[Update September 2021: Sallie Mae raised the rates on many of their CDs with terms of 12 months and greater. The biggest increases came with their 12 and 36 month CD which now yield 0.60% APY and 0.70% APY, respectively. They also raised their money market rate by 0.10% APY to the current 0.40% APY. See all of their current rates below.]
Sallie Mae has become a household name as the largest originator of student loans in the country.
Founded in 1972 as the Student Loan Marketing Association, Sallie Mae operated with government sponsorship by handling both federal and private sector loans.
Some may remember their Federal Stafford and Federal Perkins loans coming from Sallie Mae. However, Sallie Mae started the path of incorporation as a private company during the 90s and completed it in 2004, severing their operation from the government.
Today, their product suite covers a large range of financial services from private education loans and college savings programs to banking services and insurance programs.
In this review, we’ll focus on the savings side of Sallie Mae Bank. Sallie Mae is a member of the Federal Deposit Insurance Corporation and currently offers several types of FDIC-insured savings accounts for a variety of needs: the SmartyPig savings account, certificates of deposit, money market, and high-yield savings accounts are all on the menu with Sallie Mae.
Please note the SmartyPig savings account will not be covered here. Use the link above to read more about that account.
In this post you'll learn:
Sallie Mae CD Rates + Account Details
If you’re looking to lock-in an interest rate, a certificate of deposit may be the way to go.
Sallie Mae was named as one of the best banks for certificates for deposit in 2020 by GOBankingRates.
Although their CD rates have been more competitive in the past, they still feature returns that beat the national average(s) for their respective terms by decent margins.
To put Sallie Mae’s CD rates (above) in perspective, the current national average for a 12 month CD sits at 0.14% APY and the current average for a 5 year CD sits at 0.24% APY according to recent FDIC data.
As you can see from the table, there is a wide range of terms to choose from but the current yields don’t vary much by term.
Upon the maturity of your Sallie Mae CD, you’ll have a 10 calendar day grace period during which you can withdraw funds from your CD account without penalty. If no action is taken within the 10 day grace period, the funds will automatically renew into the same CD with its current rate.
Locking-In CD Rates
The interest rate and APY will be determined on the date you fund the CD account, not the date you open the account. However, you will receive the higher interest rate of the date your account opened or was funded if the first deposit occurs within ten days from the opening date.
Once your interest rate is set and fixed, you will be paid this rate until maturity. Interest is compounded daily and credited to your account monthly.
The interest begins to accrue on the same business day if the deposit is received before 11:00 PM ET. If the deposit occurs after 11:00 PM ET on a business day or non-business day, the deposit is considered received on the next business day.
Early Withdrawal Penalties
If your CD account has a maturity of 12 months or less, the penalty is equal to 90 days of simple interest on the amount withdrawn. If the CD account has a maturity greater than 12 months, the penalty will equal 180 days of simple interest on the amount withdrawn.
In circumstances such as death or incompetence of the account holder, the law may permit an early withdrawal penalty waiver.
Sallie Mae Money Market Rates + Account Details
Sallie Mae’s money market account is similar to their SmartyPig account but with a few more features. For example, you can write checks from the money market account plus earn a slightly higher rate.
Unlike Sallie Mae’s CDs there are no minimum deposit requirements to open a money market account. The APY you receive applies to all balances as well, which is different than most money market accounts that tie yields to balances.
Sallie Mae Money Market Account Rates
|Monthly Balance||Minimum Deposit||APY|
To put the APY (above) in perspective, the current national average for a money market account sits at roughly 0.11% APY. On top of the respectable yield, the lack of both minimum deposit and monthly balance requirements make this an attractive account. Keep in mind money market rates are variable and can change at any time without notice.
You may deposit or withdraw money via:
- EFT, or
- Wire Transfer.
There is a maximum of 6 transfers or withdrawals (a combination of either) during any calendar month or statement cycle per Federal Regulation D. Please note that if using your Sallie Mae money market account to repay loans at Sallie Mae, there is no limit in the number of transfers you may make.
Sallie Mae Fee Schedule
- Check Order Charge (for orders placed after account opening; orders placed at the time of account opening are free): $5
- Stop Payment Charge: $15
- Returned Check Fee: $5
- Insufficient Funds (NSF) Fee: $19
- Wire Fee: $20 (United States only). Please note that the receiving bank may charge a wire fee on their end. Sallie Mae will not allow international wire transfers.
Sallie Mae Money Market Promotional Offers
Sallie Mae may offer a bonus interest rate and APY from time to time for their money market account customers. The promotional period’s bonus rate will be paid regardless of your balance and discontinued after the promotional period has ended. Your interest rate and APY will then revert to Sallie Mae’s current interest rate and APY. Promotions are not valid with other offers or promotions unless otherwise stated.
Sallie Mae High Yield Savings Account Rates + Details
The high yield savings account is similar to the SmartyPig and money market account in that it has no minimum balance/deposit requirements or monthly maintenance fees.
The rate is slightly lower than the money market account, but still handily beats the current national average for FDIC-insured online savings accounts.
Sallie Mae High Yield Savings Account Rate
|Monthly Balance||Minimum Deposit||APY|
Rates are compounded daily and credited to your account monthly. As with the money market account the APY is variable and subject to change at any time without notice.
You may withdrawal or deposit money via:
- EFT, or
- Wire Transfer
The same 6 transaction limitation applies to the high yield savings account. This applies to both withdrawals and deposits (a combination of either) per federal regulation.
• Returned Check Fee: $5
• Wire Fee: $20 (United States only). Please note that the receiving bank may charge a wire fee on their end. Sallie Mae will not allow international wire transfers.
Banking Experience and Customer Sentiment
Sallie Mae has just one physical location in Utah, which is their headquarters. So if you value in-person banking this institution likely isn’t for you.
That said, if you value respectable rates and low maintenance accounts that can be managed 100 percent digitally than Sallie Mae deserves your consideration. Their rates are regularly among the top online offers available and their accounts have received a number of awards from third party sites.
They receive just 3.6 starts on Android, but an impressive 4.6 stars on the App Store.
Sallie Mae’s SmartyPig account has a separate app and also receives high marks.
Sallie Mae has a variety of options in terms of deposit accounts. All of their variable rate products feature $0 minimum deposit and monthly balance requirements which make them available to pretty much anyone.
Their CDs feature above average rates, but better APYs can be locked-in through other online institutions or credit unions.