Rate Tier Mastery
At what exact balance does a Member Preferred Money Market begin earning more APY than Standard Savings?
At any balance, since Standard Savings earns 0.15% APY and Money Market starts at 1.01% APY.
A member keeps $10,000 in Standard Savings for one year. Approximately how much do they earn in dividends?
About $15, based on a 0.15% APY.
What balance earns the highest APY in First5 Savings, and why is it limited?
Balances up to $500, earning 5.10% APY, to encourage early saving behavior.
At what balance does Money Market earning 1.26% APY outperform First5 funds above the $500 cap?
At any balance, since 1.26% > 0.25%.
A member wants “the highest rate” but plans frequent withdrawals. What clarification must be made?
Rate tiers depend on maintaining balances, not just opening the account.
A member has $24,999 in a Money Market. What APY are they earning, and why?
1.01% APY, because the $25,000 tier has not yet been met
That same $10,000 moved to Money Market earns approximately how much more annually?
About $101, earning roughly $86 more than Standard Savings.
What happens to funds over $500 in a First5 Savings account?
They earn 0.25% APY, significantly lower than the promotional tier.
A member has $500 in First5 and $2,000 in Standard Savings. What restructuring improves total dividends?
Move the $2,000 to Money Market while keeping $500 in First5.
Why might two members with the same Money Market balance earn different dividends over a year?
Balance fluctuations can drop one member into lower tiers.
How much additional balance is needed to move from the 1.76% APY tier to the 2.02% APY tier in Money Market?
$25,000 more, moving from $75,000 to $100,000.
A member has $50,000 in Money Market at 1.51% APY. About how much will they earn annually?
About $755.
Why is First5 Savings not an effective long-term growth vehicle despite its high APY?
The high rate only applies to a small balance cap.
Why is $25,000 a psychologically important threshold in Money Market conversations?
It marks the first significant APY jump to 1.26%.
Why is APY more important than rate when comparing accounts?
APY reflects compounding and true annual earnings.
A member deposits $500,000.01 into Money Market. What APY applies, and what detail on the rate sheet confirms this?
2.79% APY, because the top tier applies to $500,000.00+.
If a member increases their Money Market balance from $49,999 to $50,000, what two things change?
APY increases from 1.26% to 1.51%
Annual dividends increase due to the higher tier applying to the full balance
How should we advise parents once a First5 balance consistently exceeds $500?
Consider moving excess funds to Standard Savings or Money Market for better tiered growth.
A member is $1 short of a higher tier. What is the financial impact of that $1 decision?
The entire balance earns the lower APY, reducing total dividends.
What is the most common error when explaining Money Market tiers?
Assuming only the amount above the threshold earns the higher APY.
A member maintains a daily balance of $74,999 in their Money Market for an entire year, then adds $1 on the final day of the dividend period. What APY applies for the year, and why?
1.76% APY, because dividend tiers are determined by the daily balance, and the higher tier must be maintained—not just reached at period end.
A member keeps $49,999 in a Money Market account for 12 months. Calculate the approximate dollar difference in annual dividends if they had instead maintained $50,000 for the full year.
About $125 more annually, because $49,999 earns 1.26% APY (~$630) while $50,000 earns 1.51% APY (~$755).
A First5 account has $3,000 deposited and no withdrawals for one year. Explain why the effective yield is far lower than 5.10% and identify which balances earn which APYs.
Only the first $500 earns 5.10% APY, while the remaining $2,500 earns 0.25% APY, drastically lowering the blended return.
👉 True or False:
Splitting a large savings balance between Standard Savings and Money Market always improves total earnings.
✅ Answer: False
💡 Consolidating into Money Market typically earns more due to higher APY tiers.
A member says, “I only need $24,000 accessible, but I want the best rate possible.” What is the incorrect recommendation, what is the correct recommendation, and why?
Incorrect: Standard Savings, because it earns only 0.15% APY
Correct: Money Market, because balances under $25,000 still earn 1.01% APY with full liquidity