source: Rent. / The Flats at Dupont Circle
With green space and a brick walkway both contained in the courtyard, The Flats at Dupont Circle has ideal hangout areas for everyone. For those who want to grab a lounge chair or slide into a hammock, stick to the manicured green space. For friends who want to gather and socialize, grab a cushy seat on the fringes. This is also where you’ll find the grill and outdoor eating space.
Another Northwest Washington community, living here means the luxury extends far beyond the courtyard to include an outdoor pool with sundeck and a state-of-the-art fitness center. There are even personal TV’s at each exercise machine and a separate pilates/yoga studio. The clubroom takes the fun from the courtyard indoors with its TV and kitchen to keep things popping.
Source: Rent. / Waterside Towers
For the perfect garden to walk through, make a date to explore Waterside Towers. The winding green space is full of grassy spots and excellent landscaping. Trees, bushes and small plants come together to make this whole space pop, giving you an outlet for a relaxing stroll whenever you need it. Benches throughout give you the opportunity to sit and absorb the natural beauty all around as well.
This Southwest-Waterfront community also has an impressive pond right nearby, complete with sprouting fountains, mature, bushy trees and an easy path to walk on. Living here also puts you close to all the waterfront fun beside the Potomac River where there are great restaurants and shopping right at The Wharf.
Source: Rent. / AVA H Street
A roaring fire draws the eye into the courtyard at AVA H Street. Covered to keep the flames contained, this funky and modern fire pit will keep anyone warm on a cold D.C. night. Part of the area’s lounge space, the courtyard is also where you’ll find a dual grilling station with a built-in bar and eating space. Additional groupings of seats enable a variety of large groups to gather here and enjoy themselves simultaneously.
A busy area, full of great bars and cool places to eat, Near Northeast is a neighborhood that combines culture and history with lots of shopping and fun. Living here, you’re close to the Smithsonian’s National Postal Museum, the Atlas Performing Arts Center and plenty of shopping. It’s also worthwhile to swing by the famous fountain in Columbus Circle for a photo op.
Source: Rent. / Alban Towers
A classic building with access to a wonderful green space, living at Alban Towers mixes old and new together in just the right way. The park-like garden features a rectangular strip of grass surrounded by a pebbled hardscape. Mature and lush trees line up around the edges to create a calming and isolated space for a little meditation. Additional landscaping keeps the area green and happy.
Keeping with the green theme of moving out into the Northwest Washington neighborhood, this community is close to Rock Creek Park. Another great outdoor space to explore, this 1,7540-acre city park provides a peaceful refuge as well with more beautiful trees, recreational activities and even a little wildlife. You’ll also find varying historical remnants from Civil War fortifications to colonial houses.
Grab an apartment with one of the best gardens in D.C.
There are so many special facts locals know to be true about Washington, D.C., one of which is knowing how to pick the right place to live. You need the right combination of amenities and location, and that should always include a usable outdoor space. No matter where you live in Washington, D.C., you can count on a sweet courtyard or garden if you pick an apartment from this list.
Featured Image Source: Rent. / The Flats at Dupont Circle
For past generations, “growing up” meant getting married, buying a home and starting a family.
That’s not necessarily the typical path anymore.
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Nuclear families (those defined as a husband, wife and an average of 2.3 children) used to be the majority. These days, in many cities, living solo is common and may well be the new normal.
Read on to learn more about what it means to be in charge of your own apartment household of one!
Quickly-changing times In 1950, the majority of Americans who lived alone were male migrant workers, taking jobs in sparsely-populated rural areas like Alaska or the mid-West. For these workers, living alone represented a temporary situation — one that eventually made way for a typical married life.
Fast forward to 2011. The Census from that year showed that more than 30 million people live alone, compared to the 10 million living alone in 1950. Those 30 million people represent a whopping 28 percent of all United States households. These numbers show that traditional attitudes towards family life and its milestones are changing.
Should You Live Alone or with a Roommate?
The family of one According to Eric Klinenberg, a professor of sociology at New York University who has written a book on the solo living trend, the appeal of living alone will continue to grow in our tech-obsessed society. Klinenberg suggests that because our smartphones and computers connect us to one another on a 24/7 basis, many people crave alone time. Solitude provides the much-needed respite that many use to recharge their internal batteries.
Census data on marriages also suggests a reason for so many “family of one” households. According to a 2010 Pew Research study, Millennials (the name for the current generation of 18 to 29 year olds) just aren’t in a hurry to get married. Only 21 percent of them are married, in fact. By comparison, 42 percent of Baby Boomers were married by that age, and 29 percent of Gen Xers. It seems, for younger Americans, that living alone is the new definition of “grown up” — an important milestone to cross before moving on to the challenges of adult life, including – perhaps — marriage.
Single Serving: Tips on Cooking Smart for One
Solo in the city The majority of people who choose to live by themselves find urban centers. In fact, New York City and Washington, D.C., are half-populated by single households. In cities, where resources are accessible and transportation is more communal, the stage is set for individuals to carry out their lives without the same need for at-home support that used to be almost a necessity. It’s arguable, also, that the rise of the Internet has connected people in a way that mediates the need to share a home. For some, the city becomes their home.
“Living alone” and “being alone” are definitely not the same thing. Klinenberg actually found that those who live alone are more likely to be actively social than their married counterparts. He notes that living alone tends to make people seek out more social interaction, shattering the stereotype of the “lonely single guy/girl” and reinforcing that living alone can actually be liberating.
Paying for a nursing home can seriously deplete your retirement savings. The government-funded Medicaid program can pay some or all nursing home costs, but it’s restricted to people of very limited financial means. You may be able to qualify for government assistance with nursing home costs, even if you control substantial wealth if you transfer nearly all your assets into an irrevocable trust. An irrevocable trust can protect your money from nursing home costs, but they have costs and drawbacks of their own, including permanently losing direct control of your assets. Talk to a financial advisor to learn about options for paying for long-term care.
Irrevocable Trust Basics
A trust is a legal entity many people create as part of an estate plan. The trust acts as a container for assets transferred into it by the grantor. A trustee is appointed to manage the assets in the trust for the benefit of one or more beneficiaries.
A trust can be revocable or irrevocable. You can make changes to a revocable trust after establishing it, including removing assets from the trust. Irrevocable trusts, however, cannot be changed after establishment. That means transferring assets to the trust is a one-way process. Once in, assets cannot be removed from an irrevocable trust.
Irrevocable Medicaid Trusts
Irrevocable trusts come in several varieties and can help with many different estate planning and other personal finance tasks. Medicaid trusts are the kind used to help reduce the impact of nursing home costs.
More specifically, Medicaid trusts are designed to help people qualify for Medicaid, the government health insurance program. Unlike Medicare, which is not means-tested, Medicaid is only available to people of limited financial means.
The program is administered by states, which determine their own Medicaid eligibility requirements in a variety of ways. In most, the annual income limit is $29,160 or less. This cap includes Social Security and pension benefits as well as wages and investment income. Financial resources such as bank accounts, investments, revocable trusts and real estate typically can’t total more than $2,000. People who have more income and more assets may have to spend their own assets to pay for nursing home care until their assets have declined to the point they meet the Medicaid caps.
An irrevocable Medicaid trust is designed to help someone qualify for Medicaid without having to deplete their own assets. After creating the trust, they can transfer in enough assets to bring them below Medicaid’s caps. Once they have done that, assuming they have followed the rules, Medicaid will pay some or all of their nursing home costs. In this way, an irrevocable trust can protect assets from nursing home costs.
Keep in mind that some people say it’s unethical to use trusts to shield your assets from Medicaid. Others believe it’s perfectly fine, considering the rules and laws set up around Medicaid. Ultimately, whether you use an irrevocable trust to protect your assets from nursing home costs will be based on your financial situation, as well as your thoughts and feelings on the ethics.
Limits of Irrevocable Trusts
Irrevocable trusts have a number of limitations that anyone planning to use one will want to keep in mind. These include:
One-way transfer. Assets placed in the trust can’t be taken out of the trust for as long as the grantor of the trust is alive.
Five-year limit. Assets must be transferred into the trust at least five years before the grantor seeks to acquire Medicaid eligibility. Irrevocable trusts can’t help at the last minute.
Medicaid doesn’t always pay all costs. A Medicaid patient in a nursing home still has to use their own income to pay for most nursing home costs. Medicaid will often pay for most and sometimes all of the costs, but patients usually shoulder some of the financial burden.
Not all nursing homes qualify. Medicaid only pays for care in certain approved nursing homes.
Other Ways to Protect Assets from Nursing Home Costs
An irrevocable trust is not the only tool available to help with nursing home costs. Here are some of the alternatives:
Long-term care insurance can cover some or all nursing home costs without having to consider Medicaid eligibility.
Medicaid-compliant annuities can be used to generate income that isn’t included in Medicaid’s income assessment.
A life estate transfers ownership of assets in your estate to a spouse, removing them from consideration when determining Medicaid eligibility.
Financial gifts to family members can reduce your net worth enough to meet Medicaid’s guidelines.
Bottom Line
An irrevocable trust can help you avoid having to use your own assets to pay for nursing home care by making you eligible for Medicaid. Medicaid can pay some or all of your costs, but only if you meet strict financial guidelines for income and assets. Transferring assets into an irrevocable trust, called a Medicaid trust, can help even people with significant assets meet these guidelines, But once assets are transferred to an irrevocable trust, they can’t be retrieved from the trust.
Tips for Long-Term Care Planning
A financial advisor can help you design a strategy for covering long-term care costs using an irrevocable trust, if appropriate, as well as other methods. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Whether you are retired or still working, keeping a budget is a basic tool to help you for prepare for future needs such as paying for a nursing home. SmartAsset’s Budget Calculator can tell you how your spending stacks up to other people in your area.
If you thinking about purchasing long-term care insurance, be sure to review our picks for the top long-term care insurance providers of 2023.
Mark Henricks
Mark Henricks has reported on personal finance, investing, retirement, entrepreneurship and other topics for more than 30 years. His freelance byline has appeared on CNBC.com and in The Wall Street Journal, The New York Times, The Washington Post, Kiplinger’s Personal Finance and other leading publications. Mark has written books including, “Not Just A Living: The Complete Guide to Creating a Business That Gives You A Life.” His favorite reporting is the kind that helps ordinary people increase their personal wealth and life satisfaction. A graduate of the University of Texas journalism program, he lives in Austin, Texas. In his spare time he enjoys reading, volunteering, performing in an acoustic music duo, whitewater kayaking, wilderness backpacking and competing in triathlons.
It’s time to give yourself a 10-second financial check-up: are all of your hard-earned dollars earning interest? Even your short-term savings that you’ll need in two years or so?
Savvy investors know that every dollar deposited at a bank, brokerage, or financial institution should be making money — and that includes your short-term savings, cash investment balances, even your checking account. If not, you should be looking for somewhere else to store your dollars.
Let’s look at where best to stash your short-term savings.
What’s Ahead:
High-yield savings accounts
High-yield savings accounts pay up to 5x the national average savings rate and are convenient to open and manage. You can transfer money in and out electronically from your checking account or other bank accounts — a process that rarely takes more than two business days.
Most high-yield savings accounts have no fees or minimum balance requirements, so there’s no excuse for not using one for short-term cash reserves.
You can check out our full list of the best high-yield savings accounts, but here are three of our favorites that you may want to consider for short-term savings:
Aspiration Bank
Aspiration Bank is a great bank if you love earning rewards. And, because this bank plants trees for you with your rounded-up change, you can pride yourself on taking care of the environment through your banking.
You only need a minimum balance of $10 in the account and can earn up to 5.00% APR, depending on the account you have — they have a free account and a subscription account (Aspiration Plus) that gives you access to more of their products as well as a higher APY.
Given these easy terms and high returns, the Aspiration Plus Savings Account can be a very lucrative place to stash your short-term savings.
Learn more/apply or read our full Aspiration Bank review.
Citi Accelerate® Savings
The Citi Accelerate® Savings has one of the highest APYs when it comes to high-interest savings accounts, coming in at 2.20% APY. And their monthly fee is waived if you have at least $500 in your account, so it’s a great option if you have a larger short-term savings goal in mind.
And since there’s no minimum opening deposit, they’re great for just about anyone who wants to start socking away money every month.
Unfortunately, the Citi Accelerate® Savings is only available in certain U.S. markets. If you live in California, Connecticut, Maryland, Nevada, New Jersey, New York, Virginia, Washington, DC, or select markets in Florida or Illinois, you’ll need to go with an alternate account option.
Learn more/apply.
Capital One 360 Performance Savings
If you’re looking for a more full-service experience with your high-interest online savings account, consider Capital One 360 Performance Savings. They have plenty of services to help you out with your savings, and an APY of 3.00%. Plus, there are no minimums or monthly fees.
It’s a great option if you’re starting out with a low balance and you want to increase it until your short-term savings project is completed.
Read our full Capital One 360 Savings review.
Cash management accounts
A cash management account is an account that’s held by a robo-investor. It’s not a checking, savings, or investment account. Instead, the brokerage firm holds your money for you to use. They issue debit cards just like a checking account, but they have higher interest rates than those types of accounts.
These are a great option if you’re already using a robo-advisor for your long-term investments. You can find them at companies like Wealthfront, which has a cash account.
Short-term bonds
Short-term bonds are issued either by corporations or by the government. Each bond has different terms, so you’ll want to research what you’re signing up for before you make a purchase. But they’re overall low-risk investments.
But what is a bond? Good question. Bonds are basically IOUs that a company or government gives you on a debt. These groups are trying to fund something, but need capital, so they sell off bonds and tell you that after X amount of years, they’ll pay you Y in interest.
Read more: How does a bond work? A simple (and informative) guide
T-bills
Treasury bills, or T-bills, are another great short-term savings storage plan. They work similarly to bonds — you buy them from the treasury, and then you wait until they mature. Once they mature, you sell them and receive your money back, plus any interest.
You can buy them in intervals of 1, 4, 8, 13, 26, and 52 weeks, so they’re great for short-term projects that take about a year for you to save for.
Money market accounts
Money market accounts, also known as MMAs, are similar to both checking accounts and savings accounts.
How does that work? Well, you have interest rates that are higher than checking accounts and more on par with savings accounts, but you’re able to get a debit card to access your funds like a checking account. However, there is a limit to how many transactions you can make a month.
Money market accounts are good for short-term savings because they have higher accessibility than a savings account, but are low-risk. As long as you keep money in the account — and stay below the monthly withdrawals limit — you’ll earn interest on the account.
Read more: Best money market accounts
Certificates of deposit
Savers who are looking for the best return on their money on a slightly longer-term basis (minimum three months) should take a look at a certificate of deposit. CDs have terms that typically run from a period of three months to five years. Rates increase as the CD term gets longer.
You can get the best rate on a CD by shopping online, as these tend to change quite often. Most CDs will have minimum deposits of $500 or more, and patient investors can get a higher rate the longer their term.
Browse today’s best CD rates.
To reap the benefits of long-term CD rates with short-term savings, check out this article on CD laddering, which explains how to build your own.
Should you invest your short-term savings?
When you save money in an FDIC-insured bank account, your money is guaranteed not to lose value. When you invest money, you’re taking on risk for the chance at a greater return. You might very well earn a much better return on your money than you could with a bank, but you could also end up with less money than you put in.
In general, you want to save money you’ll need in the short term and invest money you won’t need for a long, long time. That’s because the risk of losing money on an investment diminishes the longer you’re able to hold that investment. We all know the stock market is volatile. If you put your money in the day before a crash, you could lose a big chunk of value overnight. If you leave that money invested for 30 years, however, you’ll likely come out way ahead (despite the initial crash!)
Risk tolerance is a personal thing, but my philosophy is that I never invest money I’ll need in the next two years. If don’t need the money in the next two years but will need it in the next five years (for example, money I’m saving for a future car purchase), I might invest the money, but very conservatively.
If you’re looking for a simple way to save money for a short-term goal, but you’d rather take your chances investing it rather than parking it at a bank, check out the Acorns app. You just download the app, link a bank account, answer a few questions, and you’re an investor. You can connect the app to any number of debit or credit cards, and Acorns automatically rounds up each of your purchases and invests that amount on your behalf. While this won’t make you rich, it can help any first-time investor make a little extra cash.
The bottom line
For most people, the best place to put short-term savings is an online savings account that pays a fair interest rate.
But other options, like certificates of deposits, money market accounts, short-term bonds, T-bills, and cash management accounts are all good alternatives you may not have considered for saving up for a short-term goal.
Featured image: Julia Sudnitskaya/Shutterstock.com
It is no secret that housing inventory is low. As of June 2, there were 433,104 single family homes on the market nationwide, according to data from Altos Research.
And while this situation is certainly far from ideal, according to a report published Thursday by the National Association of Realtors and Realtor.com, even with the existing level of homes available for sale, the housing affordability and inventory shortage issues wouldn’t be so severe if there were enough homes for buyers at all income levels.
In April 2023, data from NAR and Realtor.com showed there were roughly 1.1 million homes listed for sale. Of those 1.1 million properties, 25% had a price lower than $256,000, which is the maximum price of a home that households earning the national median income of $75,000 can afford.
Over half (51%) of U.S. households earn $75,000 or less, meaning that in a balanced market, 51% of the homes for sale would be affordable to buyers in this income bracket.
Based on the report, the housing market needs an additional 319,460 listings priced under $256,000 in order for the market to be balanced. In other words, the U.S. needs to add at least two homes that are affordable for middle-income buyers (up to $256,000) for every home that is listed above $680,000.
As income levels increase, however, the disparity decreases between current inventory and the inventory needed for a balanced market. For example, buyers earning $250,000 can currently afford to buy 85% of listings compared to 93% in a balanced market.
This situation has only gotten worse over the past five years. In April 2018, there were about 810,000 listings that middle-income buyers were able to afford, just 150,000 listings shy of a balanced market.
El Paso, Texas; Boise City, Idaho; Spokane, Washington; Cape Coral, Florida; and Lakeland, Florida round out the top five metropolitan areas with the larges supply shortage of homes with a price lower than $260,000. In El Paso, buyers earning $75,000 can afford to buy 16% of listing, when in a balanced market they should be able to buy 66% of listings. In Boise City, they can afford just 2% of listings when a balanced market calls for them to be able to afford 50% of listings.
On the other side of the spectrum, in the Youngstown, Ohio-Pennsylvania market, buyers earning $75,000 can afford to buy 72% of listings, when a balanced market calls for this cohort to be able to afford 66% of listings.
Akron, Ohio (where 61% of listings are affordable and 58% are needed for balance); Toledo, Ohio (where 61% of listings are affordable and 60% are needed for balance); Cleveland, Ohio (where 59% of listings are affordable and 58% are needed for balance); and Syracuse, New York (where 54% of listings are affordable and 55% are needed for balance) round out the top five.
When parsed by race and ethnic groups, NAR and Realtor.com found that Black Americans are the group that is furthest away from equilibrium out of any cohort. Two-thirds of Black Americans earn $75,000 or less, and these buyers can only afford 22% of homes for sale.
Meanwhile, 48% of white Americans fall into the same income bracket, and they can also afford to buy 22% of listings. This means that Black Americans would need 20% more listings with a value of up to $256,000 than white Americans in order to be at equilibrium.
By comparison, Hispanic Americans need roughly 11% more homes listed for sale than what white Americans need to reach equilibrium. When broken out by metro area, McAllen and El Paso in Texas; Oxnard and Riverside in California; and Tucson, Arizona are the areas with the smallest housing affordability and availability inequalities among white and Black households earning less than $75,000. The report attributes this to these areas being expensive for all racial/ethnic groups
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Rent control apartments in DC provide an opportunity for tenants to enjoy stability and predictable rent increases. Let’s delve into the details of rent control and explore how you can find these sought-after apartments in the city.
What is Rent Control in DC?
Rent control in DC applies to all rental housing, with a specific focus on apartments built before 1975. Apartments constructed after this year are exempt from rent control regulations. For pre-1975 apartments, rent control limits the annual rent increase that landlords can impose.
Qualifying for a Rent Control Apartment
The great news is that rent-controlled apartments are available to everyone, regardless of income. You won’t need to go through any additional steps during the application process to qualify. However, during lease signing, you may be required to sign a few extra documents or disclosures.
How Does Rent Control Work in DC?
Rent control in DC ensures that your annual rent increase doesn’t exceed a limit set by the city government. Considering that market rents in the District can rise by 10%-20% depending on demand, having a cap on your rent increase is highly advantageous.
In reality, the actual rent increase under rent control is often significantly lower than what you would face in a market-rate apartment. The annual adjustment is determined by combining the Consumer Price Index (CPI) with a percentage increase ranging from 2% to 10% of your current rent. However, the total increase, including CPI and the additional percentage, can never surpass 10%.
For example, suppose your rent in 2023 was $1000. On your lease renewal in that year, your rent could have increased by a maximum of $89 (considering a CPI of 6.9% and an additional 2% allowed by the city).
It’s common for tenants to remain in rent-controlled apartments for extended periods. Just think of Monica and Rachel’s apartment in Friends! However, it’s important to note that these apartments tend to be older and may lack many amenities found in newer luxury buildings. Be prepared for a more basic living experience, such as window air conditioner units and the absence of garbage disposals or dishwashers.
Finding Rent Control Apartments
To find the best deals on rent control apartments in DC, consider the following options:
Check out our recommended apartments Check out this article to find a few.
Hit the streets and explore neighborhoods that interest you. Areas like Adams Morgan, Cleveland Park, Van Ness, and Glover Park have a significant inventory of rent control units.
For more information on affordable apartments, consult our comprehensive Guide To Washington, DC Affordable Housing Options.
By understanding the benefits of rent control and being proactive in your search, you can secure a budget-friendly apartment in DC while enjoying the stability it offers. Keep in mind that these units may be scarce, but with patience, persistence, and diligent searching, you can still find great deals.
Amazon and the Amazon logo are trademarks of Amazon.com, Inc, or its affiliates. Rental providers will not refuse to rent a rental unit to a person because the person will provide the rental payment, in whole or in part, through a voucher for rental housing assistance provided by the District or federal government.
More than any time since before the Great Financial Crisis, the disconnect between Washington policy makers and the actual reality in the mortgage markets is widening. The lack of real-world knowledge and comprehension by key agency heads in the Biden Administration begs the question whether Washington is a help or a hindrance as the industry grapples with rising interest rates and mounting credit loss expenses.
For example, Consumer Financial Protection Bureau head Rohit Chopra said in May that “a major disruption or failure of a large mortgage servicer really gives me a nightmare.” He made these intemperate comments during CBA Live 2023, a conference hosted by the Consumer Bankers Association.
Like his predecessor Richard Cordray, Chopra’s focus is political rather than on any real threat. But of course, progressive solutions require problems. Three large and mismanaged depositories failed in the first quarter of 2023, yet progressive partisans like Chopra, Treasury Secretary Janet Yellen, and Federal Housing Finance Agency head Sandra Thompson ignore the public record and continue to fret about nonexistent risk of contagion from mortgage servicers. Really?
The big risk posed by mortgage servicers, of course, is to shareholders and creditors, not to consumers. Witness the abortive auction for Specialized Loan Servicing by Computershare of Australia. The offering of private label servicer Select Portfolio Servicing byCredit Suisse and now UBS AG is another example of shareholder value destruction. Homepoint was basically a liquidation from the 2021 IPO.
When progressive politicians in Washington yowl about risk in the financial markets, it is usually really about risk to the personalities in question and financing their careers. There is no appreciable risk to consumers or the taxpayer from mortgage servicers, which like Black Rock and UBS are basically asset managers working for a fee. Bureaucrats like Chopra simply raise operating costs.
More than any real world problem posed by IMBs, it is the government in all of its manifestations that poses a significant risk to the world of mortgage finance and the housing sector more generally. Washington regulatory agencies seek to stifle the markets, limit liquidity and impose additional capital rules, strictures that must inevitably reduce economic growth and access to affordable housing.
The good news, of course, is that many of the proposals from the FHFA, HUD and other agencies are effectively modified or rolled back entirely (such as the debt-to-income calculation for loan-level pricing adjustments) once the industry trades and large issuers engage.
In this case, Washington listened, but only after taking an inordinate amount of time and resources from private issuers, resources that are badly needed elsewhere. Would it be too much to ask for government agencies to vet ideas thoroughly before a public proposal?
In other cases, however, as with the risk based capital rules proposed by Ginnie Mae and the capital rules already approved for the GSEs, Washington is definitely not listening. But then again, the industry did a lousy job of pushing back on the capital rules for Fannie Mae and Freddie Mac, to our great disadvantage.
Despite the withdrawal of the LLPAs, personnel at the GSEs are still pressing issuers for “mission loans,” meaning loans to underserved and generally low-quality borrowers that are sought by the Biden Administration. Some issuers approaching the GSE cash windows have been told that they will not receive attractive pricing unless the pools include mission loans.
But sadly, there are few cases where a lender could or should advise a consumer to take out a conventional loan vs. FHA/VA. And the execution from the GSEs is hardly attractive.
The changes in GSE loan pricing and other policy changes reflect the FHFA’s focus on implementing the enterprise capital requirements put into place by Thompson, even while paying lip service to progressive goals. Garrett Hartzog, Principal of FundamentalAdvisory and Consulting notes in a comment in NMN:
“The Enterprise Regulatory Capital Framework is going to dramatically transform GSE pricing in ways the industry hasn’t begun to contemplate. Understanding the ERCF means being able to mentally reconcile increasing risk-based pricing (the DTI-based fee) and decreasing the level of risk-based pricing (the credit score/LTV matrices). What’s more, people need only read Fannie Mae and Freddie Mac’s comment letters during the rulemaking process to understand that g-fees will ultimately experience a dramatic increase as a result of the ERCF.”
If FHFA raises guarantee fees for the GSEs in line with the capital rule, then Fannie Mae and Freddie Mac will no longer be competitive for larger, high-FICO loans. But poor execution at the cash window and higher g-fees are just some of the issues facing the GSEs as defaults rise and loan put backs also increase.
A number of issuers complain about an increasing tide of loan repurchase requests coming from the GSEs, Fannie Mae and Freddie Mac. One prominent industry CEO known for his ability to “see around corners” laughs at the fuss so far and told NMN: “The GSEs are just practicing for the real push back. This is just a dress rehearsal.”
Meanwhile, the FHFA has just rolled out a new program whereby all large conventional issuers must have pre-funding quality control (QC) in place for all loans going through their systems by Labor Day. For larger correspondent shops, this could mean dozens of new hires and hundreds of thousands in new annual expenses. Apparently the QC personnel at the GSEs did not know about the change.
One angry issuer tells NMN: “If your volume is mostly FHA/VA, it does not matter to the FHFA. They want QC on all loans. If my volume is mostly delegated correspondent, it does not matter. I’m buying closed loans, but it does not matter.”
Most issuers contacted by NMN say they cannot comply with the new QC edict from FHFA. The lack of appreciation for market realities within the FHFA mirrors the situation in much of official Washington, with regulators working against the best interests of consumers and the entire private mortgage and housing industry by reducing volumes and liquidity.
Ironically, even as the FHFA is becoming the focus of increased industry concerns, Ginnie Mae President Alanna McCargo is now focused on problems faced by issuers. The new partial claim regime put in place by the FHA to help finance loss mitigation for Ginnie Mae servicers evidences this concern.
The CEO of one lender that focuses on underserved communities told NMN: “Ginnie Mae understands that they need to let us run our businesses as delinquency rates rise. Until interest rates fall and volumes improve, this is a war of attrition among lenders.”
Lenders hoping for lower rates in 2023 and that are dragging their feet on cost cutting will not survive in many cases. With the markets extending spreads on late vintage production, the MBS with 6% and 7% coupons, higher for longer seems to be the plan in residential mortgages in 2023. Hope is not a strategy.
