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Top 10 Jumbo Money Market Accounts

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Jumbo money market accounts
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What is a jumbo money market account?

When you’re saving money, you want to make sure you’re stashing it in the right place. Ideally, that will be in an account with a high rate of return. While savings accounts tend to offer a higher return than checking accounts, money market accounts  — which are FDIC-insured up to $250,000, unlike money market funds — may yield an even higher rate of return.

That’s if you know where to find the best rates.

The money market accounts that offer the highest returns are known as jumbo money market accounts. In the past, these high-yielding accounts could have minimum initial deposits as much as $100,000, but today, you can get these higher rates with a much lower initial investment and sometimes there’s no minimum at all.

In this roundup, we’ll explore the top rates.

CIT Bank, 1.85% APY, $100 Minimum Deposit

CIT Bank
CIT Bank focuses on banking for businesses, but it does also have consumer products via its online portal and a series of brick-and-mortar locations in Southern California. One of the consumer products accessible online is their high-yield money market account.

With a low minimum deposit of $100, CIT Bank’s money market account still earns a respectable 1.85% APY. You can withdraw your money through People Pay — a free service which allows you to direct the money toward a specific email address or phone number. But remember, you can only make six withdrawals per month. If you go over this amount, you will be charged $10 for each additional withdrawal in a statement cycle, up to $50.

There are no monthly maintenance fees with this account.

LEARN MORE Secured

on CIT Bank’s secure website

Member FDIC

VirtualBank, 2.01% APY, $100 Minimum Deposit to Open

eMoneyMarket from Virtual BankVirtualBank is based in Louisiana but mainly offers access to its deposit products online nationwide.

To open a high-yielding money market account at VirtualBank, you must have a minimum opening deposit of at least $100. From there, your account will earn 2.01% APY for the first year. Then, the APY will drop to 0.80%. If your daily balance drops below $100, you will be charged a $5 fee per month.

To take money out of your account, you can conduct an online transfer. As with all of the accounts on our list, you will only be able to make six withdrawals/transfers per month. If you make more than six withdrawals in a monthly statement cycle, VirtualBank will charge you a $15 fee each time you take out more money.

LEARN MORE Secured

on Virtual Bank’s secure website

BankPurely, 2.00% APY, $25,000 Minimum Deposit

BankPurely
BankPurely is a division of Flushing Bank. Built to attract conscious consumers focused on an ethical lifestyle, this division attempts to build the “community” aspect of a community bank online rather than in person. One of their social initiatives is planting one tree for every new account opened.

To open a PurelyMoneyMarket account with BankPurely, you must have an initial deposit of $25,000. You will be required to keep your account balance at or above $25,000 to earn the account’s 2.00% APY. You will be able to withdraw money using online services and a debit card, but remember to keep it below the six withdrawal per month limit.

LEARN MORE Secured

on BankPurely’s secure website

Member FDIC

Sallie Mae, 1.90% APY, No Minimum Deposit

Sallie Mae Bank
Sallie Mae is probably best known for underwriting mortgages and student loans. However, they also offer deposit accounts direct to consumers.

For example, their high-yield money market account pulls in 1.90% APY with no monthly maintenance fees and no minimum upfront deposit. You can write checks from this account, but keep in mind that you’ll have to stay below six withdrawals per month. If you don’t you’ll be charged a $10 excessive transaction fee. This fee will be applied for each withdrawal after six in a statement period, up to $70 per period. If you make more than seven excessive transactions, the additional $10 fees will be applied to the following month’s statement.

LEARN MORE Secured

on Sallie Mae Bank’s secure website

ableBanking, 1.85% APY, $250 Minimum Deposit

ableBanking
AbleBanking is an offshoot of Northeast Bank, which is based in the state of Maine. While Northeast Bank has been in business since 1872, ableBanking — which has no physical locations and is based completely online — was launched in 2012.

With no monthly maintenance fees, any amount saved in one of ableBanking’s high-yield money market accounts will earn 1.85% APY. To open one of these accounts, you only need a minimum initial deposit of $250.

If you take money out of your account more than six times in a statement cycle, you will be billed a $10 excess fee for each additional withdrawal. If you do this more than twice within a 12-month period, ableBanking may close your account. You can make these withdrawals online, or pay a $20 fee for a wire transfer.

When you join ableBanking as a new customer, the institution will make a $25 donation out of their own pocket to a charity of your choice. To claim this perk, fill out this form, designating which 501(c)(3) you would like to receive the donation.

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on AbleBanking’s secure website

State Bank of Texas, 1.85% APY, $100,000 Minimum Deposit

State Bank of Texas is a family owned and operated bank with a rich history. This bank was built by a man who immigrated to America from India in the hopes of attaining the American Dream. Once he overcame the challenge of acquiring enough capital to open the bank, he opened the bank’s doors on October 19, 1987 – a day known as Black Monday due to the crash of the stock market. With only one employee on the payroll, and a lot of help from his family, the bank successfully made it through one of the worst economic times in history. Today, the bank has thrived with its lending solutions and is quickly becoming a competitor in the deposits space.

To open a jumbo money market account with State Bank of Texas, you must have an initial deposit of $100,000. You will be required to keep your account balance at or above $100,000 to earn the account’s 1.85% APY. You will be able to withdraw money using online services, but remember to keep it below the six withdrawal per month limit.

on State Bank of Texas’s secure website

EBSB Direct, 1.80% APY, $10,000 Minimum Deposit

EBSB Direct
East Boston Savings Bank (EBSB) is a mature financial institution which dates back to 1848. It issues money market accounts with high APYs through its online portal: EBSB Direct.

Technically, to open a money market account with EBSB Direct, you only need $2,500. However, to earn the high interest rate of 1.80% APY, you will need a balance between $10,000-$2,000,000.

If your account has $10-$9,999, you’ll only earn 0.50% APY, and accounts with more than $2 million earn 0.80% APY. To take money out of your account, EBSB will issue you a debit card.

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on EBSB Direct’s secure website

North American Savings Bank, 1.77% APY, $50,000 Minimum Deposit

North American Savings Bank is headquartered in Missouri, but offers products online nationwide. The minimum deposit on North American Savings Bank’s money market account is only $1,000, but if you want to earn the 1.77% APY on your balance, you must keep it at or above that $50,000 threshold. If you do deposit the minimum amount, you can still earn a decent APY of 1.56%. If you balance grows anywhere between $25,000 and $49,999, the APY will increase to 1.66%. You will have online banking capabilities for withdrawals — up to six per month. This account comes with no monthly maintenance fees as long as you maintain a minimum balance of $1,000.

It is important to note that this account is an online only special and is subject to change without any notice.

on North American Savings Bank’s secure website

Capital One 360, 1.75% APY, $10,000 Minimum Deposit

Capital One
Online-only Capital One 360 offers savings accounts, certificates of deposit (CDs), individual retirement accounts (IRAs) and, of course, money market accounts.

If you open a 360 Money Market Account and deposit at least $10,000, your money will earn 1.75% APY. While there is technically no minimum amount required to open one of these accounts, if you have less than $10,000, you will only earn 0.85% APY. You can find higher paying basic savings accounts elsewhere, so it’s better to save that money in a higher-yielding account until you hit the $10,000 threshold.

While this account comes with no fees, it also comes with no checks or debit card. In order to withdraw money — which you can do up to six times per month — you will have to use Capital One 360’s online portal or call in to speak to one of their representatives.

LEARN MORE Secured

on Capital One’s secure website

Member FDIC

My Banking Direct, 1.75% APY, $25,000 Minimum Deposit

My Banking Direct is an extension of New York Community Bank, which was established in 1859. My Banking Direct’s banking services are provided completely online — there is no brick-and-mortar location.

My Banking Direct offers a 1.75% APY on their money market account as long as you have a minimum balance of $25,000. If your balance falls below $25,000, the APY will drop to 1.50%. The APY will drop further to 0.25% if your balance falls below $5,000. You’ll also need a $2,500 minimum deposit to open the account in the first place. There are no monthly maintenance fees associated with this account.

You can make withdrawals from this account using checks, ACH transfers, wire transfers or telephone payments. Keep in mind that you can only make six of these withdrawals per monthly statement cycle. If you make more than six over the course of a month, you may be assessed an excess fee at the bank’s discretion.

on My Banking Direct’s secure website

How these jumbo money market accounts’ rates compare with regular money market rates

Jumbo money market accounts are typically called jumbo because they require a significant deposit to earn the top rate. You may have noticed that many of these accounts do not necessarily have the label “jumbo” attached to them. This is because with the advent of online banking, more and more financial institutions are passing along the savings they incur from not having to maintain brick-and-mortar locations on to their customers via higher returns on products like money market accounts.

For that reason, you’ll notice that many of the highest-yielding accounts on this list can also be found on our Best Money Market Rates & Accounts lineup.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Brynne Conroy
Brynne Conroy |

Brynne Conroy is a writer at MagnifyMoney. You can email Brynne here

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Best Money Market Rates & Accounts – July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Updated July 13, 2018

Traditional banks are paying very low interest rates on money market accounts. For example, BB&T pays between 0.01% and 0.04% APY. Fortunately, you do not need to settle for such ridiculously low rates. You can easily find the best money market rates at internet banks paying 1.50% or more. If you put $50,000 into BB&T’s account at 0.04%, you will only earn $20 of interest over one year. That same money in an account paying 1.50% would earn you $750 of interest. And you can typically open and fund an online money market account in less than 10 minutes. Also, the differences between savings accounts and money market accounts are narrowing because rates on money market account are increasing each year. You can currently earn the same top rate with a savings account from one bank and a money market account from another.

MagnifyMoney searches over 12,000 banks and credit unions to find the money market accounts paying the highest interest rates. Competition has been increasing and there is a pricing war. As a result, this month there are a lot of new names on the list (many of which you probably will not recognize). Here are the best rates for July 2018:

1. High Rate: CIT Bank – 1.85% APY, $100 minimum balance amount

Money Market Account from CIT Bank CIT Bank recently launched a money market account with a 1.85% APY. You only need $100 to open the account and start earning the APY, and they don’t charge any monthly maintenance fees. If you appreciate the option to write checks with your money market account, or use a debit or ATM card to withdraw funds, this account may not be for you. You can fund the account with ACH, mobile check deposit, or by mailing a check directly to the bank. Accessing funds can be easily done through their online banking platform or mobile banking app. Just keep in mind that due to federal regulations, you’re not able to conduct more than six transactions in a statement cycle. CIT Bank will charge a $10 fee for each additional transaction. While CIT is a thriving bank, you can be assured that your funds are protected by the FDIC up to the legal limit.

LEARN MORE Secured

on CIT Bank’s secure website

Member FDIC

2. Favorite Online Package: Ally – 0.90% APY, no minimum deposit, and link to free checking

Online Savings Account from Ally BankAlly Bank is a very popular internet-only bank. If you keep a daily balance of $5,000 or less, you will earn the 0.90% APY. If you’re able to keep a minimum daily balance of $25,000 the APY increases to 1.00%. Although the interest rate on the money market account is not the highest, Ally does offer a very competitive overall package – particularly if you link the account to an Ally checking account. The checking account has no minimum balance and no monthly fee. You can link your money market account to your checking account to provide overdraft protection. Money would be transferred to your checking account with no transaction fee if you ever made a mistake. You would be able to access your money market account with your Ally ATM card, which has free AllPoint access and up to $10 of non-Ally ATM fees reimbursed every month. This money market account is a nice way to provide yourself with overdraft protection while earning interest. If you don’t need check-writing capabilities on your savings, you would still be better off with Ally’s savings account.

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on Ally Bank’s secure website

Member FDIC

3. Highest Overall Rate: Virtual Bank – 2.01% APY, no minimum balance to earn APY

eMoneyMarket from Virtual BankVirtual Bank, a division of IBERIABANK, is currently offering an introductory rate on their money market account that is the highest available. This rate is guaranteed for 12 months and will adjust to the standard rate that is in effect at the time. New customers can earn the 2.01% APY by depositing a minimum of $100. While there isn’t a minimum balance requirement to earn the APY, there is a balance requirement to avoid incurring the $5 monthly service fee. All you’ll have to do is maintain a daily minimum balance of $100 and they’ll waive the monthly fee. While this account doesn’t have any check writing capabilities, you can easily move money in and out of the account via ACH. Virtual Bank has a mobile app, that has the mobile check deposit feature, in addition to their online banking platform.

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on Virtual Bank’s secure website

4. High Rate: BankPurely – 2.00% APY, $25,000 minimum balance, ATM access

BankPurely
BankPurely, a division of Flushing Bank, currently offers a 2.00% APY on their money market account. You’ll have to either deposit a minimum amount of $25,000 or grow your balance to that amount in order to earn interest. If you’re not able to deposit that amount, you may want to go with VirtualBank or Sallie Mae since they have the same rate for a lower deposit amount. However, BankPurely does provide an ATM card, which gives you access to surcharge-free ATMs within the Allpoint Network. Just keep in mind that you’ll be limited to withdrawing $1,000 per business day. Per Federal law, you’ll also be restricted to making six transfers per month. You’ll have access to online banking as well as to their mobile banking app to manage your account. Plus, if you open an account with BankPurely, they’ll plant a tree.

LEARN MORE Secured

on BankPurely’s secure website

Member FDIC

5. Top Choice: Sallie Mae – 1.90% APY, no minimum balance and checks available

Money Market from Sallie Mae BankIf you have student loan debt, you probably are not very excited to see Sallie Mae at the top of this list. However, many people are unaware that Sallie Mae also operates an internet-only FDIC-insured bank with some of the best interest rates in the country. You can earn 1.90% APY, compounded daily and paid monthly. There is no minimum balance and no monthly maintenance fees. You will have check-writing capabilities (although the standard money market limit of six per month applies to this account). The easiest (and best) way to fund and access your funds is via electronic transfer from your existing checking account. If you want a simple account with no fees and check access – this is a good bet. Sallie Mae has just recently increased the APY, making this one the best rates in the country.

LEARN MORE Secured

on Sallie Mae Bank’s secure website

6. High Rate: ableBanking – 1.85% APY, $250 minimum balance, but no check-writing

Money Market Savings from ableBankingableBanking is a division of Northeast Bancorp, a community bank headquartered in Maine since 1872. The bank has over $1 billion in assets, and your deposit would be FDIC insured up to the legal limit. At 1.85% APY, this is the highest money market rate that we have been able to find (from a bank) in the country. There is a minimum deposit of $250, no monthly fee and you do not need to be a resident of Maine (any US resident can open an account). Unfortunately, the account does not come with check-writing privileges and there is no ATM access. You can deposit and access your funds via ACH (electronic transfer), which can take a couple of days. Just remember: there is a limit of 6 withdrawals per calendar month. When we called to ask questions about the account, we could reach a customer service representative very quickly. This is a good option from a small bank with a great high rate.

LEARN MORE Secured

on AbleBanking’s secure website

7. High Rate: EBSB Direct – 1.80% APY, $10,000 minimum balance, checks and ATM access available

EBSB Direct
East Boston Savings Bank, or EBSB Direct, is a fairly large bank located in Massachusetts. They have over $5 billion in assets and have only been around since 1991. Currently, they’re offering a 1.80% APY on their money market account. While you’ll only need $2,500 to open the account, you’ll have to have a minimum balance amount of $10,000 to earn the APY. If you have a balance between $10 and $10,000, you’ll earn an APY of 0.50%. While this account does come with Visa debit card and checks, they do charge a monthly maintenance fee of $8 if you’re not able to maintain a minimum daily balance amount of $2,500 during the statement cycle. You’ll be limited to six transfers per statement cycle per Regulation D and if you exceed that amount of transfer, EBSB Direct will charge $15 per additional transfer. While they offer online banking, they don’t currently have a mobile banking app.

LEARN MORE Secured

on EBSB Direct’s secure website

8. High Rate: Salem Five – 1.75% APY, $100 minimum to open, but no check-writing

Salem Five
With a minimum deposit amount of $100, you can open a money market account with Salem Five. While they don’t offer check-writing capabilities, they do issue a debit card to make withdrawing funds easier. Salem Five also complies with Regulation D by limiting the number of transactions account holders can make to six. If the limit is exceeded, they’ll charge $10 per additional transaction. One other limitation this bank imposes is an External Transfer limit. You will only be able to transfer $5,000 per day and $20,000 per month. So, this account may not be right for you if you tend to withdraw more those amounts. While Salem Five truly does offer a great rate for the right price with this account, they do have a lot of limitations including their online and mobile experience.

LEARN MORE Secured

on Salem Five’s secure website

9. High Rate: My Banking Direct – 1.75% APY, $25,000 minimum balance, checks available

My Banking Direct
My Banking Direct is part of New York Community Bank, which was established in 1859. New York Community Bank created My Banking Direct as a way to offer competitive rates to consumers and the money market account does just that. Currently, the money market account offers a high rate of 1.75%, but only if you deposit and maintain a balance of $25,000. However, you only need $2,500 to open the account and begin earning 0.25% APY. If your balance increases to $5,000 or you deposit the amount when you open this account, you’ll still earn a very good APY of 1.50%. My Banking Direct doesn’t charge any monthly fees on this account and provides check-writing capabilities. In addition to managing this account online, they also have a mobile app with mobile deposit functionality.

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on My Banking Direct’s secure website

10. High Rate: BBVA Compass – 1.70% APY, for new customers, no minimum balance, checking-writing and ATM access

BBVA Compass ClearChoice Savings from BBVA CompassBBVA Compass is currently offering new customers a 1.70% APY on their ClearChoice Money Market account. A new customer is defined as someone who does not have an existing account with them and has not had one in the last 30 days. The rate is guaranteed for 12 months. There isn’t a minimum balance amount to earn the APY, but $25 is needed to open the account. Also, there will be a $15 monthly service fee unless you can maintain a minimum daily balance of $10,000 or have an automatic, recurring transfer of at least $25 each month from a BBVA Compass checking account. This account does come with check-writing capabilities as well as access to BBVA Compass ATMs for free. If you use an ATM that is outside of this bank’s network, you’ll be charge a $3 fee per transaction on top of whatever fees the ATM owners charge. In addition to managing this account online, BBVA Compass has a mobile banking app that has the mobile check deposit feature.

LEARN MORE Secured

on BBVA Compass’s secure website


11. High Rate: Self-Help Credit Union – up to 1.58% APY, $500 minimum deposit and minimum balance

Money Market from Self-Help Credit UnionSelf-Help is a credit union that anyone can join. If you don’t live, work or worship in one of their eligible counties, you can join by donating $5 to the Center for Community Self-Help. The contribution is tax deductible and will make you eligible for credit union membership. (You can learn more about how to join the credit union here.) At a credit union, your funds are insured up to $250,000 – but it is by the NCUA instead of the FDIC. The money market offers an APY of 1.58% on balances from that are at least $500. You also need to maintain the balance during the month – otherwise you will be charged a monthly maintenance fee. You are allowed 6 free withdrawals or transfers from the account each month (including checks).

LEARN MORE Secured

on Self-Help Credit Union’s secure website

Special Mention: Great Rate for Small Deposits: Premier Members Credit Union – 4.00% APY up to $2k

Premier Members Credit Union

Premier Members Credit Union is open to anyone willing to make a $5 donation Impact on Education, a charity for the Boulder Valley School District. This credit union is currently offering an incredible rate of 4.00% with only $5 to open the account. You can earn this APY on balances up to $2,000. Amazingly, even if you grow the balance up to $5,000, you’ll earn 1.49% APY. As the balance increases, the APY decreases to the following:

  • $5,000.01-$10,000: 0.75%
  • $10,000.01-$50,000: 0.50%
  • $50,000.01-$100,000: 0.40%
  • $100,000.01-$250,000: 0.35%
  • $250,000.01+: 0.30%

Premier Members Credit Union rewards low balance savers by placing the highest rate with the lowest deposit, but if the balance grows they start using a reverse tier system where they blend the APY as the balance grows. Checks are available with this account, but you can only make six withdrawals per month. Each additional withdrawal will be assessed a $10 fee.

LEARN MORE Secured

on Premier Members Credit Union’s secure website

3 Questions To Ask Before Opening A Money Market Account

1. Should I open a savings account or a money market account?

Many years ago, money market accounts were higher risk and paid higher returns. The financial crisis of 2008 changed all of that. Money market accounts are now FDIC-insured up to the legal maximum ($250,000 per institution per individual). Interest rates are now very similar – and there is no material difference. In other words – choose whichever account you want.

In general, you tend to get slightly lower interest rates on money market accounts because you have check-writing capabilities. The best savings accounts pay at least 1.50% APY – very similar to the rates on this page. But at Ally, for example, you can get 1.35% APY on a savings account (no check-writing) and 0.90% on the money market account (with check writing).   

We have written a full explanation of the difference between money market and savings accounts here.

2. Am I willing to make a longer term commitment? 

Savings accounts and money market accounts pay much lower interest rates than CDs. Right now you can easily get a 1-year CD paying 1.85% APY (with only a $2,000 minimum). You can find the best CD rates here. If you build a CD ladder, you can take advantage of 5-year rates that are now as high as 3.00%.

Money market accounts are great places to keep money that you might need immediately. But the interest rate on a money market account can change right away, at the bank’s discretion. To lock in a higher interest rate, you should consider a CD. If you need to get access to your CD early, would forfeit interest (typically from 3-6 months). In most circumstances, putting more of your money into CDs can really help boost your returns.

3. Is a money market account the same as a money market fund? 

No, money market accounts (offered by FDIC-insured banks) are not the same as money market funds (most likely sold by your broker). In fact, we really don’t know why people even buy money market funds in the current environment.

For example, Vanguard offers the Prime Money Market Fund. Like other money market funds, this one “invests in short-term, high-quality securities.” Its objective is to keep the fund trading at $1 and generate a decent return. Right now that return is 1.00% – a bit lower than the returns you see from the money market accounts listed in this article. However, money market funds do not have FDIC insurance.

Most people compare the return of a money market fund (sold by their broker) to the interest rate paid by a traditional bank (0.03%, sold by their local bank teller). As a result, they are willing to take the risk of a money market fund. However, as you can see from the best money market accounts in this article, you can get FDIC insurance and beat the return of most funds. Why earn 1.00% with no FDIC-insurance when you can easily earn 1.60% and have FDIC insurance.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Nick Clements
Nick Clements |

Nick Clements is a writer at MagnifyMoney. You can email Nick at nick@magnifymoney.com

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The Best Credit Union CD Rates – July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

The top credit union CD rates
Source: iStock

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 March 2018, the average one-year credit union CD had a 0.79% annual percentage yield (APY), compared to the 0.63% 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 July 12, 2018. We then eliminated any credit union with a health rating lower than a B and identified the top three 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 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, 1.34% APY, min. deposit $1,000

UNIFY Financial Credit Union
Unify FCU offers the highest interest rates on CDs (which it calls share certificates) of any credit union with no cost to join. The interest rate on their 12-month CD, for example, is 1.34%, compared to the national average of 0.68% in December. You would earn $8.50 on a $1,000 deposit. If you withdraw your money early, however, you’ll face a penalty of 90 days’ worth of interest.

LEARN MORE Secured

on UNIFY Financial Credit Union’s secure website

NASA Federal Credit Union – 1-Year Share Certificate, 1.00% APY, min. deposit $1,000

NASA Federal Credit Union
If 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.

LEARN MORE Secured

on NASA Federal Credit Union’s secure website

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 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.

CommunityWide Federal Credit Union – 12 Month CD, 2.50% APY, min. deposit $2,000

36 Month Share Certificate from Communitywide Federal Credit UnionMembership to CommunityWide Federal Credit Union is open to members of the Michiana Goodwill Boosters or Marine Corps. of St. Joseph Valley. However, if you’re not a member of either of those organizations, you can qualify by becoming a donor member of select organizations such as the Y.M.C.A.

Once you’re a member of CommunityWide Federal Credit Union, you can open a 12-month CD with a minimum of $2,000. Their early withdrawal penalty equals the withdrawn amount multiplied by the number of days that remain in the term.

on CommunityWide Federal Credit Union’s secure website

Connexus Credit Union – 12 Month Certificate, 2.50% APY, min. deposit $5,000

12 Month Certificate from Connexus Credit Union With a $5 donation to the Connexus Association, anyone can join Connexus Credit Union. The Connexus Association assists educational institutions by providing scholarships and financial information. Once you become a member of the credit union, you’ll be able to open their 12 month CD with a $5,000 deposit.

If you’re able to deposit $5,000 into Connexus’s 12 month CD, you’ll earn $125 by the end of the term. However, if you withdraw funds early, you’ll be penalized with 90 days’ worth of interest.

LEARN MORE Secured

on Connexus Credit Union’s secure website

PenFed Credit Union – 1-Year Money Market Certificate, 2.35% APY, min. deposit $1,000

PenFed Credit Union
PenFed has an outstanding APY of 2.35%. With a minimum deposit of $1,000, you could earn $23.50 in one year. Interest is compounded daily and posts to accounts monthly. However, be aware of the steep early withdrawal penalty. If you withdraw funds before the year is up, you may forfeit all interest accrued up to that point.

Eligibility for this credit union is mainly based on military status, governmental employment status, affiliation with certain associations and organizations or relation to eligible members. However, if you don’t qualify through those criteria, getting a membership to this credit union is not difficult if you’re willing to pay a one-time fee of $17 to either Voices for America’s Troops or the National Military Family Association.

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

Air Force Federal Credit Union – 1-Year Certificate 2.30% APY, min. deposit $1,000

AFFCU
Members and family members of the military, civilian contractors, and certain employees are eligible to join the Air Force FCU, along with anyone willing to join the Airman Heritage Foundation ($25 annual membership fee).

This credit union comes in first place overall for highest interest rates for 12-month CDs. You can earn an APY of 2.30% by depositing a minimum of $1,000 in a 12-month CD. You can also use your CD as collateral to earn a lower interest rate on a loan, and membership comes with a host of discounts for parks and businesses in the San Antonio, Texas area. Watch out for the early withdrawal penalties, however, worth half of whatever you would have earned between when you withdrew the funds and when it would have matured.

Alliant Credit Union – 12-17 Month Share CD, 2.30% APY, min. deposit $25,000

Alliant Credit Union
 With a minimum deposit of $1,000, you could earn an APY of 2.25% on a 12-17 month CD. If you deposit $25,000 or more, you would be able to earn an APY of 2.30% with the same term. An early withdrawal penalty of 90 days’ worth of interest may be imposed if you withdraw funds prior to the CD’s maturity date.

With a $10 donation to Foster Care to Success, you can easily become a member of Alliant Credit Union. You can also become a member if you are an employee or retiree of certain organizations, related to existing Alliant members, or live or work in qualifying communities.

LEARN MORE Secured

on Alliant Credit Union’s secure website

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 2017 mobile banking app analysis.

Eastman Credit Union – 1-Year Investment Certificate, 2.00% APY, min. deposit $1,000

Eastman Credit Union
Eastman Credit Union also 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.

Eastman CU is another one of the rare credit unions that allow you to withdraw your dividends penalty-free before the maturity date, although again, doing so will lower your total returns. Currently, you can earn an interest rate of 2.00% on a 12-month CD with a minimum deposit of $1,000. If you withdraw your money before the CD matures, you’ll owe a penalty fee of anywhere between seven days’ worth of dividend earnings or all of your dividend earnings.

LEARN MORE Secured

on Eastman Credit Union’s secure website

Redstone Federal Credit Union – 12 Month MemberPlus Regular Share Certificate, 1.95% APY, min. deposit $1,000

Redstone Federal Credit Union
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 1.95% 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.

LEARN MORE Secured

on Redstone Federal Credit Union’s secure website

Wright-Patt Credit Union – 1-Year Certificate, 1.64% APY, min. deposit $500

Wright-Patt Credit Union
Unlike many credit unions, you can’t just make a simple donation to join Wright-Patt CU if you fail to meet their membership criteria. You need to live in certain areas of Ohio, be associated with Wright-Patterson Air Force Base, or be an employee of their select employer group, among other options.

You can earn $8.20 on a 12-month CD with just a relatively small $500 deposit. However, if you’re able to deposit $100,000 or more, you’ll earn an APY of 1.74%, which will return $1,740 in interest. Early withdrawal penalties vary depending on the original term of your CD, however they’ll be anywhere between 5-12 months’ worth of dividends.

LEARN MORE Secured

on Wright-Patt Credit Union’s secure website

Delta Community Credit Union – 1-Year Certificate, 1.25% APY, min. deposit $1,000

Delta Community Credit Union
There 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 from 1.10% to 1.25%. The early withdrawal penalty is 90 days’ worth of interest on a 12-month CD.

LEARN MORE Secured

on Delta Community Credit Union’s secure website

 

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), as of March 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.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

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Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here

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The Best IRA CD Rates – July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Top IRA CD rates
Source: iStock

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. On July 12, 2018, 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. (Average CD rates referenced below are based on DepositAccounts.com data as of July 12, 2018.)

The best IRA rates in July 2018

Term

Institution

APY

Minimum Deposit Amount

3 months

TIAA Bank

1.60%

$5,000

6 months

CommunityWide Federal Credit Union

2.15%

$2,000

12 months

Connexus Credit Union

2.50%

$5,000

18 months

Interior Credit Union

2.68%

$500

2 years

CommunityWide Federal Credit Union

2.90%

$2,000

3 years

Salem Five

3.00%

$2,000

4 years

CommunityWide Federal Credit Union

3.20%

$2,000

5 years

Achieva Credit Union

4.00%

$500

Rates as of July 12, 2018

3 Month IRA CD – TIAA Bank, 3 Month Yield Pledge IRA (Traditional, Roth)

3 Month Yield Pledge IRA from TIAA BankThree-month regular CDs are earning an average interest rate of 0.35% APY currently. EverBank is exceeding that, with an interest rate of 1.60% APY with their 3-Month Yield Pledge IRA CD. With that APY and a $5,000 minimum deposit, you would earn $19.88 when the certificate matures.

LEARN MORE Secured

on TIAA Bank’s secure website

6-Month IRA CD – CommunityWide Credit Union, 6 Month IRA (Traditional, Roth)

60 Month IRA from Communitywide Federal Credit Union
Six-month IRA CDs typically earn a little bit better, but they’re normally still not great. CommunityWide Federal Credit Union, however, is breaking that norm by offering the highest interest rate at 2.15% APY for deposits of $2,000 and over. That translates into earnings of $21.39 if you were only to deposit the minimum amount. Compare that to the average of all regular 6 month CDs, at 0.60%.

on CommunityWide Federal Credit Union’s secure website

1-Year IRA CD Rates – Connexus Credit Union, 1 Year IRA (Traditional, Roth, CESA)

12 Month Certificate from Connexus Credit Union
Regular one-year CDs earn an average interest rate of 0.95% APY. Connexus Credit Union, however, is offering a one-year IRA CD at 2.50% APY. You’ll need a $5,000 minimum deposit to earn $125.00 in interest once the CD matures.

LEARN MORE Secured

on Connexus Credit Union’s secure website

 

18-Month IRA CD Rates – Interior Federal Credit Union, 18 Month IRA Certificate (Traditional, Roth, CESA)

18-month regular CDs earn an average interest rate of 1.17% APY. Interior Federal Credit Union on the other hand, is currently offering 2.68% APY on an 18-month IRA CD. This would translate into earnings of $20.23 with a minimum $500 deposit.

on Interior Credit Union’s secure website

2-Year IRA CD Rates – CommunityWide Federal Credit Union, 24 Month IRA (Traditional, Roth)

60 Month IRA from Communitywide Federal Credit Union
Two-year regular CDs earn an average interest rate of 1.26% APY. CommunityWide Federal Credit Union, on the other hand, is currently offering 2.90% APY on a 2-year IRA CD. This would translate into earnings of $117.68 with a minimum $2,000 deposit.

on CommunityWide Federal Credit Union’s secure website

3-Year IRA CD Rates – Salem Five, 36 Month IRA Special (Traditional, Roth, CESA, SEP)

36 Month IRA Special from Salem Five
Three-year regular CDs are earning an average interest rate of 1.47% APY currently. Salem Five is exceeding that, with an interest rate of 3.00% APY with their 36-month IRA CD. With those interest rates and a $2,000 minimum deposit, you would earn $185.45 when the certificate matures.

LEARN MORE Secured

on Salem Five’s secure website

4-Year IRA CD Rates – CommunityWide Federal Credit Union, 48 Month Personal IRA

60 Month IRA from Communitywide Federal Credit UnionFour-year regular CDs are currently earning an average interest rate of 1.62% APY. CommunityWide Federal Credit Union claims the top interest rate for these IRA CDs, with an interest rate of 3.20% APY. You would earn $268.55 on this CD with a $2,000 minimum deposit.

on CommunityWide Federal Credit Union’s secure website

5-Year IRA CD Rates – Achieva Credit Union – 60 Month IRA/457B (Traditional, Roth, CESA)

Five-year IRA CDs hold the top spot for interest rates out of any category on our list. National averages for a regular 5-year CD is 1.92% APY, however Achieva Credit Union outperforms the average with a 4.00% APY on its 5-year IRA CD for members. The minimum deposit is $500 to earn this APY. If you’re able to deposit more than $500, you may eligible for a higher APY. With a deposit of $25,000 you may be able to earn an APY of 4.10%. If you’re able to deposit $75,000, you may be able to earn 4.20% APY.

One item to note with this credit union: the rates may vary by region, so make sure you check to make sure you’re eligible for the above rates in your location.

on Achieva Credit Union’s secure website

6+ Year IRA CD Rates – Air Force Federal Credit Union, 7 Year IRA (Traditional, Roth, CESA)

1 Year CD from AFFCU

We’re starting to see these very-long-term IRA CDs offer higher interest rates than the shorter-term five-year IRA CDs. Air Force Federal Credit Union offers the highest term for their seven-year IRA CD, at 3.20% APY. That’s less than Achieva Credit Union which offers a 4.00% APY for a five-year IRA CD. Still, with Air Force Federal Credit Union’s seven-year IRA CD, you would earn $616.72 on a minimum deposit of $2,500 when the IRA CD matures.

LEARN MORE Secured

on AFFCU’s secure website

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 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 card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Lindsay VanSomeren
Lindsay VanSomeren |

Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here

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Earning Interest

Top Jumbo CD Rates for July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Jumbo CD rates
iStock

In the banking world, CD stands for certificate of deposit. This is a type of savings account where you agree to put a certain amount of money in for a set period of time. In return, the bank agrees to pay you interest. You may have to pay early-withdrawal penalties if you access your money before the CD term ends.

There is a type of CD called a jumbo CD, in which you generally have to put in a minimum deposit of $100,000. Sometimes these jumbo CDs have higher interest rates than CDs where you deposit less than $100,000.

Best CD Rate Currently Available: Synchrony Bank USA – 12-Month CD – 2.40% APY

Synchrony Bank is currently offering one of the highest CD rates available on a 12-month CD. While this CD is technically not a jumbo CD, it offers a rate that is too good to pass up at a lower minimum deposit than a jumbo CD. You can earn the 2.40% APY with a minimum of $2,000 and lock in that rate for the duration of the term once the account is funded.

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

Your deposit is FDIC-insured up to the maximum limit.

The top jumbo CD rates

To compile a list of the top jumbo CD rates, we used information from DepositAccounts.com, which, like MagnifyMoney, is a LendingTree company. We sorted products by APY. Then, we excluded any institutions with a health rating below a B, as well as any credit unions with very restrictive membership requirements. If there was a tie between APYs, we chose the CD with a minimum deposit of $100,000. All products on this list are insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA), but with jumbo CDs, it’s especially important to remember that only deposits up to $250,000 are insured.

Keep in mind that other banks might offer a CD with a better APY and a lower minimum deposit than $100,000. However, the chart below reflects the true definition of a jumbo CD, which involves a deposit of $100,000 or more.

This table is updated as of June 8, 2018, but it’s always a good idea to double-check the annual percentage yield (APY) before making your choice of where to invest. Some banks on the list offer promotional APYs, so be sure to check that the rates below are still available since rates can change day to day.

Institution

CD Term

APY

Minimum Deposit Amount

M.Y. Safra Bank

3 months

1.15%

$100,000

My eBanc

6 months

1.85%

$100,000

KS StateBank

1 year

2.40%

$100,000

KS StateBank

18 months

2.55%

$100,000

KS StateBank

2 years

2.80%

$100,000

KS StateBank

3 years

2.95%

$100,000

KS StateBank

4 years

3.10%

$100,000

KS StateBank

5 years

3.25%

$100,000

As of July 12, 2018

Banks that offer the best jumbo CD rates

M.Y. Safra Bank

M.Y. Safra Bank
M.Y. Safra Bank holds three spots on this list. When you go to its homepage, you’ll notice the banner shows “Special CD Offers.” This means that it’s important to keep track of these interest rates to make sure you get one that is current. This page has asterisks next to online promotions, so you know which ones might not be offered for a long time.

One downside to M.Y. Safra Bank is that the website is hard to navigate and is slow to load. This could be difficult for sophisticated investors who are used to banking with ease.

For a three-month jumbo CD, the APY is 1.15%. Keep in mind there might be other banks that offer 35- or 38-month CDs for slightly better rates, but they were not factored into this chart since this category was specifically for a three-year offering.

LEARN MORE  Secured

on M.Y. Safra Bank’s secure website

My eBanc

My eBanc
My eBanc is an online-only bank. It’s a division of BAC Florida Bank. Unlike M.Y. Safra Bank’s, the eBanc website is much easier to navigate and has clear instructions on how to open a jumbo CD.

According to the site, My eBanc has no maintenance fees and compounds interest daily. When your jumbo CD matures, withdrawing your money is simple, although there is an early-withdrawal fee.

For a six-month jumbo CD, their APY is 1.85%.

LEARN MORE Secured

on My EBanc’s secure website

KS StateBank

KS StateBank

KS StateBank currently has internet-only specials on their 1, 1.5, 2, 3, 4, and 5-year jumbo CDs. This month the bank has truly outstanding rates on all of their terms.

Although KS StateBank is mainly located in Kansas, they do have the option to bank online or through their mobile banking app. This allows them to reach customers nationwide.

LEARN MORE Secured

on KS StateBank’s secure website

The difference between jumbo and regular CDs

As mentioned previously, you can open a CD with less than $100,000. You can even get CD rates comparable to the ones above, with a lower minimum deposit requirement. Of course, the more money you put in a CD, the more interest you can earn, but if you don’t have $100,000 to open a jumbo CD, it’s important to know you do have other options with lower minimums.

Withdrawal penalties on jumbo CDs

According to a recent survey, the penalties for withdrawing your money from your CD early could be serious. Some banks will even take part of your principal as a penalty.

Below are the most common penalties, according to the survey:

  • 3 month CD: Three months of interest
  • 6 month CD: Three months of interest
  • 1 year CD: Six months of interest
  • 2 year CD: Six months of interest
  • 5 year CD: A year’s worth of interest

So, it’s important to be confident that you want to put your money in a CD. When you do this, you’re making an agreement with the bank to leave it there for a set period of time. If you’re unsure if you want to tie up your money for a long period of time, consider a high-yield savings account instead.

How jumbo CDs are taxed

It’s important to know that the interest you earn on your jumbo CD will be taxed as interest income, not as capital gains income.

This means that your bank or credit union will send you a 1099-INT form at the end of the year to show how much interest you earned in your jumbo CD and you will be taxed on that.

Are jumbo CDs safe?

According to the U.S. Securities and Exchange Commission: “Certificates of deposit are considered to be one of the safest savings options. A CD bought through a federally insured bank is insured up to $250,000.”

Some people prefer investing in the stock market over CDs because you can often get higher rates of returns; however, the stock market is a riskier bet, and returns are not guaranteed like those associated with CDs.

CDs are not affected by the whims of the stock market. The interest rate you agree on with your bank is the rate you will get. That interest rate, however, may not outpace inflation, meaning you may not really earn much, if anything, over time.

Final thoughts

If you have over $100,000 and want to invest it in a jumbo CD, you have several options. Like the chart above shows, you can choose many different terms and durations for your jumbo CD. Just be sure to research the bank you invest with so you know you’re putting your money with a top-rated institution. Also, be sure that you’re comfortable with putting your money in a CD long-term because there are often penalties for withdrawing your money early.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Cat Alford
Cat Alford |

Cat Alford is a writer at MagnifyMoney. You can email Catherine at cat@magnifymoney.com

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The Top 6 Month CD Rates for July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

The top 6 month CD rates
Source: iStock

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 pulled these rates on July 11, 2018, and we excluded promotional offerings. The national average APY on 6 month CDs (among banks and credit unions) is 0.57%, 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

CD Bank

6 month CD APY: 2.10%
Bank information: A subsidiary of TBK Bank, SSB, this online bank has no branch locations, but offers service online in all 50 states.
Where to open CD account: Online
Minimum balance to open: $10,000
Maintenance fees: $0
Early withdrawal penalties: 90 days’ interest

State Bank of India

State Bank of India

6 month CD APY: 2.07%
Bank information: State Bank of India originated in India, but opened a branch in New York in 1970. Today, they have over 22,000 branches across 36 countries and an online platform that allows them to reach customers worldwide.
Where to open CD account: Online
Minimum balance to open: $5,000
Maintenance fees: $0
Early withdrawal penalties: 30 days’ interest

LEARN MORE Secured

on State Bank Of India’s secure website

6-Month CD from Limelight Bank

Limelight Bank

6 month CD APY: 2.05%
Bank information: Although Limelight Bank is located in Utah, they are an online bank that serves customers nationwide. They are environmentally conscious and originate loans for solar projects from customers’ various deposit accounts.
Where to open CD account: Online
Minimum balance to open: $1,000
Maintenance fees: $0
Early withdrawal penalties: Determined by bank.

LEARN MORE Secured

on Limelight Bank’s secure website

6 Month Popular Direct CD from Popular Direct

Popular Direct

6 month CD APY: 2.05%
Bank information: Popular Direct is an online bank that services customers in the U.S., Puerto Rico, and throughout the Caribbean. They currently have some of the most competitive rates in the market – not only in their CD products, but with their savings account as well.
Where to open CD account: Online
Minimum balance to open: $10,000
Maintenance fees: $0
Early withdrawal penalties: 120 days of simple interest

LEARN MORE Secured

on Popular Direct’s secure website

Member FDIC

North American Savings Bank

6 month CD APY: 2.02%
Bank information: North American Savings Bank (NASB) is headquartered in Missouri and was founded in 1927. They were founded on two principles: strength and security. Today, in the online banking world, security is more important than ever and NASB strives to provide a safe and secure place for deposits.
Where to open CD account: Online
Minimum balance to open: $5,000
Maintenance fees: $0
Early withdrawal penalties: Determined by bank

on North American Savings Bank’s secure website
 

Member FDIC

Credit unions with the best 6 month CD rates

36 Month Share Certificate from Communitywide Federal Credit Union

CommunityWide Federal Credit Union

6 month CD APY: 2.15%
Credit union information: Founded as a credit union to provide quality financial services to individuals in South Bend, IN, CommunityWide Federal  Credit Union has grown to offer their services to various communities within Indiana as well as the digital world.
Membership details: Anyone can become a member by donating to a list of organizations including the Y.M.C.A. If you’re a member of the Michiana Goodwill Boosters or Marine Corps. League of St. Joseph Valley, you’re also eligible to become a member.
Where to open CD account: Online
Minimum balance to open: $2,000
Maintenance fees: $0
Early withdrawal penalties: Equal to the amount withdrawn multiplied by the remaining days left in the term.

on CommunityWide Federal Credit Union’s secure website
 

6 Month Share Certificate from Service Credit Union

Service Credit Union

6 month CD APY: 2.00%
Credit union information: Founded in Portsmouth, N.H., in 1957, Service Credit Union originally served employees of Pease Air Force Base. Today, it has grown to serve over 200,000 people throughout New Hampshire, North Dakota, Massachusetts, and even Germany.
Membership details: To become a member, you must live or work, or have family members that live or work in New Hampshire or Falmouth, Bourne, Mashpee, and Sandwich, Mass. Current members of the military, veterans, retirees, and reservists of the U.S. Armed Forces along with their families are also eligible for membership.
Where to open CD account: You can open an account online or at one of their many branches.
Minimum balance to open: $250
Maintenance fees: $0
Early withdrawal penalties: Determined by credit union.

LEARN MORE Secured

on Service Credit Union’s secure website

PenFed Credit Union

PenFed Credit Union

6 month CD APY: 1.85%
Credit union information: PenFed, established in 1935, today serves more than 1.6 million members at branch locations in all 50 states and select overseas facilities.
Membership details: Open to current or retired members of the U.S. military, federal employees, affinity partners, members of qualifying organizations, or by donating to Voices for America’s Troops or the National Military Family Association.
Where to open CD account: You can open an account online or at one of their branches.
Minimum balance to open: $1,000
Maintenance fees: $0
Early withdrawal penalties: 90 days’ interest

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

Spectrum Credit Union

Spectrum Credit Union

6 month CD APY: 1.65%
Credit union information: Spectrum Credit Union was founded in 1973. This credit union is a division of Chevron Federal Credit Union and serves members worldwide through their online banking platform.
Membership details: If you don’t qualify by one of their location or employment field of membership requirements, you may apply for membership by joining one of their non-profit partners: Contra Costa Country Historical Society or Navy League of the United States.
Where to open CD account: Online
Minimum balance to open: $500
Maintenance fees: $0
Early withdrawal penalties: Equal to three months of dividends.

 

LEAEN MORE Secured

on Spectrum Credit Union’s secure website

Latino Credit Union

Latino Credit Union

6 month CD APY: 1.55%
Credit union information: Founded in Durham, N.C., in 2000, Latino Credit Union opened its doors as a solution to the Durham Latino community who were being robbed and mugged. While their original intent was to serve the Latino community, they have since expanded their membership to include anyone and everyone.
Membership details: Anyone who is willing to provide a one-time $10 donation to the Latino Community Development Center is welcome to become a member of the credit union.
Where to open CD account: Online
Minimum balance to open: $500
Maintenance fees: $0
Early withdrawal penalties: 90 days’ interest

LEARN MORE Secured

on Latino Credit Union’s secure website

Pros and cons of using 6 month CDs

Pros:

  • 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.)

Cons:

  • 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.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Gabby Hyman
Gabby Hyman |

Gabby Hyman is a writer at MagnifyMoney. You can email Gabby here

TAGS: ,

Advertiser Disclosure

Earning Interest

The Best CD Rates – July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

The Best CD Rates
iStock

Updated June 29, 2018

If you are looking for a better yield on your savings, a high rate CD (certificate of deposit) offered by an online bank could be a good option. Internet-only banks offer much better interest rates than traditional banks. For example, a 12-month CD at Bank of America would require a $10,000 minimum deposit and would pay only 0.07%. At an online bank, you could earn 2.25% with no minimum deposit. (If you would rather get a savings account or money market with no time restriction, look at the best savings accounts or best money market accounts).

The Best CD Rates in July 2018

This list is updated monthly, and competition continues to intensify. Here are the accounts with some of the best CD rates:

Term

Institution

APY

Minimum Deposit Amount

 

1 year

Goldman Sachs Bank USA

2.30%

$500

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

2 years

Sallie Mae

2.80%

$2,500

3 years

PurePoint Financial

3.00%

$10,000

LEARN MORE 

Member FDIC

5 years

Connexus Credit Union

3.25%

$5,000

LEARN MORE Secured

on Connexus Credit Union’s secure website

See a full list of the best CD rates below.

  • 6 months – 6 years: Goldman Sachs Bank USA – 0.60% APY – 3.10% APY; $500 minimum deposit

Goldman Sachs Bank USA
Our advertiser Marcus by Goldman Sachs is the online consumer bank of Goldman Sachs Bank USA (the large investment bank). Your funds are FDIC insured, and Goldman offers very competitive rates. Even better: there is only a $500 minimum deposit. So, if you don’t have enough money to meet the minimum deposit of the other banks on this list, or you are looking for another bank for your savings, GS is a good option. It also doesn’t hurt that they also offer some of the best CD rates in the market today. Here are their rates:

  • 6-month: 0.60% APY
  • 9-month: 0.70% APY
  • 12-month: 2.30% APY
  • 18-month: 2.35% APY
  • 2-year: 2.45% APY
  • 3-year: 2.55% APY
  • 5-year: 3.00% APY
  • 6-year: 3.10% APY

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

  • 3 months – 5 years: Ally Bank – 0.75% APY – 2.75% APY; $0 minimum deposit (higher APY with higher deposit)

Ally Bank
Ally is one of the largest internet-only banks in the country. Ally’s former advertising campaign made it very clear: no branches = higher rates. And Ally has consistently paid some of the highest rates in the country across savings accounts, money market accounts and CDs. For savers with fewer funds, Ally is unique. There is no minimum deposit to open a CD. However, if you have more money, you can earn a higher APY. If you have more than $25,000 to deposit, you can earn between 1.50% APY and 2.75% APY. And one of our favorite features of Ally: they often (although not always) offer preferential rates on renewal. Far too often banks give the biggest bonuses to new customers, but Ally has done a good job of rewarding its existing customers. All deposits at Ally are FDIC insured up to the legal limit.

  • 3-months: 0.75% APY (less than $5k); 0.75% APY ($5k minimum deposit) and 0.75% APY ($25k minimum deposit)
  • 6-months: 1.00% APY (less than $5k); 1.00% APY ($5k minimum deposit) and 1.00% APY ($25k minimum deposit)
  • 9-months: 1.25% APY (less than $5k); 1.25% APY ($5k minimum deposit) and 1.25% APY ($25k minimum deposit)
  • 12-months: 2.10% APY (less than $5k); 2.20% APY ($5k minimum deposit) and 2.30% APY ($25k minimum deposit)
  • 18-months: 2.15% APY (less than $5k); 2.25% APY ($5k minimum deposit) and 2.35% APY ($25k minimum deposit)
  • 3-year: 2.50% APY (less than $5k); 2.55% APY ($5k minimum deposit) and 2.55% APY ($25k minimum deposit)
  • 5-year: 2.50% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.75% APY ($25k minimum deposit)

LEARN MORE Secured

on Ally Bank’s secure website

Member FDIC

  • 3 months – 5 years: Synchrony Bank – 0.75% APY – 2.85% APY; $2,000 minimum deposit

Synchrony Bank
Synchrony used to be a part of GE, and now has an online bank that pays competitive rates. The online deposits are used to fund their store credit card portfolio – and the company is publicly traded. Your deposit will be insured up to the FDIC limit. In a rising rate environment, this is a great way to get a high interest rate without locking yourself into a long term.

  • 3-months: 0.75% APY
  • 6-months: 1.00 % APY
  • 9-months: 1.25% APY
  • 12-months: 2.25% APY
  • 14-months: 2.45% APY
  • 18-months: 2.35% APY
  • 24-months: 2.45% APY
  • 36-months: 2.55% APY
  • 48-months: 2.65% APY
  • 60-months: 2.85% APY

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

  • 1 year – 5 years: Barclays Bank – 2.25% – 2.85% APY, no minimum deposit

12 Month Online CD from Barclays Barclays is one of the oldest banks in the world. Although they’re based in London, they do have a U.S. presence and offer competitive rates on their CDs and savings account. Currently, they’re offering some of the highest CD rates in the market, and they have an edge over the rest of the institutions on this list: they don’t require a minimum balance to earn the APY or open an account. Deposit as little or as much as you’d like into a term of your choice and you can start earning interest as long as the account is funded within 14 days of opening the CD. Additionally, your funds are insured through the FDIC.

  • 1-year: 2.25% APY
  • 2-year: 2.45% APY
  • 3-year: 2.55% APY
  • 4-year: 2.65% APY
  • 5-year: 2.85% APY

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

  • 1-Year CD from a Credit Union: PenFed Credit Union – 2.25% APY, $1,000 minimum deposit

12 Month Money Market Certificate from PenFed Credit UnionPenFed is a credit union that offers very competitive interest rates. You need to join the credit union in order to benefit from their products. If you have a military or government affiliation, it is free to join. Otherwise, you would need to join an organization like Voices for America’s Troops, which costs $17.00. Once you are a member, you can open PenFed products (including this certificate) online. Your deposit would be insured by the NCUA, which is the National Credit Union Administration. There is a $1,000 minimum deposit for the one-year certificate.

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

  • 12-Month CD: Banesco USA – 2.35% APY, No minimum deposit

12 Month CD from Banesco USABanesco USA is based out of Florida, but has an international presence. Established in 2006, they have quickly grown to procure over $1 billion in assets. They’re currently offering one of the highest CD rates available. With $1,500 minimum deposit amount, you can earn a 2.35% APY on a 12-month CD.

LEARN MORE Secured

on Banesco USA’s secure website

  • 2-Year CD: PurePoint Financial – 2.75% APY, $10,000 minimum deposit

24 Month Online CD from PurePoint Financial
PurePoint Financial is new to our list this month. Despite having a high deposit amount of $10,000, they have one of the highest rates on a 24-month CD. PurePoint Financial is a division of MUFG Union Bank, N.A. Both are backed by Mitsubishi UFJ Financial Group, which is the fifth largest financial group in the world. PurePoint Financial is offering some of the most competitive rates, not only with their CDs, but also in their online savings account. With their CDs, they have a Best Rate Commitment, which means that if you fund the account within 10 days of submitting the application, they will make sure that you receive the best rate during that time period. In an ever-increasing rate environment, that’s a pretty good promise. While they mainly function as online-only bank, they don’t currently have a mobile app.

LEARN MORE Secured

on PurePoint Financial’s secure website

Member FDIC

  • 2-Year CD from a Credit Union: Greenwood Credit Union – 2.80% APY, $1,000 minimum deposit

Greenwood Credit Union
Greenwood Credit Union is open to anyone and everyone. The only requirement to become a member with this credit union is to open their Share Savings Account with a minimum deposit amount of $5. You’ll also have to maintain that amount in the account to remain an active member. When you go to apply for membership, you can also add that you want to open their 24 month CD. You’ll need to deposit $1,000 in order to earn their outstanding 2.80% APY. This deposit will be in addition to the $5 to open the Share Savings Account. Accounts can be managed online or through their mobile app. Deposits made to Greenwood Credit Union are insured by the NCUA.

LEARN MORE Secured

on Greenwood Credit Union’s secure website

 

  • 3-Year CD: PurePoint Financial – 3.00% APY, $10,000 minimum deposit

36 Month Online CD from PurePoint Financial
PurePoint Financial lands a second spot on our list by offering an incredible 3.00% APY on a 36-month CD. You’ll still need a minimum deposit amount of $10,000 to open this account. Like the 24-month CD, PurePoint Financial commits to providing the best rate for this term if the account is funded within 10 days of completing the application.

LEARN MORE Secured

on PurePoint Financial’s secure website

Member FDIC

  • 3-Year CD from a Credit Union: Veridian Credit Union, 2.75% APY, $1,000 minimum deposit

18-24 Month CD from Veridian Credit UnionVeridian Credit Union was established in 1934 by employees of John Deere. According to Veridian Credit Union’s history, the employees wanted to provide alternatives to for-profit institutions for their coworkers. Today, Veridian operates similarly even though they’ve expanded their field of membership to include almost anyone by allowing applicants to register as a user of Dwolla if they’re not eligible any other way. Once you become a member, you can open a 36-month CD with a minimum of $1,000. This account earns an APY of 2.75%. Veridian Credit Union allows you to manage your account online as well as through their mobile app.

LEARN MORE Secured

on Veridian Credit Union’s secure website

  • 5-Year CD: M.Y. Safra Bank – 3.06% APY, $5,000 minimum deposit

3 Month Online Promo (New Money) from M.Y. Safra BankM.Y. Safra Bank, located in New York, NY, was established in 2000. They currently have over $368 million in assets. Their 5-year CD has an APY of 3.06%, which is one of the highest currently available. You’ll need $5,000 to deposit to open the account and a little patience navigating their website. While they do have a mobile app, you’ll have to first apply for an account online.

LEARN MORE Secured

on M.Y. Safra Bank’s secure website

Member FDIC

  • 5-Year CD from a Credit Union: Connexus Credit Union – 3.25% APY, $5,000 minimum deposit

60 Month Certificate from Connexus Credit UnionIf you’re able to deposit $5,000 into a CD, you’ll want to consider this 5-year CD with an incredible 3.25% APY. Anyone is able to join the credit union by making a donation of $5 to their organization called Connexus Association. This organization provides scholarships and assists educational institutions. They have a mobile banking app as well as an online banking platform.

LEARN MORE Secured

on Connexus Credit Union’s secure website

3 Questions To Ask Before You Open A CD

1. Should I just open an online savings account instead?

With a CD, the saver and the bank make stronger commitments. The saver promises to keep the funds in the account for a specified period of time. In exchange, the bank guarantees the interest rate during the term of the CD. The longer the term, the higher the interest rate – and the higher the penalty for closing the CD early. With a savings account, there are few promises. You can empty the account without paying a penalty and the bank can change the interest rate at any time.

If you have a high level of confidence that you do not need to touch the money for a specified period of time, a CD is a much better deal. However, if you think you might need to use the money in the next couple of months, a savings account is a much better idea.

You can earn a lot more interest with a CD. Imagine you have $10,000 and know that you do not need to touch the money for two years. In a high-yield savings account earning 1.60%, you would earn $322.56 over two years. If you put that money into a 2.51% CD, you would earn $508.30. Given the ease of switching to an online CD, the extra interest income is easy money.

2. What term should I select?

The early withdrawal penalties on CDs can be significant. On a 1-year CD, 90 days is a typical penalty. And on 2 and 3 year CDs, a 6-month penalty is common. The impact of the penalty on your return can be significant. If you opened a one-year CD with a 2.20% APY and closed it after six months, you would forfeit half of the interest and earned only 1.11%. You would have been better off with a savings account paying 1.60%.

The worst case scenario is with the longest CDs. 5-year CDs usually have a one-year penalty for taking out funds early. If you open a 5-year CD and close it quickly, you could actually end up losing money.

Given the early penalties, you need complete confidence that you will not need to withdrawal the money early. Ask yourself this question: “do I have 90% confidence that I will not need access to the cash during the CD term?” If you don’t have confidence, go for a shorter term or a savings account.

3. Should I consider my local bank or credit union?

The interest rates shown in this article are all from online banks that offer products nationally. Our product database includes traditional banks, community banks and credit unions. If traditional banks offered better rates, they would have been featured in this article. The internet-only banks have dramatically better interest rates. That should not be surprising. Because internet-only banks do not have branches, they are able to pass along their cost savings to you in the form of higher interest rates.

However, you can always visit your local bank or credit union and ask them to beat the rates listed in this article. The chance of getting a better deal is extremely low (remember that Bank of America is only paying 0.07%), but you can try.

How To Find The Best Account

If you don’t find an account that meets your needs in this article, you can use the MagnifyMoney CD tool to find the best rate for your individual needs. Input your zip code, deposit amount and term. The tool will then provide you with CD options, from the highest APY to the lowest.

You can learn more about us and how we make money here.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Nick Clements
Nick Clements |

Nick Clements is a writer at MagnifyMoney. You can email Nick at nick@magnifymoney.com

TAGS:

Advertiser Disclosure

Earning Interest

The Best CD Rates – July 2018

Editorial Note: The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

The Best CD Rates
iStock

Updated June 29, 2018

If you are looking for a better yield on your savings, a high rate CD (certificate of deposit) offered by an online bank could be a good option. Internet-only banks offer much better interest rates than traditional banks. For example, a 12-month CD at Bank of America would require a $10,000 minimum deposit and would pay only 0.07%. At an online bank, you could earn 2.25% with no minimum deposit. (If you would rather get a savings account or money market with no time restriction, look at the best savings accounts or best money market accounts).

The Best CD Rates in July 2018

This list is updated monthly, and competition continues to intensify. Here are the accounts with some of the best CD rates:

Term

Institution

APY

Minimum Deposit Amount

 

1 year

Goldman Sachs Bank USA

2.30%

$500

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

2 years

Sallie Mae

2.80%

$2,500

3 years

PurePoint Financial

3.00%

$10,000

LEARN MORE 

Member FDIC

5 years

Connexus Credit Union

3.25%

$5,000

LEARN MORE Secured

on Connexus Credit Union’s secure website

See a full list of the best CD rates below.

  • 6 months – 6 years: Goldman Sachs Bank USA – 0.60% APY – 3.10% APY; $500 minimum deposit

Goldman Sachs Bank USA
Our advertiser Marcus by Goldman Sachs is the online consumer bank of Goldman Sachs Bank USA (the large investment bank). Your funds are FDIC insured, and Goldman offers very competitive rates. Even better: there is only a $500 minimum deposit. So, if you don’t have enough money to meet the minimum deposit of the other banks on this list, or you are looking for another bank for your savings, GS is a good option. It also doesn’t hurt that they also offer some of the best CD rates in the market today. Here are their rates:

  • 6-month: 0.60% APY
  • 9-month: 0.70% APY
  • 12-month: 2.30% APY
  • 18-month: 2.35% APY
  • 2-year: 2.45% APY
  • 3-year: 2.55% APY
  • 5-year: 3.00% APY
  • 6-year: 3.10% APY

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

  • 3 months – 5 years: Ally Bank – 0.75% APY – 2.75% APY; $0 minimum deposit (higher APY with higher deposit)

Ally Bank
Ally is one of the largest internet-only banks in the country. Ally’s former advertising campaign made it very clear: no branches = higher rates. And Ally has consistently paid some of the highest rates in the country across savings accounts, money market accounts and CDs. For savers with fewer funds, Ally is unique. There is no minimum deposit to open a CD. However, if you have more money, you can earn a higher APY. If you have more than $25,000 to deposit, you can earn between 1.50% APY and 2.75% APY. And one of our favorite features of Ally: they often (although not always) offer preferential rates on renewal. Far too often banks give the biggest bonuses to new customers, but Ally has done a good job of rewarding its existing customers. All deposits at Ally are FDIC insured up to the legal limit.

  • 3-months: 0.75% APY (less than $5k); 0.75% APY ($5k minimum deposit) and 0.75% APY ($25k minimum deposit)
  • 6-months: 1.00% APY (less than $5k); 1.00% APY ($5k minimum deposit) and 1.00% APY ($25k minimum deposit)
  • 9-months: 1.25% APY (less than $5k); 1.25% APY ($5k minimum deposit) and 1.25% APY ($25k minimum deposit)
  • 12-months: 2.10% APY (less than $5k); 2.20% APY ($5k minimum deposit) and 2.30% APY ($25k minimum deposit)
  • 18-months: 2.15% APY (less than $5k); 2.25% APY ($5k minimum deposit) and 2.35% APY ($25k minimum deposit)
  • 3-year: 2.50% APY (less than $5k); 2.55% APY ($5k minimum deposit) and 2.55% APY ($25k minimum deposit)
  • 5-year: 2.50% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.75% APY ($25k minimum deposit)

LEARN MORE Secured

on Ally Bank’s secure website

Member FDIC

  • 3 months – 5 years: Synchrony Bank – 0.75% APY – 2.85% APY; $2,000 minimum deposit

Synchrony Bank
Synchrony used to be a part of GE, and now has an online bank that pays competitive rates. The online deposits are used to fund their store credit card portfolio – and the company is publicly traded. Your deposit will be insured up to the FDIC limit. In a rising rate environment, this is a great way to get a high interest rate without locking yourself into a long term.

  • 3-months: 0.75% APY
  • 6-months: 1.00 % APY
  • 9-months: 1.25% APY
  • 12-months: 2.25% APY
  • 14-months: 2.45% APY
  • 18-months: 2.35% APY
  • 24-months: 2.45% APY
  • 36-months: 2.55% APY
  • 48-months: 2.65% APY
  • 60-months: 2.85% APY

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

  • 1 year – 5 years: Barclays Bank – 2.25% – 2.85% APY, no minimum deposit

12 Month Online CD from Barclays Barclays is one of the oldest banks in the world. Although they’re based in London, they do have a U.S. presence and offer competitive rates on their CDs and savings account. Currently, they’re offering some of the highest CD rates in the market, and they have an edge over the rest of the institutions on this list: they don’t require a minimum balance to earn the APY or open an account. Deposit as little or as much as you’d like into a term of your choice and you can start earning interest as long as the account is funded within 14 days of opening the CD. Additionally, your funds are insured through the FDIC.

  • 1-year: 2.25% APY
  • 2-year: 2.45% APY
  • 3-year: 2.55% APY
  • 4-year: 2.65% APY
  • 5-year: 2.85% APY

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

  • 1-Year CD from a Credit Union: PenFed Credit Union – 2.25% APY, $1,000 minimum deposit

12 Month Money Market Certificate from PenFed Credit UnionPenFed is a credit union that offers very competitive interest rates. You need to join the credit union in order to benefit from their products. If you have a military or government affiliation, it is free to join. Otherwise, you would need to join an organization like Voices for America’s Troops, which costs $17.00. Once you are a member, you can open PenFed products (including this certificate) online. Your deposit would be insured by the NCUA, which is the National Credit Union Administration. There is a $1,000 minimum deposit for the one-year certificate.

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

  • 12-Month CD: Banesco USA – 2.35% APY, No minimum deposit

12 Month CD from Banesco USABanesco USA is based out of Florida, but has an international presence. Established in 2006, they have quickly grown to procure over $1 billion in assets. They’re currently offering one of the highest CD rates available. With $1,500 minimum deposit amount, you can earn a 2.35% APY on a 12-month CD.

LEARN MORE Secured

on Banesco USA’s secure website

  • 2-Year CD: PurePoint Financial – 2.75% APY, $10,000 minimum deposit

24 Month Online CD from PurePoint Financial
PurePoint Financial is new to our list this month. Despite having a high deposit amount of $10,000, they have one of the highest rates on a 24-month CD. PurePoint Financial is a division of MUFG Union Bank, N.A. Both are backed by Mitsubishi UFJ Financial Group, which is the fifth largest financial group in the world. PurePoint Financial is offering some of the most competitive rates, not only with their CDs, but also in their online savings account. With their CDs, they have a Best Rate Commitment, which means that if you fund the account within 10 days of submitting the application, they will make sure that you receive the best rate during that time period. In an ever-increasing rate environment, that’s a pretty good promise. While they mainly function as online-only bank, they don’t currently have a mobile app.

LEARN MORE Secured

on PurePoint Financial’s secure website

Member FDIC

  • 2-Year CD from a Credit Union: Greenwood Credit Union – 2.80% APY, $1,000 minimum deposit

Greenwood Credit Union
Greenwood Credit Union is open to anyone and everyone. The only requirement to become a member with this credit union is to open their Share Savings Account with a minimum deposit amount of $5. You’ll also have to maintain that amount in the account to remain an active member. When you go to apply for membership, you can also add that you want to open their 24 month CD. You’ll need to deposit $1,000 in order to earn their outstanding 2.80% APY. This deposit will be in addition to the $5 to open the Share Savings Account. Accounts can be managed online or through their mobile app. Deposits made to Greenwood Credit Union are insured by the NCUA.

LEARN MORE Secured

on Greenwood Credit Union’s secure website

 

  • 3-Year CD: PurePoint Financial – 3.00% APY, $10,000 minimum deposit

36 Month Online CD from PurePoint Financial
PurePoint Financial lands a second spot on our list by offering an incredible 3.00% APY on a 36-month CD. You’ll still need a minimum deposit amount of $10,000 to open this account. Like the 24-month CD, PurePoint Financial commits to providing the best rate for this term if the account is funded within 10 days of completing the application.

LEARN MORE Secured

on PurePoint Financial’s secure website

Member FDIC

  • 3-Year CD from a Credit Union: Veridian Credit Union, 2.75% APY, $1,000 minimum deposit

18-24 Month CD from Veridian Credit UnionVeridian Credit Union was established in 1934 by employees of John Deere. According to Veridian Credit Union’s history, the employees wanted to provide alternatives to for-profit institutions for their coworkers. Today, Veridian operates similarly even though they’ve expanded their field of membership to include almost anyone by allowing applicants to register as a user of Dwolla if they’re not eligible any other way. Once you become a member, you can open a 36-month CD with a minimum of $1,000. This account earns an APY of 2.75%. Veridian Credit Union allows you to manage your account online as well as through their mobile app.

LEARN MORE Secured

on Veridian Credit Union’s secure website

  • 5-Year CD: M.Y. Safra Bank – 3.06% APY, $5,000 minimum deposit

3 Month Online Promo (New Money) from M.Y. Safra BankM.Y. Safra Bank, located in New York, NY, was established in 2000. They currently have over $368 million in assets. Their 5-year CD has an APY of 3.06%, which is one of the highest currently available. You’ll need $5,000 to deposit to open the account and a little patience navigating their website. While they do have a mobile app, you’ll have to first apply for an account online.

LEARN MORE Secured

on M.Y. Safra Bank’s secure website

Member FDIC

  • 5-Year CD from a Credit Union: Connexus Credit Union – 3.25% APY, $5,000 minimum deposit

60 Month Certificate from Connexus Credit UnionIf you’re able to deposit $5,000 into a CD, you’ll want to consider this 5-year CD with an incredible 3.25% APY. Anyone is able to join the credit union by making a donation of $5 to their organization called Connexus Association. This organization provides scholarships and assists educational institutions. They have a mobile banking app as well as an online banking platform.

LEARN MORE Secured

on Connexus Credit Union’s secure website

3 Questions To Ask Before You Open A CD

1. Should I just open an online savings account instead?

With a CD, the saver and the bank make stronger commitments. The saver promises to keep the funds in the account for a specified period of time. In exchange, the bank guarantees the interest rate during the term of the CD. The longer the term, the higher the interest rate – and the higher the penalty for closing the CD early. With a savings account, there are few promises. You can empty the account without paying a penalty and the bank can change the interest rate at any time.

If you have a high level of confidence that you do not need to touch the money for a specified period of time, a CD is a much better deal. However, if you think you might need to use the money in the next couple of months, a savings account is a much better idea.

You can earn a lot more interest with a CD. Imagine you have $10,000 and know that you do not need to touch the money for two years. In a high-yield savings account earning 1.60%, you would earn $322.56 over two years. If you put that money into a 2.51% CD, you would earn $508.30. Given the ease of switching to an online CD, the extra interest income is easy money.

2. What term should I select?

The early withdrawal penalties on CDs can be significant. On a 1-year CD, 90 days is a typical penalty. And on 2 and 3 year CDs, a 6-month penalty is common. The impact of the penalty on your return can be significant. If you opened a one-year CD with a 2.20% APY and closed it after six months, you would forfeit half of the interest and earned only 1.11%. You would have been better off with a savings account paying 1.60%.

The worst case scenario is with the longest CDs. 5-year CDs usually have a one-year penalty for taking out funds early. If you open a 5-year CD and close it quickly, you could actually end up losing money.

Given the early penalties, you need complete confidence that you will not need to withdrawal the money early. Ask yourself this question: “do I have 90% confidence that I will not need access to the cash during the CD term?” If you don’t have confidence, go for a shorter term or a savings account.

3. Should I consider my local bank or credit union?

The interest rates shown in this article are all from online banks that offer products nationally. Our product database includes traditional banks, community banks and credit unions. If traditional banks offered better rates, they would have been featured in this article. The internet-only banks have dramatically better interest rates. That should not be surprising. Because internet-only banks do not have branches, they are able to pass along their cost savings to you in the form of higher interest rates.

However, you can always visit your local bank or credit union and ask them to beat the rates listed in this article. The chance of getting a better deal is extremely low (remember that Bank of America is only paying 0.07%), but you can try.

How To Find The Best Account

If you don’t find an account that meets your needs in this article, you can use the MagnifyMoney CD tool to find the best rate for your individual needs. Input your zip code, deposit amount and term. The tool will then provide you with CD options, from the highest APY to the lowest.

You can learn more about us and how we make money here.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Nick Clements
Nick Clements |

Nick Clements is a writer at MagnifyMoney. You can email Nick at nick@magnifymoney.com

TAGS:

Advertiser Disclosure

Earning Interest

The Best CD Rates – July 2018

Any opinions, analyses, reviews or recommendations expressed in this articles are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by any lender or provider of the products listed.

The Best CD Rates
iStock

Updated July 10, 2018

If you are looking for a better yield on your savings, a high rate CD (certificate of deposit) offered by an online bank could be a good option. Internet-only banks offer much better interest rates than traditional banks. For example, a 12-month CD at Bank of America would require a $10,000 minimum deposit and would pay only 0.07%. At an online bank, you could earn 2.25% with no minimum deposit. (If you would rather get a savings account or money market with no time restriction, look at the best savings accounts or best money market accounts).

The Best CD Rates in July 2018

This list is updated monthly, and competition continues to intensify. Here are the accounts with some of the best CD rates:

Term

Institution

APY

Minimum Deposit Amount

1 year

Goldman Sachs Bank USA

2.30%

$500

2 years

Sallie Mae

2.80%

$2,500

3 years

PurePoint Financial

3.00%

$10,000

5 years

Connexus Credit Union

3.25%

$5,000

See a full list of the best CD rates below.

  • 6 months – 6 years: Goldman Sachs Bank USA – 0.60% APY – 3.10% APY; $500 minimum deposit

Goldman Sachs Bank USA
Our advertiser Marcus by Goldman Sachs is the online consumer bank of Goldman Sachs Bank USA (the large investment bank). Your funds are FDIC insured, and Goldman offers very competitive rates. Even better: there is only a $500 minimum deposit. So, if you don’t have enough money to meet the minimum deposit of the other banks on this list, or you are looking for another bank for your savings, GS is a good option. It also doesn’t hurt that they also offer some of the best CD rates in the market today. Here are their rates:

  • 6-month: 0.60% APY
  • 9-month: 0.70% APY
  • 12-month: 2.30% APY
  • 18-month: 2.35% APY
  • 2-year: 2.45% APY
  • 3-year: 2.55% APY
  • 5-year: 3.00% APY
  • 6-year: 3.10% APY

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

  • 3 months – 5 years: Ally Bank – 0.75% APY – 2.75% APY; $0 minimum deposit (higher APY with higher deposit)

Ally Bank
Ally is one of the largest internet-only banks in the country. Ally’s former advertising campaign made it very clear: no branches = higher rates. And Ally has consistently paid some of the highest rates in the country across savings accounts, money market accounts and CDs. For savers with fewer funds, Ally is unique. There is no minimum deposit to open a CD. However, if you have more money, you can earn a higher APY. If you have more than $25,000 to deposit, you can earn between 0.75% APY and 2.75% APY. And one of our favorite features of Ally: they often (although not always) offer preferential rates on renewal. Far too often banks give the biggest bonuses to new customers, but Ally has done a good job of rewarding its existing customers. All deposits at Ally are FDIC insured up to the legal limit.

  • 3-months: 0.75% APY (less than $5k); 0.75% APY ($5k minimum deposit) and 0.75% APY ($25k minimum deposit)
  • 6-months: 1.00% APY (less than $5k); 1.00% APY ($5k minimum deposit) and 1.00% APY ($25k minimum deposit)
  • 9-months: 1.25% APY (less than $5k); 1.25% APY ($5k minimum deposit) and 1.25% APY ($25k minimum deposit)
  • 12-months: 2.10% APY (less than $5k); 2.20% APY ($5k minimum deposit) and 2.30% APY ($25k minimum deposit)
  • 18-months: 2.15% APY (less than $5k); 2.25% APY ($5k minimum deposit) and 2.35% APY ($25k minimum deposit)
  • 3-year: 2.50% APY (less than $5k); 2.55% APY ($5k minimum deposit) and 2.55% APY ($25k minimum deposit)
  • 5-year: 2.50% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.75% APY ($25k minimum deposit)

LEARN MORE Secured

on Ally Bank’s secure website

Member FDIC

  • 3 months – 5 years: Synchrony Bank – 0.75% APY – 2.85% APY; $2,000 minimum deposit

Synchrony Bank
Synchrony used to be a part of GE, and now has an online bank that pays competitive rates. The online deposits are used to fund their store credit card portfolio – and the company is publicly traded. Your deposit will be insured up to the FDIC limit. In a rising rate environment, this is a great way to get a high interest rate without locking yourself into a long term.

  • 3-months: 0.75% APY
  • 6-months: 1.00% APY
  • 9-months: 1.25% APY
  • 12-months: 2.40% APY
  • 14-months: 2.45% APY
  • 18-months: 2.40% APY
  • 24-months: 2.50% APY
  • 36-months: 2.55% APY
  • 48-months: 2.65% APY
  • 60-months: 2.85% APY

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

  • 1 year – 5 years: Barclays Bank – 2.25% – 2.85% APY, no minimum deposit

12 Month Online CD from Barclays Barclays is one of the oldest banks in the world. Although they’re based in London, they do have a U.S. presence and offer competitive rates on their CDs and savings account. Currently, they’re offering some of the highest CD rates in the market, and they have an edge over the rest of the institutions on this list: they don’t require a minimum balance to earn the APY or open an account. Deposit as little or as much as you’d like into a term of your choice and you can start earning interest as long as the account is funded within 14 days of opening the CD. Additionally, your funds are insured through the FDIC.

  • 1-year: 2.25% APY
  • 2-year: 2.45% APY
  • 3-year: 2.55% APY
  • 4-year: 2.65% APY
  • 5-year: 2.85% APY

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

  • 1-Year CD from a Credit Union: PenFed Credit Union – 2.35% APY, $1,000 minimum deposit

12 Month Money Market Certificate from PenFed Credit UnionPenFed is a credit union that offers very competitive interest rates. You need to join the credit union in order to benefit from their products. If you have a military or government affiliation, it is free to join. Otherwise, you would need to join an organization like Voices for America’s Troops, which costs $17.00. Once you are a member, you can open PenFed products (including this certificate) online. Your deposit would be insured by the NCUA, which is the National Credit Union Administration. There is a $1,000 minimum deposit for the one-year certificate.

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

  • 12-Month CD: CIT Bank – 2.50% APY, $1,000 minimum deposit

1-Year Term CD from CIT BankCIT Bank is a bank subsidiary of the publicly traded financial holding company, CIT. Established in 2009, the bank has quickly grown to procure over $42 billion in assets. They’re currently offering one of the highest CD rates available. With $1,000 minimum deposit amount, you can earn a 2.50% APY on a 12-month CD.

LEARN MORE 

Member FDIC

  • 2-Year CD: Sallie Mae Bank – 2.80% APY, $2,500 minimum deposit

24 Month CD from Sallie Mae BankSallie Mae Bank is new to our list of the best CD rates, but they’re not new to our list of the best money market rates. While Sallie Mae is widely known for their student loans, the banking division – which was established in 2005 – offers pretty competitive deposit rates. The 24-month CD Sallie Mae Bank is currently offering has an APY of 2.80% with a minimum deposit amount of $2,500. Deposits made to this bank are FDIC-insured.

  • 2-Year CD from a Credit Union: Greenwood Credit Union – 2.80% APY, $1,000 minimum deposit

Greenwood Credit Union
Greenwood Credit Union is open to anyone and everyone. The only requirement to become a member with this credit union is to open their Share Savings Account with a minimum deposit amount of $5. You’ll also have to maintain that amount in the account to remain an active member. When you go to apply for membership, you can also add that you want to open their 24 month CD. You’ll need to deposit $1,000 in order to earn their outstanding 2.80% APY. This deposit will be in addition to the $5 to open the Share Savings Account. Accounts can be managed online or through their mobile app. Deposits made to Greenwood Credit Union are insured by the NCUA.

LEARN MORE Secured

on Greenwood Credit Union’s secure website

 

  • 3-Year CD: PurePoint Financial – 3.00% APY, $10,000 minimum deposit

36 Month Online CD from PurePoint Financial
Despite having a high deposit amount of $10,000, PurePoint Financial has one of the highest rates on a 36-month CD. PurePoint Financial is a division of MUFG Union Bank, N.A. Both are backed by Mitsubishi UFJ Financial Group, which is the fifth largest financial group in the world. It is offering some of the most competitive rates, not only with their CDs, but also with their online savings account. With their CDs, they have a Best Rate Commitment, which means that if you fund the account within 10 days of submitting the application, they will make sure that you receive the best rate during that time period. In an ever-increasing rate environment, that’s a pretty good promise. While they mainly function as online-only bank, they don’t currently have a mobile app.

LEARN MORE Secured

on PurePoint Financial’s secure website

Member FDIC

  • 3-Year CD from a Credit Union: CommunityWide Federal Credit Union, 3.00% APY, $2,000 minimum deposit

60 Month IRA from Communitywide Federal Credit UnionCommunityWide Federal Credit Union was established in 1967 to provide quality financial services to those residing on the west side of South Bend, IN. Today, the credit union operates similarly even though they’ve expanded their footprint in Michigan. Thanks to their online services, however, their able to service customers nationwide. Anyone can become a member of this credit union if they are a donor member of one of their partner organizations, such as the Y.M.C.A. Once you become a member, you can open a 36-month CD with a minimum of $2,000. This account earns an APY of 3.00%. CommunityWide Federal Credit Union allows you to manage your account online and is NCUA-insured.

LEARN MORE Secured

on Communitywide Federal Credit Union’s secure website

  • 5-Year CD: M.Y. Safra Bank – 3.06% APY, $5,000 minimum deposit

3 Month Online Promo (New Money) from M.Y. Safra BankM.Y. Safra Bank, located in New York, NY, was established in 2000. They currently have over $368 million in assets. Their 5-year CD has an APY of 3.06%, which is one of the highest currently available. You’ll need $5,000 to deposit to open the account and a little patience navigating their website. While they do have a mobile app, you’ll have to first apply for an account online.

LEARN MORE Secured

on M.Y. Safra Bank’s secure website

Member FDIC

  • 5-Year CD from a Credit Union: Connexus Credit Union – 3.25% APY, $5,000 minimum deposit

60 Month Certificate from Connexus Credit UnionIf you’re able to deposit $5,000 into a CD, you’ll want to consider this 5-year CD with an incredible 3.25% APY. Anyone is able to join the credit union by making a donation of $5 to their organization called Connexus Association. This organization provides scholarships and assists educational institutions. They have a mobile banking app as well as an online banking platform.

LEARN MORE Secured

on Connexus Credit Union’s secure website

3 Questions To Ask Before You Open A CD

1. Should I just open an online savings account instead?

With a CD, the saver and the bank make stronger commitments. The saver promises to keep the funds in the account for a specified period of time. In exchange, the bank guarantees the interest rate during the term of the CD. The longer the term, the higher the interest rate – and the higher the penalty for closing the CD early. With a savings account, there are few promises. You can empty the account without paying a penalty and the bank can change the interest rate at any time.

If you have a high level of confidence that you do not need to touch the money for a specified period of time, a CD is a much better deal. However, if you think you might need to use the money in the next couple of months, a savings account is a much better idea.

You can earn a lot more interest with a CD. Imagine you have $10,000 and know that you do not need to touch the money for two years. In a high-yield savings account earning 1.60%, you would earn $322.56 over two years. If you put that money into a 2.51% CD, you would earn $508.30. Given the ease of switching to an online CD, the extra interest income is easy money.

2. What term should I select?

The early withdrawal penalties on CDs can be significant. On a 1-year CD, 90 days is a typical penalty. And on 2 and 3 year CDs, a 6-month penalty is common. The impact of the penalty on your return can be significant. If you opened a one-year CD with a 2.20% APY and closed it after six months, you would forfeit half of the interest and earned only 1.11%. You would have been better off with a savings account paying 1.60%.

The worst case scenario is with the longest CDs. 5-year CDs usually have a one-year penalty for taking out funds early. If you open a 5-year CD and close it quickly, you could actually end up losing money.

Given the early penalties, you need complete confidence that you will not need to withdrawal the money early. Ask yourself this question: “do I have 90% confidence that I will not need access to the cash during the CD term?” If you don’t have confidence, go for a shorter term or a savings account.

3. Should I consider my local bank or credit union?

The interest rates shown in this article are all from online banks that offer products nationally. Our product database includes traditional banks, community banks and credit unions. If traditional banks offered better rates, they would have been featured in this article. The internet-only banks have dramatically better interest rates. That should not be surprising. Because internet-only banks do not have branches, they are able to pass along their cost savings to you in the form of higher interest rates.

However, you can always visit your local bank or credit union and ask them to beat the rates listed in this article. The chance of getting a better deal is extremely low (remember that Bank of America is only paying 0.07%), but you can try.

How To Find The Best Account

If you don’t find an account that meets your needs in this article, you can use the MagnifyMoney CD tool to find the best rate for your individual needs. Input your zip code, deposit amount and term. The tool will then provide you with CD options, from the highest APY to the lowest.

You can learn more about us and how we make money here.

Advertiser Disclosure: The card offers that appear on this site are 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 card companies or all card offers available in the marketplace.

Nick Clements
Nick Clements |

Nick Clements is a writer at MagnifyMoney. You can email Nick at nick@magnifymoney.com

TAGS: