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The Best No-Penalty CD Rates in 2020

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

CDs, or certificates of deposit, work under an easy-to-understand premise: You agree to place your money with a bank or credit union for a set amount of time, during which it will earn interest. At the end of the period, you get your money back plus a nice chunk of interest earnings. But if you withdraw money from your CD before the term expires — or before the CD “matures,” in financial parlance — the institution will charge you a penalty fee for breaking the terms of your agreement.

Generally depositors understand that they can’t touch their funds while they’re in the CD account. But the accounts below are special CDs that let customers withdraw money from a CD account with no penalty charge at whatever time they want. No-penalty CDs aren’t generally widespread, but we’ve selected the best of these accounts available nationwide, based on the following criteria:

  • An APY of at least 1.80%
  • No penalties for early withdrawal of funds
  • Available across the nation

The best no-penalty CD rates in April 2020

1. Marcus by Goldman Sachs®

TermAPYMinimum balance to earn the APY
7-month1.70%
$500
11-month1.60%
$500
13-month1.50%
$500

Marcus by Goldman Sachs stakes a strong claim to offering the best no-penalty CDs around, requiring a mere $500 deposit for customers to start earning solid APYs beginning at 1.50%. Interested customers should be aware, however, that like other no-penalty CDs on this list, the accounts offered by this bank lock in your money for seven days after you deposit. You can’t open a 7-month no-penalty CD on Monday and take out your money on Wednesday (if you needed to for whatever reason).

In addition, these accounts don’t allow any partial withdrawals of the principal. If you deposited $1,000 in an account and want to withdrawal money before that CD matures, you won’t be hit with any penalties — but you have to take out all $1,000 and your account will then be closed.

SEE DETAILS Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

2. CIT Bank

TermAPYMinimum balance to earn the APY
11-month 1.65%$1,000

If you have the $1,000 minimum deposit for this no-penalty CD account, CIT Bank will give you a rate of 1.65% APY on an 11-month term. While that’s not as much as you can earn with a comparable CD term with some of the options above, the deal offered by CIT could provide a decent alternative.

SEE DETAILS 

Member FDIC

3. Ally Bank

TermAPYMinimum balance to earn the APY
11 months1.40%Up to $5,000
11 months1.50%$5,000
11 months1.55%$25,000

Online-only bank Ally offers a single no-penalty CD account with an 11-month term that earns more APY depending on how much you deposit. Because it has a low minimum balance requirement, this account will attract consumers without a lot of money to spare who still want a no-penalty CD. Higher balances can earn better APYs.

Similar to all of the other products listed, this Ally no-penalty CD account makes you wait for the seventh day after the initial deposit to withdraw your funds, and the bank doesn’t allow for partial withdrawals. The bank also offers what it calls its 10 Day Best Rate Guarantee, promising that if depositors fund this CD within 10 days of opening it, Ally will make sure the account earns the highest rate available should the bank change its rate within that 10 day period. It’s by no means a game-changer, but a nice bonus to avoid feeling left out if you deposit a pile of money in your CD on Thursday, only to discover on Friday that Ally hiked its rates.

SEE DETAILS Secured

on Ally Bank’s secure website

Member FDIC

4. Citizens Access Liquid CD

TermAPY Minimum balance to earn the APY
11 months1.35%$5,000

Another no-penalty CD hails from online-only bank Citizens Access. This bank is backed by Citizens Bank N.A., which has roots dating back 190 years and has over $150 billion in assets.

Citizens Access calls its no-penalty CD a Liquid CD, but it functions in the same way as the other products on this list. It only offers one Liquid CD, which has an 11-month term and a current APY of 1.35%. There is a $5,000 minimum deposit required for this CD, and it features no penalty for a one-time withdrawal of its entire balance as soon as seven days after funding.

SEE DETAILS Secured

on Citizens Access’s secure website

Member FDIC

5. My eBanc

TermAPYMinimum balance to earn the APY
11-month1.10%$10,000
11 months1.20%$100,000

This Florida-based online savings bank may go by a somewhat generic name, but it’s a division of BAC Florida Bank, a financial institution with more than 45 years of history. The no-penalty CD offered here is called the Flex Time Deposit, and if customers who deposit at least $100,000 can earn an APY of 1.20%, which ranks at the top of the accounts on this list. Depositing at least $10,000 will earn you a decent APY of 1.10%.

Where this account truly shines is that it allows for two partial withdrawals of your funds without having to close your CD account entirely (as long as the balance still remains at $10,000 or more). All of the other no-penalty CD accounts on this list require you to withdrawal all of the principal and any interest earned.

SEE DETAILS Secured

on My eBanc’s secure website

Member FDIC

6. Investors eAccess

TermAPYMinimum balance to earn the APY
6-month1.15%$500

Another no-penalty CD requiring a minimal balance is the 6-month CD offered by Investors eAccess. This New Jersey bank provides one of the most competitive products when it comes to short-term CDs in the no-penalty category, but it does come with a few caveats.

First of all, there are no partial withdrawals allowed by this CD. If you need to take money out, you have to liquify the entire account. You’ll also receive your funds via paper check sent first class mail, so don’t expect an instantaneous turnover of funds should you want to make an early withdrawal. That said, the APY and low minimum account balance make this an excellent choice for short-term savings.

SEE DETAILS Secured

on Investors EAccess’s secure website

Member FDIC

7. PurePoint Financial

TermAPYMinimum balance to earn the APY
11-month1.01%$10,000
13-month0.95%$10,000
14-month0.90%$10,000

The online arm of Union Bank offers a great APY among the no-penalty CD accounts reviewed, which makes it a no-brainer — assuming you have the $10,000 needed for the minimum deposit. PurePoint’s sweet spot is the 11-month term no-penalty CD account, which offers an APY of 1.01%.

This no-penalty CD accounts come with the usual caveats — you can’t make any partial withdrawal of funds, and you have to wait seven days after your initial deposit before withdrawing. However, if you have the sizable chunk of change needed to open one of these accounts, you’ll earn some of the highest APY for your money.

SEE DETAILS Secured

on PurePoint Financial’s secure website

Member FDIC

8. Chartway Credit Union

TermAPYMinimum balance to earn the APY
12-month share certificate1.00%
$500

This credit union may be based in Virginia Beach, Va., but you can potentially become a member, so long as they meet one of the following conditions:

  • You reside or go to school or a place of worship in one of the areas served by a local branch of the credit union. Currently, Chartway Credit Union operates branches in the states of Florida, Texas, Utah and Virginia.
  • You have a family member who’s already a Chartway member
  • You or someone in your immediate family works at a company that utilizes Chartway’s financial services for its employees
  • You make a $10 donation to the We Promise Foundation, a charity founded by the credit union.

Once you’re a member, you can open a 12-month share certificate. Doing so requires a minimum deposit of $500, on which you’ll earn an APY of 1.00%. As with all the other no-penalty CD accounts listed, you can’t make a partial withdrawal of your funds — it’s all or nothing.

SEE DETAILS Secured

on Chartway Federal Credit Union’s secure website

NCUA Insured

9. Colorado Federal Savings Bank

TermAPY Minimum balance to earn the APY
11 months0.70%$5,000

Branchless bank Colorado Federal Savings Bank offers an array of financial products, including a number of certificates of deposit ranging from a 1-month to a 60-month. Among its CD offerings is a no-penalty CD that is worth highlighting.

The Colorado Federal Savings Bank features an 11 month no-penalty CD with an APY of 0.70%. This CD requires a minimum deposit of $5,000, with no maximum deposit limit. As a no-penalty CD, you’re able to withdraw the CD’s full balance – including interest and principal – with no penalty, seven days after you begin funding the account.

SEE DETAILS Secured

on Colorado Federal Savings Bank’s secure website

Member FDIC

What to watch out for with no-penalty CDs

Although no-penalty CDs, like any certificate of deposit, carries with it minimal risk of losing your principal, it’s important you thoroughly understand the terms of the account and understand what circumstances you can withdraw funds. Otherwise, your supposedly no-penalty CD will start devouring your funds with fees.

One of the biggest differences between no-penalty CDs lies with whether you can make partial withdrawals or if you have to withdraw the entire amount. If the account allows for partial withdrawals, make sure you understand if the bank or credit union considers a full withdrawal (and closure of the account) count toward your withdrawal limit. It’s easy to imagine a scenario where you skim the fine print, read a CD allows for two partial withdrawals, make those two withdrawals, then get hit with a penalty when you later try to close the account early because the bank considers that a “third” partial withdrawal.

Another concern you should have when shopping for no-penalty CDs is whether or not the bank or credit union will continue to offer it. AgFed Credit Union, for example, occasionally offers competitive no-penalty share certificates but they’re only available for funding for a limited time. If you snooze on some of these no-penalty CDs, don’t be surprised if they have vanished by the time you are ready to pull the trigger and fund one.

Learn more: Is a no-penalty CD worth it?

According to Ken Tumin, our in-house savings expert and founder of LendingTree-owned DepositAccounts.com, no-penalty CDs aren’t a bad option since there isn’t really much risk to trying one out. Just aim to find the longest term no-penalty CD deal you can since the rates will generally be higher.

“When the bank has your money for longer, they’ll usually offer a higher interest rate — and that interest will have more time to compound,” Tumin says. “So if you open a no-penalty CD, you should go for the one with the longest term possible. The rates will likely still be higher, and after all, if you decide to take the money out early, it’s no problem.”

Also, look for no-penalty CDs that offer the benefit on full withdrawals. Some banks only allow penalty-free partial withdrawals, Tumin warns.

Building a CD ladder to avoid withdrawal fees

If you’re interested in using CDs while still maintaining access to your funds, there’s another approach you could consider: building a CD ladder.

It’s can be a complicated strategy, but in short, you split your deposit up into smaller chunks and open several CDs with various term lengths. When the CDs reach maturity, you can renew the account and lengthen the term or withdraw the money if you need to. This way, you can take advantage of higher interest rates while still avoiding early withdrawal fees.

For a step-by-step guide to building a CD ladder, check out our guide linked above. And for even more savings strategies and tactics, keep your eye on the blog. We’re always reviewing the latest financial products and accounts to help you find the best solutions for your money.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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The Best IRA CD Rates – April 2020

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Perhaps you’ve decided to build a CD ladder within your IRA, or maybe you’re looking for a safe way to store your retirement cash for a specific period of time. Whatever the reason, you’re interested in getting an IRA CD and, understandably, want to know what products will give you the best rate of return.

You can get an IRA CD with terms ranging from three months to more than six years, with interest rates generally increasing with the term length. There are lots of options, so we’ve rounded up the top IRA CD rates that are available right now for a variety of terms. You’ll select your IRA CD terms based on your CD-ladder master plan or whenever you’ll need access to your money.

Every month, we choose the best IRA CD rates using data from another LendingTree company DepositAccounts.com, a database of offerings at more than 17,100 banks and credit unions. We sorted the products by APY, then eliminated institutions with a health rating below a B. We then eliminated products that are not available nationwide. From there, we chose the IRA CD with the highest APY among products with a minimum deposit no greater than $5,000. Here are the best options.

The best IRA rates in April 2020

Term

Institution

APY

Minimum Deposit Amount

3 months

BethPage FCU

0.90%

$50

6 months

Communitywide FCU

1.45%

$1,000

12 months

Pen Air FCU

1.70%

$1,000

18 months

Pen Air FCU

1.80%

$500

2 years

Hughes Federal Credit Union

1.97%

$1,000

3 years

Hughes Federal Credit Union

2.22%

$1,000

4 years

Pen Air FCU

2.10%

$500

5 years

American 1 Credit Union

2.27%

$50

6+ years

Evansville Teachers FCU

1.50%

$1,000

 

Best 3-month IRA CD – BethPage Federal Credit Union (Traditional, Roth)

3 Month IRA from Bethpage Federal Credit Union
The BethPage Federal Credit Union features the most competitive 3-month IRA CD that’s currently available, with an APY of 0.90% and a minimum deposit of just $50.

SEE DETAILS 

NCUA Insured

Best 6-month IRA CD  – Communitywide Federal Credit Union (Traditional, Roth)

6 Month IRA from Communitywide Federal Credit Union
CommunityWide Federal Credit Union is offering the highest rate available on 6-month IRA CDs at 1.45% APY for deposits of $1,000 and over. It has other IRA CD products, too, with term lengths ranging from 6 to 60 months.

SEE DETAILS Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

Best 12-month IRA CD, 18-month IRA CD and 48-month IRA CD – Pen Air Federal Credit Union (Traditional, Roth, SEP, CESA)

48 Month IRA from Pen Air Federal Credit UnionPen Air Federal Credit Union is currently offering a competitive rate on its 12-month IRA CD and 18-month IRA CD, with a 1.70% and 1.80% APY respectively. There is a minimum deposit of $500 required for this account, according to DepositAccounts. Pen Air also has the best 4-year IRA CD, with an APY of 2.10% on its 48-month CD.

SEE DETAILS Secured

on Pen Air Federal Credit Union’s secure website

NCUA Insured

Best 2-year IRA CD and 3-year IRA CD — Hughes Federal Credit Union (Traditional, Roth, SEP)

36 Month IRA from Hughes Federal Credit UnionThis credit union based in Arizona allows anyone in the country to qualify for membership provided they make a $10 donation to one of several associations, including Friends of the Oro Valley Public Library, Friends of the Pima County Public Library, Friends of Green Valley Library, and Friends of Kirk-Bear Canyon Library. The high APY and relatively low minimum deposit makes this IRA CD a great choice.

SEE DETAILS Secured

on Hughes Federal Credit Union’s secure website

NCUA Insured

Best 5-year IRA CD – American 1 Credit Union (Traditional, Roth, CESA)

5 Year IRA from American 1 Credit UnionThe American 1 Credit Union ranks on our list for the best 5-year IRA CD. This CD has a minimum of just $50 and an APY of 2.27%. Membership to this credit union is open to anyone through membership of the Community 1 Cooperative, which has just a $3 fee.

SEE DETAILS Secured

on American 1 Credit Union’s secure website

NCUA Insured

Best 6-year IRA CD — Evansville Teachers FCU (Traditional, Roth, CESSA)

6 Year IRA from Evansville Teachers Federal Credit UnionTo join this credit union, you may make a $5 donation to the Mater Dei Friends & Alumni Association. You may want to strongly consider doing so, as the 6-year IRA CD rate offered by Evansville FCU is the best on the market in terms of APY. Plus, it only requires a minimum balance of $1,000.

SEE DETAILS Secured

on Evansville Teachers Federal Credit Union’s secure website

NCUA Insured

3 questions to consider before opening an IRA CD

Opening an IRA CD generally requires filling out a form or talking to a banker. You’ll have to have a way to fund your IRA CD, whether that’s rolling over an existing retirement account into an IRA CD or depositing cash into the product. The same limits that apply to IRA contributions apply to IRA CDs: $5,500 per year ($6,500 if you’re over age 50) of your own money across all your IRA accounts each year, and you can do a rollover once per year.

Unless you’ve invested in a bump-up IRA CD, you won’t be able to take advantage of a higher rate until your CD matures. Withdrawing funds from an IRA CD before they mature will result in a stiff penalty. Bump-up IRA CDs give you a chance to increase your interest rate to a higher level if it’s available, but you’re generally only allowed to do this once or twice during the life of the CD.

You can either use the direct-transfer method or the indirect-transfer method. The direct transfer method requires setting up your new IRA account filling out a form authorizing the bank or credit union to transfer money from the old account into the new account. The indirect transfer method involves you asking for a check from your old IRA account. You have up to 60 days to deposit that check into your IRA CD to avoid incurring a penalty.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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The Best 18-Month CD Rates in 2020

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

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 1.90% APY, compared to the average 18-month CD rate of 1.32%. 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 April 2020

InstitutionAPYMinimum deposit amount to earn APY
American Express National Bank1.50%$0
Live Oak Bank1.90%$2,500
Merrick Bank1.87%$25,000
Marcus by Goldman Sachs Bank USA1.85%$500
Pen Air Federal Credit Union 1.80%$500
Barclays1.75%$0
Ally Bank1.75%$0
CFG Bank1.75%$500
Discover Bank1.55%$2,500
CIT Bank1.72%$1,000

American Express National Bank — 1.50% APY, no minimum deposit

The 18-month CD from American Express National Bank is our top pick. If you withdraw your principal balance or the account is closed for any reason before maturity, however, you’ll forfeit 270 days’ interest, a heavy hit to your earnings.

American Express National Bank offers a lineup of online Personal Savings deposits products, including its CDs and High Yield Savings Account. Based in Sandy, Utah and established in 1989, American Express National Bank is a part of the larger American Express company, which was founded in 1850.

SEE DETAILS Secured

on American Express National Bank’s secure website

Member FDIC

Live Oak Bank — 1.90% APY, $2,500 minimum deposit

With competitive CD rates across the board, it’s no wonder Live Oak Bank’s 18-month CD makes it on this list. You’ll need at least $2,500 to open an account. Interest earned can be paid out monthly. An early withdrawal will cost you a penalty equal to 90 days of interest on the amount withdrawn.

Largely focused on loans and business banking, Live Oak Bank doesn’t have any consumer bank branches other than its headquarters in Wilmington, N.C. It was founded in 2008.

SEE DETAILS Secured

on Live Oak Bank’s secure website

Member FDIC

Merrick Bank — 1.87% APY, $25,000 minimum deposit

Merrick Bank may offer only a few CDs, but they all earn at excellent rates, including its 18-month CD. Just note that you’ll need at least $25,000 to open one of these accounts. The early withdrawal penalty for an 18-month CD is equal to 2% of the account balance or seven days’ interest, whichever is greater.

Founded in 1997, Merrick Bank is headquartered in South Jordan, Utah, which is also the bank’s only physical branch location. Still, you can find a wide range of financial products online like loans and financing products along with CDs.

SEE DETAILS Secured

on Merrick Bank’s secure website

Member FDIC

Marcus by Goldman Sachs Bank USA — 1.85% 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 1.85% 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, available only in the Apple App Store.

SEE DETAILS Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

Pen Air Federal Credit Union — 1.80% 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 1.80% 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.

SEE DETAILS Secured

on Pen Air Federal Credit Union’s secure website

NCUA Insured

Barclays — 1.75% APY, no minimum deposit

With no minimum balance or deposit required to open, Barclays offers its highest CD rate on its mid-term CDS, including its 18-month CD. Their online CDs are FDIC-insured and have no hidden monthly fees, but there is a penalty for withdrawing principal before maturity: 90 days’ simple interest on the amount withdrawn for terms less than 24 months or 180 days’ simple interest on the amount withdrawn for terms more than 24 months. Interest is compounded daily.

Barclays Online Savings and CD accounts are part of the bank’s Online Banking business, a division of UK-based Barclays. Established in 2001, Barclays Online Savings is based in Wilmington, Del.

SEE DETAILS Secured

on Barclays’s secure website

Member FDIC

Ally Bank — 1.75% APY, no minimum deposit

There is no minimum deposit to qualify for this 18-month CD rate at Ally Bank. Ally maintains the most generous early withdrawal penalty on this list, charging only 60 days’ worth of interest.

Ally Bank traces its history back to 1919, as the financing branch of GM, but today operates entirely online.

SEE DETAILS Secured

on Ally Bank’s secure website

Member FDIC

CFG Bank — 1.75% APY, $500 minimum deposit

The minimum balance for this CFG Bank CD is $500, and no additional deposits are allowed after opening. These accounts are subject to an early withdrawal penalty, and any withdrawal within the first six days of opening an account will incur a penalty of 7 days’ interest.

CFG Bank is privately owned and operated by an entrepreneur. Its headquarters are in Baltimore, Md.

SEE DETAILS Secured

on CFG Bank’s secure website

FDIC Insured

Discover Bank — 1.55% APY, $2,500 minimum deposit

Among Discover Bank’s high-yield CDs is its 18-month account, which you can take advantage of starting with an opening deposit of $2,500. You’ll lose 6 months’ simple interest if you make a withdrawal before maturity.

Discover Online Banking offers a variety of online-only and high-yield banking products. Online Banking is a part of the larger Discover organization, which started in the credit card business in 1985.

SEE DETAILS 

Member FDIC

CIT Bank — 1.72% APY, $1,000 minimum deposit

CIT Bank offers its 18-month CD with no account opening or maintenance fees. However, you will need to contribute a minimum of $1,000. Your money is FDIC-insured, and interest compounds daily. As with most CDs, early withdrawal will incur a penalty. Upon maturity, the 18-month CD will be automatically renewed as a 2-Year Term CD at the APY at that time.

CIT Bank is a subsidiary of CIT Group, a financial holding company that was founded in 1908. Today, CIT Bank is headquartered in Pasadena, Calif.

SEE DETAILS Secured

on Bellco Credit Union’s secure website

NCUA Insured

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.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.