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Short-term certificate of deposit (CD) accounts offer investors a safe opportunity to squirrel away money for a future expense. If you’re looking for a brief solution for storing your cash and want to earn more interest than a typical savings account will offer, a 6 month CD can make a lot of sense. (It’s also a good place to start if you’re building a CD ladder.)
Using information from DepositAccounts.com, another LendingTree company and a database of offerings at more than 17,100 banks and credit unions, we found the five banks and five credit unions with the top 6 month CD rates. If there was a tie, we chose the institution with the smaller minimum deposit requirement. We excluded promotional offerings. The national average APY on 6 month CDs (among banks and credit unions) is 0.871%, according to the DepositAccounts.com database. These options outperform that average by a long shot. (You may also want to view our picks for the overall best CD rates.)
Banks with the best 6-month CD rates
|Bank||APY||Minimum deposit amount|
|Nationwide by Axos Bank||1.95%||$500|
Northfield Bank — 2.05% APY, $2,500 minimum deposit
Save with a slightly longer Northfield Bank Certificate of Deposit and an even better rate when you open its 9-month CD online. You’ll need at least $2,500 to get started.
Founded in 1887, Northfield Bank is headquartered in Woodbridge, N.J., serving members nationwide as well as those in the New York and New Jersey areas with its physical locations. The bank provides online and mobile access for all customers.
BrioDirect — 2.00% APY, $500 minimum deposit
If you’re willing to wait a little longer for your CD to mature, you can open BrioDirect’s High-Rate 9-Month CD with at least $500. You’ll still snag one of the best short-term CD rates out there. BrioDirect will assess a penalty of 90 days interest whether earned or not on any early withdrawals.
BrioDirect is the online brand of Sterling National Bank, which was founded in 1888.
HSBC Direct — 1.85% APY, $1,000 minimum deposit
HSBC Direct offers a true high-yield 6 Month CD, earning 1.85% APY on all balances starting at $1,000. You must fund an HSBC Direct CD with new money. Making an early withdrawal will trigger a penalty of 30 days simple interest.
HSBC Direct is an online banking arm of HSBC which spans 65 countries and territories around the world. HSBC is headquartered in Tysons, Va.
Nationwide by Axos Bank — 1.95% APY, $500 minimum deposit
Snag this competitive 6 Month CD rate from Nationwide by Axos Bank, a rate better than its longer 9-month-term counterpart. It requires at least $500 to open.
Nationwide has partnered with Axos Bank to provide Nationwide customers with a wider financial package. An entirely digital bank, Axos Bank was founded in 2000 and is headquartered in San Diego, Ca.
BankUnitedDirect — 1.90% APY, $1,000 minimum deposit
Boost your rate (and maturity wait time) a bit with BankUniredDirect’s 9-Month Online CD. It earns 1.90% APY and requires a $1,000 minimum deposit to get started. Interest is compounded and paid monthly. The early withdrawal penalty for the 9-Month Online CD would be an amount equal to 30 days simple interest on the amount withdrawn.
BankUnitedDirect is the online banking division of BankUnited, N.A., which itself is a subsidiary of BankUnited, Inc. BankUnited was founded in 2009.
Credit unions with the best 6-month CD rates
|Credit Union||APY||Minimum deposit amount|
|NASA Federal Credit Union||2.35%||$10,000|
|Consumers Credit Union||2.05%||$250|
|Andrews Federal Credit Union||2.05%||$1,000|
NASA Federal Credit Union — 2.35% APY, $10,000 minimum deposit
If you have $10,000 in new money to deposit and are willing to wait a bit longer for your CD to mature, open a 9 Month Share Certificate Special from NASA Federal Credit Union. Withdrawal of funds before maturity will result in the loss of 182 days of dividends on the amount withdrawn. When this Special matures, it will renew into a 6 Month Share Certificate.
You don’t need to be a NASA employee to join the credit union. You can also join if you’re an employee or member of partner companies or associations or relative or household member of a current member. Even if these don’t apply to you, NASA Federal will provide a complimentary one-year affiliated membership to the National Space Society (NSS), which gains you credit union membership as well.
Consumers Credit Union — 2.05% APY, $250 minimum deposit
To get a little extra boost on a short-term CD, consider the 8 Months CD from Consumers Credit Union instead of its 6 Months account. You’ll earn more interest, still with the low starting amount of $250. Just don’t make an early withdrawal from the account, as it will result in a loss of 60 days of dividends.
Andrews Federal Credit Union — 2.05% APY, $1,000 minimum deposit
To earn the top credit union rate, head to Andrews Federal Credit Union for its slightly longer 8-Month Share Certificate. It earns at a rate comparable to longer-term CDs and higher than the top 6-month CD rate from a bank/ You’ll need at least $1,000 to open the account either online or at an Andrews FCU branch. The early withdrawal penalty equals 90 days of dividends.
Andrews Federal Credit Union was founded in 1948 and is headquartered in Suitland, Md. It currently serves over 120,000 members worldwide. Andrews FCU membership includes residents of Washington, DC, Maryland, Virginia and New Jersey, including Joint Base Andrews and Joint Base McGuire/Dix/Lakehurst. It serves military installations abroad in central Germany, Belgium and The Netherlands. Andrews FCU also extends membership to Select Employee Groups throughout Maryland, Virginia and New Jersey.
USALLIANCE Financial — 2.00% APY, $500 minimum deposit
With just $500, open a 9 Month USALLIANCE Financial Fixed Rate Certificate account. The early withdrawal penalty equals 180 days dividends on the amount withdrawn.
USALLIANCE Financial was founded in 1966 by a group of International Business Machines Corporation (IBM) employees. Today, membership is open to employees at various other companies, as well as members of select organizations and New York and New Jersey communities.
Elements Financial — 2.00% APY, $1,000 minimum deposit
Elements Financial offers this more competitive rate on its 8 Month Term Certificate Special. Like its regular certificates, it requires $1,000 to open. Upon maturity, this certificate will renew as a 6 Month Term Certificate. Careful to not make an early withdrawal from this account as you’ll lose 60 days’ dividends.
Headquartered in Indianapolis, Ind., Elements Financial was established in 1930 by the management of Eli Lilly and Company. Today, membership is open to employees of over 135 partner organizations in the country.
Pros and cons of using 6 month CDs
- The CD rates offered by banks and credit unions are generally higher than those on savings accounts.
- The rates are fixed and guaranteed for the length of their term.
- The discipline of keeping the funds in the CD means the money will be available upon maturity. (Note: Most banks offer a seven-day grace period to reinvest or withdraw the investment, after which the funds will roll over into a new CD. However, you are not guaranteed the same rate.)
- Six-month CD rates are lower than those offered on longer CD investment terms.
- To tap into the CD funds — even for emergencies — consumers must accept a loss through penalties, which can include a percentage of the funds, a percentage of the earned interest, or a combination of both. A typical penalty on a short-term CD is between 30 and 90 days’ worth of interest earnings.
- If you’re not confident you can do without access to the funds for six months, you may be better off putting your money in a traditional savings account, which is likely to earn less interest than a CD.
- Since CD rollovers may reset at a different percentage rate, consumers must speak with the bank before the grace period ends to ensure they are getting the best deal.
Using a 6 month CD for laddering
A CD ladder comprises small-amount CDs with varying terms and respective interest rates that contribute to a long-term investment strategy. After the 6 month CD matures, investors can withdraw the funds for a predetermined expense. Or, they can reinvest the money into a longer-term CD with a better rate. By staggering the maturity dates on short-term CDs, consumers have access to their cash on a regular, predictable basis.
Where can you open a CD account?
Consumers can open 6 month CD accounts (or longer) from banks and credit unions. Bank and credit union CD rates are based on Federal Reserve rates, and there may be strategic times to pursue these short-term instruments following a rate increase.