CIT Bank: A Review
When I opened my current checking account a few years ago, I thought the rate was great. Now I'm seeing banks with even higher rates and I'm ready to rethink my banking decision. Of course, interest rates aren't the only reason to switch banks; but there are institutions with numbers that are pretty tempting, and CIT Bank has caught my attention.
By way of background, CIT Group was founded in 1908 and currently focuses a lot of its energy on business loans and small-business clients. In 2009, CIT Group filed Chapter 11 bankruptcy, but CIT Bank was not part of that bankruptcy. Still, experts indicate that CIT is a safe bank, and further, CIT Bank is FDIC-insured for up to $250,000 per account.
High-interest savings accounts
High-interest rates seem to be CIT's biggest draw; and with a minimum deposit of just $100, their rates are accessible to most everyone. Premium rates are available for those who maintain a daily balance of $25,000 or more too. I especially like the fact that CIT compounds interest daily, but also that deposits and withdrawals can be done easily by linking to an existing account at another bank. And what about fees? There are no monthly maintenance fees. Good job!
Still FDIC-insured, CIT's Term CDs have even better rates - and with a minimum of $1,000, a certificate of deposit account provides better earning potential for longer terms. Other banks have much higher minimums for much lower rates. Interestingly, the 6-month CD requires $1,000 to open but may offer a lower interest rate than their regular online savings account. So I imagine it's better to simply open one of their high-interest savings accounts as opposed to a 6-month CD, but for 1-year terms or longer, the rates are competitive.
Customers with $100,000 or more to deposit have the Jumbo CD option, and the same great features apply - interest compounded daily, FDIC insurance up to the legal limit, and no maintenance fees.
Custodial accounts and IRAs
I didn't expect to find that CIT's savings accounts (and most CDs) can be set up as either a Traditional or a Roth IRA, so you can participate in the tax advantages. There's also a simple breakdown of the differences and benefits of the Traditional IRA and the Roth IRA so you can compare the two and decide which is best for you. Their custodial account allows you to save money for a child under 21, which is another way to save money on taxes.
I like that CIT offers these additional savings accounts, because if you're planning to open one anyway, having everything in one place seems really convenient.
CIT's website is a little simplistic, but it's easy enough to navigate. Unlike other bank websites, they don't appear to have a chat function for quicker help. But perhaps with the type of products offered, which are generally low-maintenance accounts, there isn't a great need for instant customer service or even extensive online banking.
Representatives are available at extended business hours and on weekends, however. These hours seem convenient enough; and upon giving them a call to inquire about transfers, their representatives were friendly and helpful.
If you have the necessary minimum, CIT bank's high-interest rates seem worthwhile. They offer IRA and Jumbo CD options; and while those options may not yield as much as investing in a mutual fund, there is a convenience factor that is appealing. For someone just getting their feet wet in the world of saving and investing, this setup might make for an easy, streamlined experience. CIT Bank's standard savings account has an exceptional interest rate, and while a $100 minimum is required to open and maintain an account, there are no account-maintenance fees. This makes for an easy way to earn a significant amount of interest on your savings.