Sallie Mae became 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, handling both federal and private sector loans.
In 2004, Sallie Mae became a fully private sector company without GSE (Government-Sponsored Enterprise) status.
Today, their product suite covers a large range of financial services and products – from private education loans and college savings programs to banking services and insurance programs.
In this review, we will focus on the FDIC-insured deposit accounts offered by Sallie Mae Bank along with the Sallie Mae CDs (certificates of deposit) offered via the Raisin portal.
To see if one of their CDs, savings account or money market account is right for you, continue reading below.
Sallie Mae CD Rates + Account Details
Sallie Mae offers 11 standard CDs (certificates of deposit) with terms ranging from 6 months to 5 years.
All of their CDs are federally insured by the FDIC up to the applicable limits and come with a minimum deposit requirement of $2,500.
To put Sallie Mae’s CD rates (above) in perspective, the current national average for a 12 month CD sits at 1.72% and the current average for a 5 year CD sits at 1.37% according to FDIC data.
How Do Sallie Mae’s CD Rates Compare?
Take a look at the table below to see how Sallie Mae’s best CD rate compares with the best CD rates from other FDIC-insured online banks.
|Best CD Rate (APY)
|First Internet Bank
How Much Can You Make with a Sallie Mae CD?
The amount of money you can earn with a Sallie Mae CD depends on your deposit size, the CD term you select and its APY (annual percentage yield). Take a look at the table below showing potential earnings based on a $25,000 deposit.
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.
The interest rate and APY will be determined on the date you fund the CD, 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 CD Rates Powered by Raisin
For better CD rates from Sallie Mae, you may want to consider opening a certificate through the Raisin portal (formerly SaveBetter).
Raisin is a fintech company that has partnered with several FDIC-insured banks and NCUA-insured credit unions to offer special deposit accounts, generally with oddball terms and slightly better yields.
Raisin helps consumers in the United States and the European Union access a number of competitive FDIC-insured deposit products from various banks and credit unions. Consumers can then manage all of their CDs and deposit accounts from one single account – the Raisin account. This also increases overall FDIC coverage leveraging the insurance from multiple institutions.
CD Rates via Raisin
|10 month No Penalty
|14 month No Penalty
If you open a CD with Sallie Mae through Raisin the minimum deposit requirement is just $1.00.
The “No Penalty” CD is a liquid CD without any early withdrawal fees meaning you can access your funds anytime penalty free.
Money Market Rate + 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 from most money market accounts that tie yields to balances.
Money Market Rate
To put the APY (above) in perspective, the current national average for a money market account sits at roughly 0.63% and a savings account sits at 0.42% according to FDIC data.
That said top yields from online banks are now hovering around the 5.00% APY mark.
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.
High Yield Savings Account Rate + 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.
High Yield Savings Rate
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 then 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 3.8 stars on Android and an impressive 4.5 stars on the App Store.
Sallie Mae’s SmartyPig account has a separate app and also receives high marks.