[6/4: Rates are changing, and may vary depending on when the account was opened. Rate shown below preserved for posterity.]

AARP Financial's savings rates have been mentioned in other threads, but I'd like a discussion focused on just these accounts.

AARP Savings Rates

High yield savings pays 4.5% APY, and Jumbo Secure MMA pays 4.75%.

I am a AARP member already, but am wondering, what's the catch? How can they pay so much more than anyone else? If I go to the trouble of setting up an account, are they likely to drastically lower the rate next week? I am not normally a rate-chaser, but these rates are so much higher than anyone else, it makes you wonder.

Info, thoughts, comments?

Edited to add: I decided to try this out myself and opened an account online. Details and updates in the thread.

Thx for posting this gem. Not sure why the 5yr CD rates are lower than liquid savings:

5-Year (260-Week)
$500 $500-$19,999 3.93% 4.00%
$20,000 $20,000-$99,999 4.03% 4.11%
$100,000 $100,000+ 4.08% 4.16%

I think you're right to be suspicious about the high rates offered on the liquid end. It could very well be temporary and serve to draw in customers. However, because it doesn't say this is a promo, makes you wonder what the real reasons are behind the higher than industry average rates. Could it be distressed capital raising?? Since it is FDIC insured that should buffer any negative concerns about safety.

Also, I totally was not aware AARP had a "bank" arm. Was a member but let my membership lapse. Seems like AARP these days are operating as a quasi bank/insurance more than a senior advocate organization. However, given the demographic it targets, it is a no brainer that they would take the opportunity to peddle bank and insurance products the hardest. Quite a captive lucrative target group ripe for good pickings

I read that the products were offered via Huntington NB and UFB Direct, but why are the AARP rates so much higher than the equivalent products at those banks? Who in the world is managing a MM account that produces 4.75%?

UncaMikey said:...

I am a AARP member already, but am wondering, what's the catch? How can they pay so much more than anyone else? If I go to the trouble of setting up an account, are they likely to drastically lower the rate next week? I am not normally a rate-chaser, but these rates are so much higher than anyone else, it makes you wonder.
...

I'm not putting down seniors or older members, but how many people aged 50+ trust an internet bank (non-local bank), not already have their money tied up, or are even aware that the local 2.5% interest rates are bad?

poo said:I'm not putting down seniors or older members, but how many people aged 50+ trust an internet bank (non-local bank), not already have their money tied up, or are even aware that the local 2.5% interest rates are bad?

LOL, you're joking, right? I'm in my late 50s, and I'm on the internets all by myself right now, writing this FW post, and there's not a young whippersnapper here to help me out. Amazing, huh?

Seriously, you need to venture out of your age cohort, whatever it is. You may be surprised by what you find.

poo said:UncaMikey said:...

I am a AARP member already, but am wondering, what's the catch? How can they pay so much more than anyone else? If I go to the trouble of setting up an account, are they likely to drastically lower the rate next week? I am not normally a rate-chaser, but these rates are so much higher than anyone else, it makes you wonder.
...

I'm not putting down seniors or older members, but how many people aged 50+ trust an internet bank (non-local bank), not already have their money tied up, or are even aware that the local 2.5% interest rates are bad?

Why do you need to be 50+? Hell there was tons of people on this board who claimed to be teachers just to get a slightly higher rate from BOA even tho they were not teachers. Do you think they are going to care and not lie about there age? The difference between this savings account and next highest savings is almost 200 bps currently which was a much larger margin than 100 bps for 60 days that the NEA account gave over the AAA account.

poo said:

I'm not putting down seniors or older members, but how many people aged 50+ trust an internet bank (non-local bank), not already have their money tied up, or are even aware that the local 2.5% interest rates are bad?

Hey, we old guys invented the freakin' internet!

dolmar said:

Why do you need to be 50+? Hell there was tons of people on this board who claimed to be teachers just to get a slightly higher rate from BOA even tho they were not teachers. Do you think they are going to care and not lie about there age? The difference between this savings account and next highest savings is almost 200 bps currently which was a much larger margin than 100 bps for 60 days that the NEA account gave over the AAA account.

By 200 basis points do you mean 45-70 basis points?

verruckterBaum said:dolmar said:

Why do you need to be 50+? Hell there was tons of people on this board who claimed to be teachers just to get a slightly higher rate from BOA even tho they were not teachers. Do you think they are going to care and not lie about there age? The difference between this savings account and next highest savings is almost 200 bps currently which was a much larger margin than 100 bps for 60 days that the NEA account gave over the AAA account.

By 200 basis points do you mean 45-70 basis points?

Sorry I was not aware any place was paying rates as high 4% and was comparing to BOA/Chase/Citi/Wachovia/Wells Fargo and WAMU savings accounts.

Anyone notice the official AARP website has no links to aarp savings?

http://www.aarp.org/aarp_benefits/offer_financial/

Could this be a scam?