Zions Bank in Utah has an Internet Money Market account that is paying 3.56% APY and changes with the market. It is FDIC insured.

One nice thing about ING is that it's easy to get a CD online using money from your savings. (Don't think this is possible with ED???) It's as easy as transfering money. Their 1yr CDs are now paying a respectable 4.15% APY and there's no minimum. If you have a chunk of money that you'll likely not need in a year, you may be better off at ING with a combination of savings and 1yr CDs.

I have an ING Direct account and an Emigrant Direct account. I also have a third savings account that I think should also be mentioned... PAYPAL! The paypal money market fund is now offering 3.28% and is rapidly climbing. Plus... you can have an ATM card associated... it's practically like having a checking account with a very high yield.

Out of curiosity, at your age, take a tiny bit more risk by going the short term municipal / government debt route? Depending on the state, you could reduce your projected AGI and get better return by dealing with the 30 day notes. May be a little more work but potentially paying much better than the CD's and MM accounts with fairly minimal risk.

This from somebody with a first hand bad experience: stay away from EmigrantDirect.

First of all, the initial setup takes forever and involves numerous steps. Ensuring security is nice, but with today's technology this can be done much less painfully. Second, the online account is very poorly designed and awful to use. Third, any transaction takes forever (or much longer than INGDirect, where I also have accounts). Most importantly, the customer service is about as bad as I've ever seen with a bank.

In my opinion, at yield merely 0.2% higher than INGDirect, it's not worth the effort to switch. If you have not set up an online direct saving account, you'll be making a wise decision to stay away from an bad experience you may come to regret later on.

I have both ING Direct & EmigrantDirect(ED) and have found that EmigrantDirec has been faster in transferring my cash into and out of my checking account. Only once have I waited more than 2 business days from ED. Currently they are offering a min. of 4.0% APY guaranteed through 12-31-05 w/possibility of increasing the rate while ING is stuck at 3.30%

I totally agree...ED moves money over to your checking account in 1 business day. I have had NO PROBLEMS WHATSOEVER with EmigrantDirect!!

Even better now, quoting the announce:

"We are pleased to announce that effective today, Tuesday, September 20, your American Dream Savings Account from EmigrantDirect now yields 4.0% APY, the highest rate in the country with no fees and no minimums, FDIC insured. Responding immediately to the most recent news from the Federal Reserve, EmigrantDirect is pleased to be able to offer this unmatched rate to our loyal customers."