Best 3-Year CD Rates

These are the highest-paying 3-year CDs that anyone in the country can open

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If you're looking for a way to generate some interest on your money and don't necessarily need access to it for a few years, a three-year certificate of deposit (CD) might be worth a look. To help you find the highest rate possible, we continually analyze rate data from the 200+ banks and credit unions that accept customers nationwide and rank the best-paying three-year CDs on the market today.

Since the top rates are sometimes a product of special promotional certificates with odd terms, CDs with durations from 30 to 41 months are eligible for our 3-year rankings, with minimum deposit requirements of up to $25,000.

In cases where more than one institution pays the same top rate, we've prioritized CDs by the shortest term, then the CD requiring a smaller minimum deposit, and if still a tie, by which CD has a milder penalty for early withdrawal.

Best 3-Year CD Rates:

  • Hughes Federal Credit Union - 1.11% APY
  • Heartland Credit Union - 1.05% APY
  • Lafayette Federal Credit Union - 1.01% APY
  • EFCU Financial - 1.00% APY
  • Quorum Federal Credit Union - 1.00% APY
  • MAC Federal Credit Union - 1.00% APY
  • Credit Human - 1.00% APY
  • Quontic Bank - 1.00% APY
  • American Heritage Credit Union - 1.00% APY
  • PenFed Credit Union - 1.00% APY
  • Interior Federal Credit Union - 0.96% APY
  • Evansville Teachers Federal Credit Union - 0.95% APY
  • Hiway Federal Credit Union - 0.95% APY
  • Abound Credit Union - 0.90% APY
  • First National Bank of America - 0.90% APY

Our full ranking of the top-paying nationally available 3-year CDs is listed below, including details about minimum deposits and early withdrawal penalties. For credit union CDs, information is also provided on how to easily join the credit union.

Hughes Federal Credit Union: 1.11% APY

  • Term (months): 36
  • Minimum deposit: $1,000
  • Early withdrawal penalty: Six months of interest ($50 minimum)
  • Membership: Anyone can join Hughes by donating $10 to one of four local library nonprofits and keeping at least $50 in a savings account.

Heartland Credit Union - 1.05% APY

  • Term (months): 36
  • Minimum deposit: $25,000
  • Early withdrawal penalty: Six months of interest
  • About: Anyone can join Heartland by keeping $25 in a member savings account.

Lafayette Federal Credit Union: 1.01% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: 12 months of interest
  • Membership: Anyone can join Lafayette Federal with a $10 membership in the Home Ownership Financial Literacy Council and $50 or more held in a savings account.

EFCU Financial - 1.00% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join EFCU by making a donation of any amount to the EFCU Financial Foundation and keeping at least $5 in a member savings account.

Quorum Federal Credit Union: 1.00% APY

  • Term (months): 30
  • Minimum deposit: $1,000
  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join Quorum by signing up for a free membership in the nonprofit American Consumer Council and keeping at least $5 in a savings account.

MAC Federal Credit Union: 1.00% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: Three months of interest
  • Membership: Anyone can join MAC by donating $40 to the Association of the U.S. Army and keeping $10 or more in a savings account.

Credit Human - 1.00% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: Greater of $50 or 12 months of interest
  • Membership: Anyone can join Credit Human by agreeing to a complimentary membership in the nonprofit American Consumer Council and keeping at least $5 in a member savings account.

Quontic Bank: 1.00% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: 24 months of interest
  • About: Quontic is an online-only bank established in 2005 and based in New York.

American Heritage Credit Union: 0.90% APY

  • Term (months): 36
  • Minimum deposit: $1,000
  • Early withdrawal penalty: 12 months of interest
  • Membership: Anyone can join American Heritage by signing up for a free membership to the Kids-N-Hope Foundation and keeping at least $15 in a savings account.

PenFed Credit Union: 1.00% APY

  • Term (months): 36
  • Minimum deposit: $1,000
  • Early withdrawal penalty: If closed within first year, 12 months of interest. If after the first year, 30% of the full term's interest.
  • Membership: Anyone can join PenFed by keeping $5 in a member savings account.

Interior Federal Credit Union: 0.96% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join Interior Federal by signing up for a free membership to the New Mexico Wildlife Federation and keeping $25 or more in a savings account.

Evansville Teachers Federal Credit Union: 0.95% APY

  • Term (months): 36
  • Minimum deposit: $1,000
  • Early withdrawal penalty: Six months of interest ($100 minimum)
  • Membership: Anyone can join ETFCU by donating $5 to the Mater Dei Friends & Alumni Association and holding at least $5 in a savings account.

Hiway Federal Credit Union: 0.95% APY

  • Term (months): 36–47
  • Minimum deposit: $25,000
  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join Hiway Federal by signing up for a $10 membership in the Minnesota Resource & Park Foundation and keeping $5 or more in a savings account.

Abound Credit Union: 0.90% APY

  • Term (months): 36
  • Minimum deposit: $500
  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join Abound with a $10 one-time fee and $5 or more kept in a savings account.

First National Bank of America: 0.90% APY

  • Term (months): 36
  • Minimum deposit: $1,000
  • Early withdrawal penalty: 12 months of interest
  • About: First National Bank of America is a Michigan-based community bank established in 1955. In addition to three branches in the state, FNBA offers online banking products to customers nationwide.

What Is a 3-year CD?

Certificates of deposit, or CDs, are savings products that pay the customer interest in exchange for agreeing to leave their deposit with the bank or credit union for a fixed period of time.

Most depository institutions offer a variety of CDs with different maturity dates; typically, the shortest ones will last three months while the longest ones range up to ten years, though five years is the longest term at most institutions. In theory, the longer the duration of the deposit, the higher the rate the institution is willing to offer.

CDs are considered safe, conservative investments because their rate of return is pre-determined and guaranteed to remain locked for the full term. In addition, virtually all CDs are offered by FDIC-insured banks, or by credit unions insured through the NCUA. As a result, deposits of up to $250,000 are protected, even if the financial institution faces liquidity problems.

Most CDs don't allow you to add funds after the initial deposit, making it a less favorable savings vehicle for those who wish to make periodic contributions. But CD accounts are well-suited for parking cash you won't need for a while and that you want invested reliably and essentially risk-free.

Usually, CDs are set to automatically renew at maturity. But you'll be notified of the maturity date in advance and given the opportunity to tell the bank you'd like to do something different with the money, such as withdraw it or transfer it to another institution. Fortunately, if you miss the maturity date by a few days, most banks and credit unions afford a grace period of a few days during which you can still withdraw your funds without penalty.

It's important to note that CD rates can vary significantly from one bank or credit union to another. Indeed, the top certificate rates nationwide are typically three and five times the industry average for a CD of the same duration. So it's critical you shop around.

How Does a 3-Year CD Work?

Each CD has a pre-established rate of interest that the bank or credit union pays on the deposit amount. The rate is usually published as an annual percentage yield, or APY, which reflects the total earnings on the account over a year's time, given the actual interest rate and the frequency with which that interest is compounded.

Many CDs use daily compounding, in which the annual interest rate is divided by 365 and applied to the balance each day. The following day, the daily interest rate is applied to this new balance, increasing the yield in the account. The amount of interest that has accrued will typically be credited monthly or quarterly.

To provide a disincentive to CD holders from taking their money out of the account before maturity, all banks and credit unions have an early withdrawal penalty policy. An early withdrawal will cause you to forfeit some of your interest earnings—3 to 12 months' worth of interest is common—but the penalties vary widely by institution, with some onerous enough to eat into principal.

Some banks and credit unions offer penalty-free CDs, although they typically offer a lower rate and may be "all or nothing" propositions. If that's the case, you would need to pull out your entire balance and close the account if you want to withdraw early. Because of their lower rates, no penalty-free options make the cut in our ranking of the top-paying nationally available 3-years CDs.

How Are CD Rates Determined?

The rate paid on CDs is determined by each bank and credit union and involves their particular need for deposits and the time horizon of their deposit strategy. However, the actions of the Federal Reserve loom large in the equation. The federal funds rate, which is determined by the central bank's Federal Open Market Committee, influences how much banks have to pay in order to borrow from each other. That, in turn, influences how much individual depository institutions are willing to pay consumers for their deposit funds.

When the Fed's rate is low, banks will offer lower yields on interest-bearing accounts. When interest rates go up, however, they tend to pay higher rates in order to attract customers.

What Are Alternatives to a CD?

CDs offer a trade-off compared to other conservative investments, such as savings accounts and money market accounts. While they offer higher yields compared to these other instruments, they also provide less flexibility. Instead of being able to deposit and withdraw money at your discretion, a CD will require you to commit a fixed amount to remain untouched for a certain amount of time.

In general, CDs tend to be a good option for individuals who have a lump sum of cash that they won't need to tap for several months or a few years. In such cases, they're much safer than stocks, or even bonds, which have the ability to lose value in poor economic conditions.

One increasingly popular alternative to CDs are high-yield savings accounts from online banks like Ally and Marcus. These accounts offer yields that are slightly lower than the best-paying CDs, but give account holders greater flexibility in return. For those seeking better returns than those afforded by a traditional savings account, they represent a middle ground of sorts.

How Can I Join a Credit Union on the List?

Unlike banks, credit unions are created to serve the needs of a specific community. In many cases, that means restricting membership to the residents of a certain area or to the employees of a particular company or group of companies.

However, some credit unions make it fairly easy for non-local individuals to gain eligibility. For example, the institution may allow you to attain membership by making a donation to its foundation or a nonprofit in its community, or by joining a financial literacy or consumer protection organization like the American Consumer Council.

If you aren't looking to lock your money up for a period of time and want easier access to it, you could look at opening a high-yield savings account as an alternative. Below are some savings account options from our partners, which can be competitive with the rates you can earn on CDs. It should be noted that unlike a CD, where your rate is locked in, with a savings account the bank or credit union can change your rate at any time.