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Updated on Tuesday, January 12, 2021
Certificates of deposit (CDs) are a great way to safely store your savings at a financial institution, as they offer a guaranteed rate of return, and CD rates tend to be higher than those on traditional savings accounts. Maybe you’ve even heard that credit union CD rates offer higher returns—but is that really the case?
On average, yes. As of June 2019, the average one-year credit union CD had a 1.42% annual percentage yield (APY), compared to the 1.11% APY average among one-year bank CDs.
Using data from DepositAccounts.com, another LendingTree company, we identified the top one-year credit union CD rates, as of January 7, 2021. We then eliminated any credit union with a health rating lower than a B and a minimum deposit no larger than $5,000 identified the top offerings in three categories: restricted, no cost, and best banking app. If there was a tie by APY, we went with the product with the lower minimum deposit. Here are the best one-year credit union CD rates.
Best credit union CD rates with restricted memberships or membership fees
Each of these credit unions have restricted membership criteria, but don’t let that scare you away. If you don’t meet their membership criteria, it’s often possible to make a small donation to their charity of choice in order to become eligible for membership. Furthermore, these credit union CD rates offer some of the highest-returning share certificates out of any category.
State Department Federal Credit Union — 12-Month Share Certificate, 0.80% APY, min. deposit $500
Don’t worry, you don’t need a security clearance from the federal government to join this credit union — you simply need to sign up with the American Consumer Council to begin enjoying the benefits of your new membership.
One of those benefits, should you so choose, includes this 12-Month Share Certificate, which allows you to park your money in an account earning 0.80% APY with a minimum deposit of $500. You’ll have to pay 180 days’ worth of interest if you withdraw your money from the certificate before it matures, but it’s worth noting that you can make a partial early withdrawal — and pay the penalty — without closing out the account completely.
Communitywide Federal Credit Union — 12-Month CD, 0.80% APY, min. deposit $1,000
For over 50 years, Communitywide Federal Credit Union has provided banking services to the citizens of northern Indiana, and now a completely revamped online and mobile portal brings its great rates to you, wherever you are. Membership in Communitywide FCU is open to members of the Michiana Goodwill Boosters or the Marine Corps League of St. Joseph Valley, as well as employees of over 40 companies in the central Midwest region.
In exchange for a $1,000 minimum deposit, Communitywide’s 12-month share certificate earns a 0.80% APY. One great feature is flexibility regarding your dividends, which may be compounded in the certificate, deposited to another share certificate or transferred to another account. There is no automatic renewal of Communitywide’s share certificates, which could be a good thing for savers who like to be reminded to survey the best rates available before rolling over their investments.
Lafayette Federal Credit Union – 1-Year Term Fixed Rate Share Certificate, 0.80% APY, min. deposit $500
Lafayette Federal Credit Union offers a slew of fixed-rate share certificates, ranging in term length from seven months to five years. Its 1-year fixed rate share certificate has an impressive APY of 0.80% with a minimum deposit of just $500. Like most CDs, there are penalties for early withdrawal.
Membership to the Lafayette Credit Union is open to anyone who becomes a member of the Home Ownership Financial Literacy Council, or if you become a member of the American Consumer Council.
Latino Credit Union – 12-Month Certificate, 0.75% APY, min. deposit $500
Latino Credit Union offers a slew of term certificates, ranging in term length from six months to 60 months. Currently, its 12-month certificate features an APY of 0.75% for a reasonable $500 minimum deposit.
Membership to Latino Credit Union is open to anyone who also joins the Latino Community Development Center for a one-time family membership fee of $10.
Connexus Credit Union – 12-Month Share Certificate, 0.71% APY, min. deposit $5,000
This Wisconsin-based credit union cracks our ranking of the best credit union CD rates for its 12-month share certificate’s 0.71% APY. It requires a bit of a hefty minimum deposit of $5,000 to open an account, but its APY is fairly generous compared to its competitors.
Anyone can become a member of Connexus Credit Union by joining the Connexus Association and making a $5 donation.
Technology Credit Union – 12-17 Month Certificate, 0.70% APY, min. $1,000
Technology Credit Union offers a slew of CDs with competitive rates, but its 12 to 17 month term CD stands out with a 0.70% APY and a low minimum deposit of just $1,000. It’s worth noting that if your certificate is not funded within 30 days of opening, it will be closed automatically.
Technology Credit Union is open to anyone who joins the Financial Fitness Association, which has an $8 fee.
Pen Air Federal Credit Union – 12-Month Share Certificate, 0.65% APY, min. deposit $500
Pen Air Federal Credit Union offers an array of certificates of deposit, with term lengths ranging from 3-months to 60-months. Its 12-month CD offering is particularly noteworthy, with a minimum required deposit of $500 and an APY of 0.65%.
Pen Air Federal Credit Union is open to active duty or retired military, civil service employees, employees at select employer groups, as well as anyone who simply joins the Friends of the Navy-Marine Corps Relief Society.
Affinity Plus Federal Credit Union – 12-month CD, 0.65% APY, min. deposit $500
Affinity Plus Federal Credit Union offers a wide array of CDs ranging in term length from three months to 60 months. Currently, it’s offering a competitive rate of 0.65% APY on its 1-year CD. This CD requires a minimum deposit of just $500.
Membership to Affinity Plus is open to anyone who makes a one-time dues payment of $25 to the Affinity Plus Foundation.
Best CD rates for credit unions with no cost to join
The thing about credit unions is that they’re not usually just open to anyone. You usually need to meet some membership criteria in order to get in and get access to all of their really nice products. These credit unions, however, will let you in for free regardless of your personal details. (Note: Only two credit unions met our criteria for this list.)
Unify Financial Credit Union – 1-Year Share Certificate, 0.50% APY, min. deposit $1,000Unify FCU offers decent interest rates on CDs (which it calls share certificates) for a credit union with no cost to join. The interest rate on their 12-month CD, for example, is 0.50%. You’ll need to deposit a minimum of $1,000 to open this CD. If you withdraw your money early, however, you’ll face a substantial penalty.
NASA Federal Credit Union – 1-Year Share Certificate, 0.45% APY, min. deposit $1,000If the rigid inflexibility of CDs makes you leery, NASA FCU might be your best bet. They have a lot of flexible certificates, such as add-on certificates that let you start with as little as $250, and bump-rate certificates that let you opt for a one-time interest rate increase if rates go up. You can even take out a loan from your certificate should you need the cash before it’s matured. You can join NASA FCU with a complimentary membership to the National Space Society.
If you do need to make an early withdrawal, you will face a penalty of 180 days’ worth of interest.
Best CD rates for credit unions with the best mobile apps
By their very nature, CDs aren’t something that require constant attention, poking, and prodding. It’s a set-it-and-forget-it kind of a deal, so you won’t need any spiffy banking apps to use CDs.
But, if you’d like to switch all of your banking to the same institution that holds your CDs, it might be a wise idea to consider one of these credit unions if you’re a digital junkie. Most credit unions lag behind their bank compatriots in terms of mobile banking apps, but these credit unions offer top-notch mobile apps, according to MagnifyMoney’s 2020 mobile banking app analysis.
Delta Community Credit Union – 1-Year Certificate, 0.80% APY, min. deposit $1,000There are many ways to join Delta Community CU, such as living in certain parts of Georgia, being a member of one of their select employers, or being a member of one of their partner organizations. Interestingly, citizens of many countries like Argentina, France, and Peru are also eligible to join.
Delta Community CU used to be the lowest-earning credit union on our list, but recently increased the APY on this product to 0.80% APY. The early withdrawal penalty is 90 days’ worth of interest on a 12-month CD.
Eastman Credit Union – 1 Year Investment Certificate , 0.65% APY, min. deposit $1,000
Eastman Credit Union has pretty restrictive membership requirements. You’ll have to be an employee (or a family member of an employee) of one of their select employers, or live in certain parts of Tennessee, Texas, or Virginia.
This product yields 0.65% APY for its 1 year certificate of deposit, with a minimum deposit of $1,000. If you withdraw your money before the CD matures, you’ll owe a penalty fee of 90 days’ worth of dividend earnings.
America First – 12-23 Month CD, 0.35% APY, min. deposit $500America First Credit Union’s collection of CDs range in term length from three months to 60 months. Currently, it is featuring an APY of 0.35% on its 12-23 month CD, which requires a minimum deposit of just $500. America First also offers ladder, bump, dedicated savings and flexible CD options.
Membership to America First Credit Union is limited to people who live, work, regularly conduct business, worship, attend school or volunteer in certain counties of Utah and Nevada, as well as people in select employer groups.
Redstone Federal Credit Union – 12 Month Share Certificate, 0.16% APY, min. deposit $1,000
You can’t just make a simple donation to join to Redstone Federal Credit Union if you fail to meet their membership criteria. You need to be a government employee or contractor, a member of the military, reserve, or National Guard, or affiliated with a number of organizations listed on their website among other options.However, if you do qualify for membership, you could earn an APY of 1.51% with a minimum deposit of $1,000. Redstone FCU has compounding and non-compounding certificates, which allow you to have the option to withdraw interest earned or not throughout the term of the certificate.
BECU – 12-17 Month CD, 0.05% APY, min. deposit $500BECU offers an array of certificates of deposit, with term lengths ranging from 12 months to 47 months. Currently, BECU’s 12-17 month CD offers depositors an APY of 0.05% on balances between $500 and $49,999.99. BECU also offers a Member Advantage rate of 0.30% APY for the same certificate.
Membership to BECU is restricted to those who live, work, worship or go to school in Washington state and certain Idaho counties, as well as people who live or work in certain Oregon counties or those who belong to select associations.
3 questions to consider before opening a credit union CD
Banks are more likely to call their products certificates of deposit, while credit unions often refer to them as share certificates. Aside from the name, the biggest difference between the two is that credit unions have higher average annual percentage yields (APYs) than traditional banks, as of September 2018. That’s good news: It means more money back in your pocket when the CD matures (i.e., reaches the end of its term and is available for withdrawal).
There really is no difference in safety between depositing money in a CD with a credit union versus a bank, as long as they participate in either the National Credit Union Administration (NCUA) for credit unions, or the Federal Deposit Insurance Corporation (FDIC) for banks.
According to Neal Frankle, a Los Angeles-based Certified Financial Planner with Wealth Pilgrim, deposits of up to $250,000 per financial institution are “backed by the full faith and credit of United States Government, so it’s pretty solid.”
For the most part, choosing a CD at a bank or a credit union boils down to your preference as a consumer: Do you want to be a bank customer or a member of a credit union? Here’s a primer on the differences.
The biggest advantage of credit union CDs over bank CDs is that you can likely earn more interest. But with both products, the longer the CD term, the more interest you will earn. And with a CD laddering strategy, you can have the best of both worlds: frequent access to your money, yet you can still keep it locked away in high-interest, long-term CDs.
Beyond that, the disadvantages of opening a credit union CD are the same as if you’re opening a CD with a bank. You can’t access that money without paying an early withdrawal penalty until the CD matures. While CDs do offer some of the highest rates for any financial product you’re likely to come across at a bank or credit union, they still don’t really earn great interest. If you’re investing for the long-term (like retirement savings), your money is better invested in the riskier (but higher-earning) stock or bond market.