Just saw some information that ING Direct increased their rate to 4.15%. However compared to Emigrant Direct, HSBC Direct, The new Citi, GMAc bank……. ING Direct is still way behind their rates.

Sorry, I forget to share the further information about 2 scams that commonly used to cheat our ID. This information also comes from Newsfactor.com’s article called “Online Banking: How Safe Is Your Money?” .

“Two scams commonly used today are phishing and pharming. In a phishing attack, a victim is tricked into divulging a password, user name, or other confidential data by an e-mail that purports to originate from a bank or credit card company. The message typically steers people to fake Web sites under the pretense of having them update security information. Once the sensitive data is obtained, the victim’s money is there for the taking.

Phishing e-mails might also ask customers to reconfirm their ATM card number, expiration date, and personal identification number (PIN). These details are then used to manufacture a bank card, which the fraudster then uses to drain the victim’s account.

Pharming works much in the same way as phishing, except that e-mail is now out of the picture. In a pharming attack, your Web browser is hijacked so that you are diverted to a false site when you attempt to visit your bank. Unaware of anything out of the ordinary, you divulge your password and user name to criminals.”

Source : Newsfactor.com

Newsfactor.com has an article called “Online Banking: How Safe Is Your Money?” and talk about the security issue of online banking.

According to the article, Bank of America will released a new authentication system called SiteKey, some kind of software based security tools. E*Trade, on the other hand chose a hardware-based route called SecurID.

“SiteKey allows our customers to know that they are accessing our Web site and not a fraudulent site, and it enables us to know that we are dealing with genuine customers,” said Betty Riess, a spokesperson for Bank of America.”

What I know is, Sitekey is a kind of internet based software that will show customer an image and a phase that only customer know. So if a certain site is or not showing the correct image, then possible the site is being hijacked and you are brought to a fraud site.

“SiteKey uses cookies — packets of information commonly used as tracking devices — to check whether or not customers are accessing the bank’s Web site from their usual computers. If, for example, they are using a computer at an Internet café, then they are given some challenge-and-response questions that only they will be able to answer.”

SecurID for E*Trade is a hardware-based security tools. It will calculate a one time “passnumber” to enter when you are logging to E*trade. This tokens is free if you have $50000 asset with E*trade and $25 will be charged to others. Hmm, extra expenses for security with E*Trade….

“E*Trade chose a hardware-based route to stronger authentication. Since April 2005, it has been offering its customers devices known as SecurID tokens, which are made by RSA Security in Bedford, Massachusetts. For customers who are frequent traders on the site or who hold over $50,000 in assets with E*Trade, the SecurID tokens are free, and a one-time $25 charge for everyone else. “

Source : NewsFactor

Yahoo! Finance is a place that we can learn a lot about personal finance. Today I just read an article called “Interest Rate is Everything!” while I’m doing some research in Yahoo! Finance. So in this post I will share this article with you.

Overall, this article is about annual interest rate (APR) and annual percentage yield (APY) .
If you want to include saving account in your financial planning, then you must clear with the difference, so you can make a better decision. In conclusion, the main difference between APR and APY is APY is changing base on the frequency of interest paying and because of this, APY is having the power of compound interest. However, APR doesn’t have this feature.

Below is a Paragraph that will show you the difference between APR and APY:

Let’s say interest pays annually. A $10,000 investment will earn $500 in interest. ($10,000 x 5 percent x 1 year.) When an investment pays interest annually, its rate and its yield are the same.

The more frequently interest is paid, the higher the yield. That’s because the interest payment is credited to the CD and it starts earning interest along with the invested principal.

If the 5 percent CD paid interest semiannually, the six-month interest payment would be $250, ($10,000 x 5 percent x .5 years.) The $250 payment starts earning interest and earns $6.25 in interest during the next six months, ($250 x 5 percent x .5 years.) That’s what compounding interest is all about.

The first CD earned $500 in interest after a year and the second CD earned $506.25 in interest. The rate and yield on the first CD is 5 percent. The rate on the second CD is 5 percent, but its yield is 5.06 percent. If interest was paid daily, the rate would be 5 percent but the yield would be 5.13 percent.

Source : Yahoo! Finance