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Best CD Rates in August 2022

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Certificates of deposit (CDs) are safe, conservative savings vehicles that lock up your money for a guaranteed return after a set term duration. We’ve compiled the highest CD rates today for many terms. Bread Savings has the best CD rates for three different terms (2-year, 3-year and 4-year CDs).

Why trust us: MagnifyMoney is a free, independent outlet covering the financial services industry. We reviewed dozens of banks and credit unions using information from DepositAccounts to produce a list of the best CD rates available nationwide. Read our methodology to learn how we selected the best CD rates.

Best CD rates in August 2022

TermFinancial institutionAPYMinimum deposit to earn APY
Under a year*One American Bank3.01%$5,000
1-yearCFG Bank3.05%$500
2-yearBread Savings 3.50%$1,500
3-yearBread Savings 3.55%$1,500
4-yearBread Savings 3.60%$1,500
5-yearEFCU Financial4.00%$500

*9 months

These are the best available CD rates for these terms as of August 5, 2022.

Best CD under a year: One American Bank

SEE DETAILS

on One American Bank’s secure website

Member FDIC

  • Term: 9 months
  • APY: 3.01%
  • Minimum deposit required to earn APY: $5,000

One American Bank is headquartered in South Dakota and offers a wide range of checking, savings and lending options. All of One American’s CD rates stand out, well above the national averages for every term, according to the Federal Deposit Insurance Corporation (FDIC).

Currently, the bank is offering a CD rate special of 3.01% APY for a nine-month term. The minimum deposit for any of the current CD specials is $5,000. For regular CDs, you’ll still see above-average APY, though not as high as the specials, and the minimum deposit to open is $500.

Best 1-year CD: CFG Bank

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on CFG Bank’s secure website

FDIC Insured

  • Term: 12 months
  • APY: 3.05%
  • Minimum deposit required to earn APY: $500

CFG Bank is headquartered in Baltimore, Md., and was ranked No. 11 in the S&P Global Market Intelligence list of best-performing banks with less than $3 billion in assets. CFG offers a range of personal and commercial banking products, cash management services and financial resources.

CFG’s CDs can be opened online or in a branch. They range from 12 months at 3.05% APY to 60 months at 3.65% APY, and the 12-month CD requires a minimum deposit of $500 to open and earn interest.

Best 2-year CD: Bread Savings

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on Bread Financial’s secure website

Member FDIC

  • Term: 24 months
  • APY: 3.50%
  • Minimum deposit required to earn APY: $1,500

Bread Savings is a part of Bread Financial, an online-only financial services company that offers various saving, lending and payment solutions. Currently, Bread Savings offers a range of CD terms from one year to five years at competitive rates, with interest accrued and compounded daily and posted monthly.

The bank’s 1-year CD comes with 3.00% APY and a $1,500 minimum opening deposit that cannot exceed $1 million per account. You will be charged a fee for outgoing wire transfers and official check requests, and an early withdrawal penalty applies but varies based on the term length.

While the bank has no physical branches, they do offer ways to get in touch virtually and over the phone.

Best 3-year CD: Bread Savings

SEE DETAILS

on Bread Financial’s secure website

Member FDIC

  • Term: 36 months
  • APY: 3.55%
  • Minimum deposit required to earn APY: $1,500

Read more about Bread Savings above.

Best 4-year CD: Bread Savings

SEE DETAILS

on Bread Financial’s secure website

Member FDIC

  • Term: 48 months
  • APY: 3.60%
  • Minimum deposit required to earn APY: $1,500

Read more about Bread Savings above.

Best 5-year CD: EFCU Financial

SEE DETAILS

on EFCU Financial’s secure website

NCUA Insured

  • Term: 60 months
  • APY: 4.00%
  • Minimum deposit required to earn APY: $500

EFCU Financial is Louisiana’s 5th largest credit union, headquartered in Baton Rouge. Members gain access to a variety of rewards checking and share/savings accounts, with CDs that range from 6 months to 5 years. Right now, EFCU is offering the best traditional CD rate: a 5-year CD at 4.00% APY. Anyone is eligible to join the credit union if they have immediate family who are members or by joining the EFCU Financial Foundation or the Louisiana Wildlife Foundation. Membership is also open to those who are associated with one of nine Louisiana Parishes.

Types of CDs

Some financial institutions offer CDs with different conditions than the standard single deposit with a fixed term and early withdrawal penalties.

  • Traditional CDs: This is the standard CD and tends to offer the best interest rates on the deposits outside of jumbo CDs. In short, you’ll agree to the deposit amount, interest rate and term duration when opening the CD and won’t be able to access those funds without penalty until the maturation date.
  • Jumbo CDs: Some banks and credit unions offer marginally better interest rates on “jumbo” CDs, which generally have a minimum deposit requirement of $100,000 (or another amount significantly over the minimum for a traditional CD).
  • No-penalty CDs: Financial institutions may choose to offer lower rates on CDs in exchange for giving the account holder the ability to withdraw some or all of their funds before the CD reaches maturity without incurring the typical penalty — often calculated as a percentage of the interest borne on the account. We’ve rounded up the best no-penalty CD rates here.
  • Bump-up CDs: One of the key advantages of a CD is that you can lock in your interest rate for the duration of the term, but some banks and credit unions may allow you to “bump up” your interest rate once in the term if the rates offered on the account improve.
  • IRA CDs: Individual Retirement Accounts are a form of tax-advantaged account designed to incentivize retirement savings, and there are a few options for how to structure those types of accounts, including as a CD. There are some yearly contribution limits for IRAs. We’ve rounded up the best IRA CD rates here.

Should I open a CD account?

A certificate of deposit has some drawbacks, namely that you can’t access your funds without penalty before the maturation date. Unlike a savings account, which allows for at least a few withdrawals per month, a CD is a deposit account that sacrifices some liquidity (in other words, access to your money) for marginally better interest rates.

However, those rates are low right now. According to the FDIC, the average rate offered on a 1-year CD right now is just 0.31% — which would translate to an annual yield of $31 on a deposit of $10,000. The accounts featured on our MagnifyMoney list have much better rates than average, and the highest 1-year CD currently offered is CFG Bank’s 3.05% APY CD. A $10,000 deposit would yield $305.

In an environment of low interest rates and high inflation, a CD may actually depreciate in value, especially over the long run. It’s difficult to predict future interest rate trends, but in the event that the Federal Reserve raises the federal funds rate, the interest rates on deposit accounts figure to rise as well. In that case, a key advantage of CDs — that your interest rate is guaranteed for the duration of your term — may actually become a disadvantage if you’re stuck with a lower rate.

One long-term alternative to a CD is an I savings bond, which is issued by the U.S. Treasury. The current rate on I bonds is 9.62% APY, and you have to wait at least a year to redeem the bond — if you redeem it within five years, you lose the last three months of interest. Otherwise, market investments (which carry some risk), other bonds or even precious metals like gold may be a better way to store your funds when inflation exceeds the rate paid on CDs.

Summary of the best CD rates in August 2022

  • 9-month: One American Bank (3.01% APY)
  • 1-year: CFG Bank (3.05% APY)
  • 2-year: Bread Savings (3.50% APY)
  • 3-year: Bread Savings (3.55% APY)
  • 4-year: Bread Savings (3.60% APY)
  • 5-year: EFCU Financial (4.00% APY)

Frequently asked questions

A certificate of deposit (CD) is a type of bank account that allows you to make a one-time deposit with a guaranteed interest rate over a predetermined time duration. You usually cannot withdraw funds before the maturation date without incurring a penalty.

The best traditional CD rate offered among financial institutions reviewed by MagnifyMoney is EFCU Financial’s 4.00% APY for a 5-year term. There is a minimum of $500 to open a CD with EFCU Financial.

The Federal Reserve sets the federal funds rate, which affects the interest rates for loans between banks. The rates for interest-bearing accounts, especially CDs, tend to rise and fall with the federal funds rate and other economic conditions.

Among financial institutions surveyed by MagnifyMoney, Bread Savings has the best 2-year, 3-year and 4-year CD rates.

Methodology for determining the best CD rates

MagnifyMoney reviewed data from DepositAccounts, covering hundreds of banks and credit unions in order to source a list of the best nationally available financial institutions for CDs and CD rates. Every institution we feature is covered with Federal Deposit Insurance Corp. (FDIC) or National Credit Union Administration (NCUA) insurance. Our picks for best CD rates have minimum deposits of $10,000 or lower.