How to get a 3.25% APY on a money market account at Sovereign Bank

I recently opened a new bank account at Sovereign Bank, including a personal checking account, a personal money market account, and a business checking account. They were offering a $100 new account cash bonus (after 90 days), or even up to $300 if certain conditions were met, including maintaining a $15,000 balance in the accounts. At first I was hesitant, figuring that a bank money market account would earn far less than a typical money market mutual fund, but I was wrong. A quick check revealed that a $15,000 balance would earn 2.75% APY and a $25,000 balance would earn 3.00% APY. By the time I got the account set up and money transferred, I checked the online rates and saw that they had upped the rate for a $25,000 balance to 3.25% APY. I asked my banker about the rates and he said to let him know whenever I put more money in the account and he would "code it" so that I would be sure to get the current rate. I did that today and now I should be earning at 3.25% APY in my personal money market account.

The banker gave me a copy of the "Rate Zone 11 Promotions" sheet, which shows that I have "Product code D201" and that he assigned me "Rate index 614." He did say that this promotion lasts through Friday, meaning you have through Friday to sign up for it, but he did not know how long that rate would continue for. I will keep an eye on it, and then request to be re-coded if my rate falls below the current promotion.

Unfortunately, the Web site does not show the current rate for my account, but it does show the interest earned during the current month, updated on a daily basis, so I can get at least an indirect indication of a rate change.

A rate of 3.25% APY corresponds to a simple interest rate of 3.20%. This contrasts with the current Fidelity Money Market fund (SPRXX) 7-day yield of 3.16%.

-- Jack Krupansky