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Updated on Wednesday, October 14, 2020
Sometimes you need a shorter-term CD, but the rate of return on a 12-month CD just isn’t quite enough. Thankfully, many institutions offer 18-month CD or 19-month CD options. They typically have higher rates than a 12-month account, while remaining a viable choice for near-term savings goals when a 24-month CD would be too long a commitment.
The key is to find the right 18-month CD to maximize your savings. If you look around, you can find rates just around 1.00% APY, compared to the average 18-month CD rate of 0.51%. To make the search process easier for you, we’ve uncovered the best 18-month CDs using data from DepositAccounts.com to find the highest APY. We also took each account’s minimum deposit requirement into consideration.
The 10 best 18-month CD rates in October 2020
1. The Federal Savings Bank — 1.10% APY, $10,000 minimum deposit
The Federal Savings Bank promotional 18-month CD rate must be funded with money not already in an account at the bank. The account will renew at maturity for the same length, but at a slightly lower rate. A penalty may be charged for early withdrawal.
The Federal Savings Bank is veteran-owned and focused heavily on mortgages and homeownership, in addition to its wide range of deposit accounts.
2. Consumers Credit Union (IL) — 1.00% APY, $250 minimum deposit
This 20-month certificate from Consumers Credit Union offers a special chance at this more competitive rate. The certificate will automatically renew at maturity at a term of two years. Dividends are compounded daily and credited monthly. If you withdraw money from the CD before the 20 months is up, you’ll face a penalty of 120 days’ dividends.
Illinois-based Consumers Credit Union is available to join by doing two things: Paying a one-time $5 fee to its sponsor, the Consumers Cooperative Association, and depositing and keeping $5 in a Membership Share/Savings Account.
3. Western Vista Credit Union — 1.00% APY, $0.01 minimum deposit
For a minimum deposit of only $0.01, you can start earning at this competitive rate with Western Vista Credit Union’s 19-month special CD. By bumping up your term length by just one month, you earn a rate that is more than double their 18-month rate. Dividends are paid quarterly and at maturity.
Founded in 1940, Western Vista is a community credit union based in Wyoming, but it offers service nationwide through shared branches. Membership is open to those in its serviced areas and anyone who makes a charitable contribution to their foundation. If you live outside of the service area, you’ll need to sign up over the phone.
4. Pen Air Federal Credit Union — 0.90% APY, $500 minimum deposit
You’ll need at least $500 to open an 18-month Pen Air Certificate. Then you can start earning at its 0.90% APY. The early withdrawal penalty for this term will equal 180 days’ dividends.
Founded in 1936, Pen Air Federal Credit Union is based in Pensacola, Fla., and maintains locations in Northwest Florida and Southeast Alabama. Pen Air membership is open to you if you’re active duty or retired military, a civil service employee, an employee at a partnering Select Employer Group or an immediate family member of eligible members. You may also join by becoming a member of the Friends of the Navy-Marine Corps Relief Society, Inc., whose one-time $3 donation Pen Air will make for you.
5. CommunityWide Federal Credit Union — 0.95% APY, $1,000 minimum deposit
Open a CommunityWide Federal Credit Union term share certificate with at least $1,000 to start saving at its competitive rate. Note that CW does not automatically renew your certificate at maturity, leaving that choice up to you. CW calculates its early withdrawal penalty a little differently than other institutions. It will equal the amount of the withdrawal times the remaining term (in days) of the certificate at the rate of two times the certificate’s current APR (divided by 365). The penalty will be deducted from the amount withdrawn.
CommunityWide FCU was founded in 1967 as the West Washington Association Federal Credit Union, gaining its current name in 1985. You can join CW if you’re a member, employee or retiree of select organizations, a spouse of someone who died while a member or an immediate family member of qualified members.
6. Hiway Federal Credit Union — 0.95% APY, $25,000 minimum deposit
This rate applies to Hiway Federal Credit Union certificate accounts from 12 to 23 months. Dividends are calculated using the daily balance method. Withdrawing funds from this Hiway Federal Credit Union certificate will cost you 90 days’ dividends, which is somewhat generous when compared to other banks and credit unions.
Hiway FCU was founded in 1931 for employees of Minnesota’s Department of Transportation. Individuals can also qualify by being a part of select Minnesota communities, working at partner companies or agencies or through family members. Everyone else can become a member of Hiway FCU by contributing to one of two organizations: the Minnesota Recreation and Park Foundation or the Association of the United States Army.
7. Evansville Teachers Federal Credit Union — 0.90% APY, $1,000 minimum deposit
You’ll earn this rate on Evansville’s 18-month certificate until the certificate first matures. Like all of Evansville’s certificates, this 18-month account requires a modest minimum investment of $1,000.
Membership to ETFCU is open to employees of select employers and organizations and their family members. You can also join with a $5 donation to the Mater Dei High School Friends & Alumni Association.
8. Hyperion Bank — 0.85% APY, $500 minimum deposit
Hyperion Bank’s CDs can be opened with $500. These CDs automatically renew at maturity, or you can deposit the funds into your Hyperion checking account within the 10-day grace period at maturity. Withdrawing before your 18 months are up will cost you 270 days’ dividends.
Founded in 2006, Hyperion Bank is headquartered in Philadelphia. It has a branch there and in Atlanta. Customers can access Hyperion Bank online and on its mobile app. There’s also a phone number and email available for help opening an account.
9. Marcus by Goldman Sachs Bank USA — 0.65% APY, $500 minimum deposit
Under the brand Marcus by Goldman Sachs, Goldman Sachs Bank USA is a consistent rate leader for its online deposit accounts. Its 18-month CD here earns a solid 0.65% APY on deposits of $500 and above. If you fund your account within 10 days of opening, Marcus will guarantee you the highest rate it can offer on that account. The early withdrawal penalty equals 270 days’ simple interest on the principal at the rate in effect for the CD.
Goldman Sachs Bank USA was founded in 1869 and is headquartered in New York City. Marcus is accessible online and on its mobile app.
10. BankDirect — 0.60% APY, $10,000 minimum deposit
This CD from Bank Direct gets you a rate that makes the list, but it will cost you a minimum deposit of $10,000. Any interest you earn can be added back to the principal or transferred to your checking, savings or money market account with the bank. Avoid any early withdrawals, as you’ll lose 180 days’ interest as a penalty.
A division of Texas Capital Bank, BankDirect is an internet-only bank with no physical branches.
Is it worth getting an 18-month CD over a 1-year CD?
When we discuss CD rates, we tend to center the conversation on 1-year CDs. They’re helpful to look at when assessing changes in rates over time, typically compared to long-term CDs. They also the general starting point when creating a CD ladder. So where do the slightly longer 18-month CDs fit in?
18-month CDs are only six months longer than 1-year CDs. It might seem like too little of a difference, especially when you’re squirreling away cash. However, because of this extra time a bank gets to hold your money, banks are willing to pay higher rates on your 18-month deposits, thus boosting your savings a little bit more.
Let’s say you deposit $1,000 into a bank’s 3% APY 18-month CD. At maturity, you’ll have earned around $46. Making that same deposit into the same bank’s 1-year CD at 2% APY, would earn just a little over $20. Of course, rates vary from bank to bank. That’s why it’s important to look for the best CD rates for each term to make locking your money away more worthwhile.