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Updated on Friday, October 1, 2021
Three-year CDs are a great choice for your mid-term savings goals. They offer higher APYs than 1-year certificates, while avoiding the time commitment of a longer 5-year CD term. To make sure you give your account the best chance to grow your money, you’ll want to find the best CD rates available.
MagnifyMoney can help you find the right 3-year CD for your savings. Using data from DepositAccounts.com, a LendingTree-owned site, we’ve found the highest 3-year CD rates available nationwide. We also looked at each account’s minimum deposit and each bank’s relative health to ensure we featured the best offers.
The 10 best 3-year CD rates in October 2021
1. Lafayette Federal Credit Union — 1.01% APY, $500 minimum deposit
Lafayette Federal Credit Union offers a handful of certificates, including its 3-year Fixed Rate Certificate, which requires $500 to open and earns 1.01%APY. Interest is compounded and paid quarterly. An early withdrawal from this 3-year account will trigger a penalty equal to 360 days of dividends.
Established in 1935 and headquartered in Rockville, Md., Lafayette Federal credit union has branches in Maryland, Virginia and Washington, D.C., plus CO-OP Shared Branches. You can join LFCU if you live or work in its serviced areas, work at a partner company, are an immediate family member of a current member or are a member of the Home Ownership Financial Literacy Council.
2. Quontic Bank — 1.00% APY, $500 minimum deposit
Quontic’s 3-year CD misses first place by just a hair. You can make the minimum initial deposit with funds from an existing Quontic account or an external account by ACH, or you can use Plaid. Interest is compounded daily and credited monthly. You must get consent from Quontic to withdraw money prior to maturity. If they agree, your CD will be closed and you’ll pay a penalty of 2 years’ interest, which will be deducted from your principal if you haven’t yet earned that amount of interest.
Quontic began as a community bank but transitioned to a digital institution in 2009. They are based in New York.
3. Abound Credit Union — 0.95% APY, $500 minimum deposit
Take advantage of Abound Credit Union’s 36-month certificate to earn a rate that easily makes the top half of our list. Plus, it requires a low minimum deposit of only $500. You’ll forfeit 180 days’ dividends, earned or not, if you withdraw the principal early. Interest is compounded and paid quarterly on this CD.
Abound Credit Union was established in Kentucky in 1950 as the Fort Knox Civilian Employees Federal Credit Union, changing to its current name in 2020. Membership is open to members of the military or civil service as well as employees of partner organizations and their families. You can also join if you live, work, study or worship in a few different counties in Kentucky. None of this matches you? You can still join by selecting “other” for qualifications and the credit union will help you sign up.
4. Evansville Teachers Federal Credit Union — 0.95% APY, $1,000 minimum deposit
All of Evansville Teachers Federal Credit Union CDs are available for a minimum deposit of $1,000, including this 3-year certificate. If three years is just a bit too long, you’ll still earn a high APY if you opt for the slightly shorter 30-month CD instead.
You don’t need to be a teacher to join this credit union, which has been around since 1936. You can join Evansville FCU by work, organization or family association or by making a $5 donation to the Mater Dei Friends & Alumni Association.
5. Hiway Federal Credit Union — 0.95% APY, $25,000 minimum deposit
You’ll need $25,000 to contribute if you want to get the high APY on this 36-47 month CD. If you have less cash on hand, but can still swing at least $10,000, you’ll still get an APY that would make this list. Any amount below $10,000 and you might want to go with another institution’s CDs. Also note that you may lose 180 days’ dividends if you need to access your cash before maturity.
Founded in 1931, Hiway Federal Credit Union was established for employees of the Minnesota Department of Transportation. Now almost anyone can join Hiway FCU if you live, work, worship or attend school in the Metro Community Area; work at a qualifying company or government agency; are related or know an eligible individual; join the Minnesota Recreation and Park Foundation or Hiway Credit Union Foundation with a onetime $10 contribution; or join the Association of the United States Army with a one-time $40 contribution.
6. Affinity Plus Credit Union — 0.90% APY, $500 minimum deposit
You need only $500 to get started with a 36-month Basic Certificate from Affinity Plus Credit Union. There is no limit to the amount of your opening deposit. Dividends are compounded and credited monthly, but if you withdraw funds early, it will cost you 180 days’ dividends.
Founded in 1930, Affinity is based in Minnesota. You can join Affinity Plus Credit Union depending on where you work or volunteer, your school, where you live/work/worship or through relatives and roommates. You may also become eligible by joining the Affinity Plus Foundation with a one-time $25 membership fee.
7. USALLIANCE Financial — 0.85% APY, $500 minimum deposit
USALLIANCE Financial offers a high-yield 35-month CD special with a minimum deposit of only $500. USALLIANCE compounds interest daily and credits it monthly. Early withdrawals from the account may trigger a penalty equal to 360 days of interest.
USALLIANCE Financial was founded by IBM employees in 1966. Today, you can join USALLIANCE Financial through your place of residence, employer, place of worship, school or organization. You can also opt to join one of four organizations free to qualify.
8. PenFed Credit Union — 1.00% APY, $1,000 minimum deposit
For a deposit of $1,000, you can lock in this rate on what PenFed terms their Money Market Certificate. Your interest will post monthly on the 36-month CD. If you withdraw any money within the first 365 days of opening the account, the penalty will be the full dividends earned. After that, the withdrawal will cost you 30% of the gross amount of dividends you would have earned if the certificate had reached maturity. When your certificate matures, you can opt to transfer the money to another PenFed account, roll it over into a new certificate, receive a check or request an ACH transfer.
PenFed was founded in 1935. Anyone can join the credit union by opening and maintaining a savings account with them of $5 or more.
9. iGObanking — 0.70% APY, $1,000 minimum deposit
You can open a 36-month certificate with as little as $1,000 to secure this competitive rate. Once your CD matures, you can access your money, choose a new CD term or have the principal and interest instantly transferred to an iGObanking online account. If you take out funds before your CD matures, you’ll lose one year of simple interest on the amount withdrawn.
Located in East Meadow, N.Y., iGObanking is the online banking division of Flushing Bank, which was established in 1929.
10. CommunityWide Federal Credit Union — 0.85% APY, $1,000 minimum deposit
To take advantage of the competitive rates on a CommunityWide Federal Credit Union certificate account, you’ll need to deposit at least $1,000 at opening. The institution offers competitive rates on all CDs, including this 36-month certificate account. CommunityWide Federal Credit Union will assess a penalty on any early withdrawals from a CD that depends on the amount you withdraw and the remaining days of your term.
CommunityWide Federal Credit Union was first founded as the West Washington Association Federal Credit Union in 1967. It landed on its current name in 1985. It is headquartered in South Bend, Ind., and has branches throughout the state in addition to CO-OP Shared Branches. There are a few ways to join CommunityWide Federal Credit Union, including by first becoming a member of Michiana Goodwill Boosters, Marine Corps League of St. Joseph Valley or Habitat for Humanity Helpers.
Inflation impact on 3-year CD rates
Inflation reduces the value of any savings or investment balance, including CDs. Your earnings have to exceed the inflation rate for there to be a real return on your money. While mid- and long-term CDs can lock in a high rate today, there’s still potential for inflation to lower your earnings.
For a more inflation-proof savings strategy, consider stock- and bond-based investment products. They can come in handy for long-term savings since their earnings have a better chance of exceeding the inflation rate.
Should I pay early withdrawal penalties if 3-year CD rates rise?
In today’s current rate climate, the odds don’t point to an increase in 3-year CD rates any time soon. That said, an early withdrawal can sometimes be worth paying the penalties, although you’ll want to do the math and check whether the gains are greater than the costs. Calculate the penalty you would end up paying and ensure it’s lower than the returns on the new CD. This early withdrawal penalty calculator from DepositAccounts.com can run the numbers for you and tell you outright whether breaking your CD is worth it or not.