The Federal Savings Bank Review 2021

Published January 2021 by Brian Beers

AT A GLANCE
4.3

Bankrate Score

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Top CD rates

The Federal Savings Bank is a good bank for consumers looking for a mortgage, especially if they are active-duty military or veterans. It’s also good for savers looking for competitive rates who prefer to do their banking online, as TFSB only has two traditional retail branches for customers.

  • CDs
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    5.0
  • Savings
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    3.9
  • Checking
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    4.8
  • MMAs
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    3.0
  • MORE HIGH-YIELD OPTIONS
    MORE HIGH-YIELD OPTIONS
    Goldman Sachs Bank USA

    Member FDIC

    Savings account

    0.50 % APY

    $ 0

    Min. balance for APY

    Goldman Sachs Bank USA

    Member FDIC

    CD

    0.65 % APY

    9mo

    Term

    $ 500

    Min. deposit

    Goldman Sachs Bank USA

    Member FDIC

    CD

    0.55 % APY

    1yr

    Term

    $ 500

    Min. deposit

    Overall

    4.3

    Bankrate Score

    The Federal Savings Bank specializes in mortgages for homebuyers, but also offers deposit products and personal loans. The veteran-owned bank offers savers a number of options to earn interest on everyday bank accounts like checking and savings.

    What we like

    • You can choose a fee-free checking or an interest-bearing account with solid perks for both.

    • There’s access to 43,000 surcharge-free ATMs nationally through the Allpoint Network.

    • Yields on deposit accounts are attractive, and longer-term CDs offer top-tier rates.

    What we don't

    • If you need to visit a branch to do your banking, TFSB only has two locations to choose from.

    • The money market account isn’t favorable for savers with smaller balances (under $1,000), as they are charged a $10 monthly fee and saddled with lower interest rates.

    CD rates

    5.0

    Bankrate Score

    OTHER CD OFFERS YOU MAY LIKE
    Goldman Sachs Bank USA

    Member FDIC

    CD

    0.65 % APY

    9mo

    Term

    $ 500

    Min. deposit

    The Federal Savings Bank offers certificates of deposit with eight terms and varying APYs that are better than what some other banks offer. If you have new money, it also offers promotional rates for several CDs.

    What we like

    • Longer-term CDs offer top-tier rates.

    • You only need $500 to open a CD.

    • Mobile and online banking access is available.

    What we don't

    • Advertised rates are only available to Illinois residents at this time.

    • You can get a higher yield with one of their jumbo CDs, but it’s a fairly insignificant boost.

    Savings accounts

    3.9

    Bankrate Score

    OTHER SAVINGS OFFERS YOU MAY LIKE
    Goldman Sachs Bank USA

    Member FDIC

    Savings account

    0.50 % APY

    $ 0

    Min. balance for APY

    You can open a Federal Savings Bank savings account online or at its two traditional retail branches in Chicago and Lake Forest, Illinois. Its mobile banking app allows you to manage the account and make deposits using check image captures.

    You only need to deposit $100 to earn the top APY; however, you can find higher yields elsewhere.

    What we like

    • In order to open a Statement Savings account, you’ll need just $25 or more to get started.

    • There’s no monthly service fee to worry about.

    What we don't

    • You can get a rate that’s better than most big banks, but it tends to be behind most top online banks.

    • Interest is compounded and credited on a quarterly basis.

    Checking accounts

    4.8

    Bankrate Score

    OTHER CHECKING OFFERS YOU MAY LIKE
    Axos Bank

    Member FDIC

    Checking account

    1.25 % APY

    $ 50

    To open

    $ 0

    To avoid fees

    At Federal Savings Bank, customers with the Value Checking account won’t have to pay a monthly service charge and can open an account with just $25. Checking customers have free access to more than 43,000 ATMs across the country, which is a nice perk.

    Interest Checking accounts will earn interest, but you’ll want to keep a daily balance of $1,000 or more to avoid a monthly service charge of $9.99. You can also have the fee waived each month with an ACH deposit.

    What we like

    • You can choose an account that works best for you, whether that’s a fee-friendly Value account, or the Interest Checking account that requires a higher balance.

    • There’s no minimum balance requirement for the Value account.

    • Both checking accounts offer access to Popmoney and online Bill Pay.

    • Customers have surcharge-free access to tens of thousands of ATMs within the Allpoint Network.

    What we don't

    • The lack of a branch presence can be a major drawback for some customers.

    • Interest Checking account holders may be hit with a monthly fee if the minimum average daily balance of their account drops below $1,000.

    • There’s an $8 charge for a lost debit card, and you’ll have to pay $50 for an outgoing international wire transfer.

    Money market accounts

    3.0

    Bankrate Score

    A money market account pays you to save while allowing you some flexibility to withdraw or transfer funds. TFSB’s money market account pays more than many banks, but not as much as some online-only banks. There are five different balance tiers, but in order to earn the highest APY, you’ll need to have at least $100,000 in the account.

    What we like

    • Savers in the highest deposit tiers can get a competitive rate.

    • Online Bill Pay access is included.

    • You can write checks with this account.

    What we don't

    • There’s a monthly fee if your balance drops below $1,000.

    • If you go over the limit of six transactions per billing cycle, there’s a $15 fee per item in excess of the maximum allowed.

    Bank experience

    The Federal Savings Bank has only two retail banking locations, but offers a mobile app that rates well with users of Apple and Android devices and provides a big surcharge-free ATM network. Using the Popmoney and Zelle payment platforms, it also allows person-to-person payments.

    Deposit products may be managed online. Customers who are unable to visit a branch can also reach customer service over the phone for help with their banking needs.

    About The Federal Savings Bank

    The Federal Savings Bank is an FDIC-insured bank that is privately owned by veterans. Its emphasis is on mortgage lending, but the bank also offers deposit products that earn interest.

    The bank was established in 2000 and is headquartered in Chicago. Although TFSB only has two retail banking branches, it provides home lending services in all 50 states to help customers achieve the American Dream.

    Brian Beers Twitter Created with Sketch. @BRIAN_BEERS

    Brian Beers Twitter Created with Sketch. @BRIAN_BEERS

    Brian Beers is the senior banking editor at Bankrate. He oversees editorial coverage of banking, investing, the economy and all things money. Previously, he was the director of editorial production for CNBC Digital where he received an Emmy-nomination for the long-form digital feature "Boom, Bust and Blame: The Inside Story of America's Economic Crisis." Brian is driven to help people learn more about their money and investments knowing that it could end up positively impacting them in a real-life financial decision someday. His work has been published on CNBC, Investopedia, MagnifyMoney, NBC Sports, The Drive and Yahoo. He also spent a number of years as the lead digital producer of SportsBiz with Darren Rovell. Brian holds a B.S. in finance from Syracuse University and lives in New York with his family.