Best CD Rates

Our guide to the highest CD rates available to anyone in the U.S.

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When you have cash you want to save for a bit, but want to earn more than you would with a standard savings account, certificates of deposit can be a good option. To help you earn the most you can, here are the top certificate of deposit rates available from our partners, followed by our rankings on the best-paying CDs that are available to U.S. customers everywhere.

Drawn from our continuous research on the approximately 200 banks and credit unions that offer CDs nationwide, these certificates typically pay three to six times as much as the national average—or even more. To be eligible for our rankings, each CD must have a minimum deposit requirement of $25,000 or less and be offered by an FDIC-insured bank or NCUA-insured credit union.

In cases where more than one institution offers 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.

Ranked by highest APY, then shortest term, then lowest minimum      
Best 3-Month CDs Rate Term Minimum
Umbrella Bank 4.25% APY 3 months $1,000
Popular Direct 4.10% APY 3 months $10,000
Farmers Insurance Federal Credit Union 4.00% APY 4 months $1,000
For more options, see our in-depth 3-month CD rankings
Best 6-Month CDs Rate Term Minimum
Abound Credit Union 5.00% APY 6 months $500
Greenwood Credit Union 4.75% APY 6 months $1,000
NASA Federal Credit Union 4.65% APY 9 months $10,000
For more options, see our in-depth 6-month CD rankings      
Best 1-Year CDs Rate Term Minimum
Capital One 5.00% APY 11 months Any amount
CFG Bank 4.85% APY 12 months $500
Ivy Bank 4.85% APY 12 months $1,000
For more options, see our in-depth 1-year CD rankings      
Best 18-Month CDs Rate Term Minimum
Langley Federal Credit Union 5.00% APY 15 months $500
UNIFY Financial Credit Union 5.00% APY 15 months $500
Kinecta Federal Credit Union 5.00% APY 15 months $1,000
For more options, see our in-depth 18-month CD rankings
Best 2-Year CDs Rate Term Minimum
Dover Federal Credit Union 4.80% APY 24 months $500
3Rivers Federal Credit Union 4.75% APY 21 months $10,000
Mountain America Credit Union 4.75% APY 24 months $500
For more options, see our in-depth 2-year CD rankings  
Best 3-Year CDs Rate Term Minimum
Genisys Credit Union 4.84% APY 30 months $500
3Rivers Federal Credit Union 4.75% APY 33 months $10,000
Crescent Bank 4.65% APY 30 months $1,000
For more options, see our in-depth 3-year CD rankings      
Best 4-Year CDs Rate Term Minimum
NASA Federal Credit Union 4.75% APY 49 months $10,000
Seattle Bank 4.65% APY 48 months $1,000
Lafayette Federal Credit Union 4.58% APY 48 months $500
For more options, see our in-depth 4-year CD rankings
Best 5-Year CDs Rate Term Minimum
Seattle Bank 4.70% APY 60 months $1,000
Lafayette Federal Credit Union 4.63% APY 60 months $500
Popular Direct 4.55% APY 60 months $10,000
For more options, see our in-depth 5-year CD rankings      
Best 6- to 8-Year CDs Rate Term Minimum
First National Bank of America 4.50% APY 7 years $1,000
Department of Commerce Federal Credit Union 4.42% APY 5-7 years $25,000
Discover Bank 4.30% APY 7 years $2,500
KS State Bank 4.22% APY 7 years $500
Michigan State University Federal Credit Union 4.00% APY 7 years $2,500
Best 10-Year CDs Rate Term Minimum
Discover Bank 4.30% APY 10 years $2,500
Apple Federal Credit Union 3.90% APY 10 years $500
Credit Human 3.15% APY 10 years $500
For more options, see our in-depth 10-year CD rankings      

Details on the early withdrawal penalty for the top CD in each term are provided below, along with information on how to join the credit union, where applicable.

Top 3-month rate: Umbrella Bank - 4.25% APY

  • Early withdrawal penalty: Complex formula, with a minimum penalty of 1% of the amount withdrawn
  • About: An internet-only arm of Beal Bank, which operates 6 physical branches in Texas, California, Ohio, and Pennsylvania, Umbrella Bank serves customers nationwide.

Top 6-month rate: Abound Credit Union - 5.00% APY

  • Early withdrawal penalty: Three months of interest
  • Membership: Anyone can join Abound with a $10 one-time fee and $5 or more kept in a savings account.

Top 1-year rate: Capital One - 5.00% APY (11 months)

  • Early withdrawal penalty: Three months of interest
  • About: Capital One is the 7th largest U.S. bank by assets, offering various banking products online to customers nationwide.

Top 18-month rate: Langley Federal Credit Union - 5.00% APY (15 months)

  • Early withdrawal penalty: Six months of interest
  • About: Anyone can join Langley Federal Credit Union by simply keeping $5 in a member savings account.

Top 2-year rate: Dover Federal Credit Union - 4.80% APY

  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join Dover Federal by making a $15 donation to the Friends of Bombay Hook and keeping at least $5 in a savings account.

Top 3-year rate: Genisys Credit Union - 4.84% APY (30 months)

  • Early withdrawal penalty: Six months of interest
  • Membership: Anyone can join Genisys by making a $5 donation to the Arthritis Foundation or the Paint Creek Center for the Arts and keeping at least $5 in a member savings account.

Top 4-year rate: NASA Federal Credit Union - 4.75% APY (49 months)

  • Early withdrawal penalty: 12 months of interest
  • Membership: Anyone can join NASA FCU by signing up for a free membership in the National Space Society and holding $5 or more in a savings account.

Top 5-year rate: Seattle Bank - 4.70% APY

  • Early withdrawal penalty: Six months of interest
  • About: Established in 1999, Seattle Bank serves online customers across the country as well as operates a branch in downtown Seattle.

Top 6- to 9-year rate: First National Bank of America - 4.50% APY (7 years)

  • Early withdrawal penalty: 18 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.

Top 10-year rate: Discover Bank — 4.30% APY

  • Early withdrawal penalty: 24 months of interest
  • About: In addition to its well-known credit card, Discover offers online-only banking products to consumers nationwide.

Alternatives to CDs

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 that 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.

Pros and Cons of CDs

  • Offers a higher rate than you can earn with a savings or money market account

  • Pays a guaranteed, predictable rate of return, avoiding the volatility and losses that are possible with stocks and bonds

  • Is federally insured if opened with an FDIC bank or NCUA credit union

  • Can help fend off spending temptations since withdrawing the funds early triggers a penalty

  • Cannot be liquidated before maturity without incurring an early withdrawal penalty

  • Typically earns less than stocks and bonds can over time

  • Earns a fixed rate of return regardless of whether interest rates rise during the term

How Much Do CDs Pay?

While the national average is a good indicator of the direction of rates—and how much they've changed over a period of time—they are not what you should consider when shopping for CDs. Instead, look for the top nationally available rates, which stand far above industry averages.

Take one-year CDs, for instance. The current national average is just 0.46% annual percentage yield (APY). Today's top-paying institution, however, will pay you 3.21% APY on that same one-year commitment—that's almost seven times as much. Similarly, for three-year CDs, you can currently earn 3.55% APY instead of the industry average of 0.54% APY.

If you have cash, you can park for a period of time, but want to earn more than the best savings and money market accounts will net you, our research on the best nationally available rates in every major CD term can lead you to maximum returns.

Keep in mind that CD yields are still considered taxable as interest income on both the state and federal levels, which will impact the total return you can realize.

How Does a CD Work?

Opening a CD is very similar to opening any standard bank deposit account. The difference is what you're agreeing to when you sign on the dotted line (even if that signature is now digital). After you've shopped around and identified which CD(s) you'll open, completing the process will lock you into four things:

  1. The interest rate: Locked rates are positive in that they provide a clear and predictable return on your deposit over a specific time period. The bank cannot later change the rate and therefore reduce your earnings. On the flip side, a fixed return may hurt you if rates later rise substantially and you've lost your opportunity to take advantage of higher-paying CDs.
  2. The term: This is the length of time you agree to leave your funds deposited to avoid any penalty (e.g., 6-month CD, 1-year CD, 18-month CD, etc.) The term ends on the "maturity date," when your CD has fully matured and you can withdraw your funds penalty-free.
  3. The principal: With the exception of some specialty CDs that allow add-on deposits, this is the amount you agree to deposit into the CD, at the time of opening.
  4. The institution: The bank or credit union where you open your CD will determine aspects of the agreement, such as early withdrawal penalties (EWPs) and whether your CD will be automatically reinvested if you don’t provide other instructions at the time of maturity.

Once your CD is established and funded, the bank or credit union will administer it like most other deposit accounts, with either monthly or quarterly statement periods, paper or electronic statements, and usually monthly or quarterly interest payments deposited to your CD balance, where the interest will compound.

What Is a CD Ladder and Why Should I Build One?

Smart CD investors have a specific tactic for hedging against rate changes over time and maximizing their return. It's called a CD ladder and it enables you to access the higher rates offered by 5-year CD terms, but with the twist that a portion of your money becomes available every year, rather than every five years. Here's how to do it.

At the outset, you take the amount of money you want to invest in CDs and divide it by five. You then put one-fifth of the funds into a top-earning 1-year CD, another fifth into a top 2-year CD, another into a 3-year CD, and so forth through a 5-year CD. Let’s say you have $25,000 available. That would give you five CDs of varying length, each with a value of $5,000.

Then, when the first CD matures in a year, you take the resulting funds and open a top-rate 5-year CD. A year later, your initial 2-year CD will mature, and you'll invest those funds into another 5-year CD. You continue doing this every year with whichever CD is maturing, until you end up with a portfolio of five CDs all earning 5-year APYs, but with one of them maturing every 12 months, keeping your money a bit more accessible than if all of it were locked up for a full five years.

What Is Considered a Good Rate for a CD?

What makes CDs attractive as an investment vehicle is not their rate of return but their risk-free nature. When you open a CD, you know upfront exactly what interest rate you will earn and for how long. Except for some specialty CDs, the rate on your certificate is guaranteed and locked for the full duration of the certificate, meaning your return is predictable and safe.

Adding to their risk-free nature is the fact that CDs, like other bank and credit union deposit products, are federally insured against bank failures. Depending on the financial institution offering them, CDs are insured by either the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

CD minimums can run as low as $250 or $500, and you'll find plenty of options with minimums up to $1,000. As for durations, the majority of CDs carry terms of six months to five years, though shorter and longer certificates exist at some banks. Larger deposits and longer terms typically earn higher interest rates, though promotional certificates often break that general rule. The interest rates available on the best-paying CDs are usually in line with the current inflation rate, so virtually any rate higher than that is a good deal. Often, online banks and credit unions offer the best CD rates.

Maximizing Your CD Rate of Return

The No. 1 strategy for earning as much as you can from a CD investment is to diligently shop around for the top rates. After that, the next most important strategy is to keep the funds invested for the CD's full term, so as to avoid incurring an early withdrawal penalty that will reduce your earnings.

But unexpected things happen in life, and you may find yourself having no choice but to cash in a CD early. Because of that possibility, you'll be well-served by paying attention to the early withdrawal penalties of different CDs you're considering before you make your final commitment.

It's also useful when comparing two CDs that are fairly similar, to check their compounding periods. The advantage of having interest calculated and compounded more frequently adds up over time, so look to avoid CDs that offer only annual compounding.

While CDs are traditionally a fixed-rate investment, variable-rate CDs do exist. If you think interest rates are likely to rise significantly, you can benefit from a certificate whose interest rate is adjusted during the term of the CD. These certificates are sometimes called "raise your rate" or "step up" CDs.

Meanwhile, indexed or structured CDs offer you the chance to earn a percentage of the return on a stock index or commodity index. This can result in a much higher return than a traditional CD's—but for a trade-off of much more risk.

Article Sources
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  1. Federal Deposit Insurance Corporation. "Weekly National Rates and Rate Caps -- Weekly Update."