Online banks where to find high rates.

There's an interest-rate war going on, and with a little detecting, you can garner the spoils. Internet-based banks, battling for a share of the market, are offering enticing interest rates--5 percent and higher--on certificates of deposit, money-market accounts, and even plain old savings. These rates are typically much higher than what you could get at a walk-in branch. At the same time Citibank was paying an annual percentage yield, or APY, of 5 percent for online savings, its regular branches paid 0.7 percent a year for passbook savings.

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Think of these accounts as interest generators and not much else. Most don't offer online bill payment. While many offer ATM cards, those cards usually won't double as debit cards. And check-writing is limited. Typically, you have to link your new account to an existing or new checking account. But the two accounts can provide a powerful combination of high rates and convenience.

WHERE TO PUT YOUR MONEY

Before you shop for an online account, take a moment to think about your plans for your money. A CD is a good place to stash cash earmarked for something specific--perhaps a home-remodeling project or next year's tuition--that you'll need around a certain time. If you with-draw the money early, you'll pay a penalty that is fixed by the bank.

Because CDs often pay higher rates than savings accounts, they obligate you to tie up your money for a fixed term, say, six months, and usually require a deposit of at least $500. According to Bankrate.com, a Web site that provides daily updates on rates from 4,800 financial institutions, the average six-month CD was paying 4.68 percent a year and one-year CDs nearly 5 percent in early October. Several Internet banks were paying 5.25 to 5.6 percent yields on one-year CDs with a minimum deposit of $500 to $1,000.

Bank money-market and savings accounts offer more flexibility but lower, floating yields. In early October they were paying 1.35 to 1.5 percent less per year than one-year CDs on average. A handful require no minimum deposit to avoid fees. They're good parking spots for emergency funds. You can also have your paychecks or Social Security checks deposited directly into money-market accounts. Some offer limited check writing, typically three checks a month. (Don't confuse bank money-market accounts with money-market mutual funds. The latter are sold by brokerages and fund companies, and are not FDIC insured.) Online savings accounts are similar to money-market accounts. In early October, the highest online annual savings yields were around 5.30 percent.