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The Best CD Rates – December 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

The Best CD Rates
iStock

Updated December 14, 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 2.65% 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 December 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

PenFed Credit Union

2.80%

$1,000

Apply Now Secured

on PenFed Credit Union’s secure website

NCUA Insured

1 years

Vio Bank

2.71%

$500

Apply Now Secured

on Vio Bank’s secure website

Member FDIC

1 years

Synchrony Bank

2.65%

$2,000

Apply Now Secured

on Synchrony Bank’s secure website

Member FDIC

1 years

Barclays

2.65%

$0

APPLY NOW Secured

on Barclays’s secure website

Member FDIC

See a full list of the best CD rates below.

  • 6 months – 7 years: PenFed Credit Union – 2.40% APY – 3.50% 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.

  • 6-months: 2.40%
  • 12-months: 2.80%
  • 15-months: 2.85%
  • 18-months: 2.90%
  • 2-years: 2.95%
  • 3-years: 3.05%
  • 4-years: 3.15%
  • 5-years: 3.50%
  • 7-years: 3.50%

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

  • 6 months – 5 years: Capital One – 0.60% APY – 3.10% APY; no minimum deposit

12 Month 360 CD from Capital OneCapital One is famous for its credit card business. However, it has recently started getting aggressive with its CD rates. There is no minimum deposit for their 360 CDs, which make them comparable to Barclays’ CDs. Capital One CDs are FDIC insured, up to the federal maximum. And you get the comfort of depositing your money with a well-known bank.

  • 6-months: 0.60% APY
  • 9-months: 0.75% APY
  • 12-months: 2.70% APY
  • 18-months: 2.70% APY
  • 24-months: 2.80% APY
  • 30-months: 2.80% APY
  • 36-months: 2.85% APY
  • 48-months: 2.90% APY
  • 60-months: 3.10% APY

LEARN MORE 

Member FDIC

  • 6 months  – 120 months: 2.00% APY – 3.15% APY; $500 minimum deposit

12 Month High Yield Online CD from Vio BankVio Bank, a division of MidFirst Bank, is an online bank you don’t want to ignore. It launched in August 2018 with highly competitive offerings and it has continued to offer top rates on both its CDs and online savings account. While Vio Bank hasn’t been around very long, they are supported by a financial institution that is established with over $16 billion in assets. We’re extremely impressed with its early start. Here’s a full list its current CD rates:

  • 6-months: 2.00%
  • 9-months: 2.40%
  • 12-months: 2.71%
  • 15-months: 2.75%
  • 18-months: 2.80%
  • 24-months: 3.00%
  • 36-months: 3.05%
  • 48-months: 3.10%
  • 60-months: 3.15%
  • 84-months: 3.15%
  • 120-months: 3.15%

LEARN MORE Secured

on Vio Bank’s secure website

Member FDIC

  • 3 months – 5 years: Synchrony Bank – 0.75% APY – 3.10% 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: 2.65% APY
  • 15-months: 2.75% APY
  • 18-months: 2.75% APY
  • 24-months: 2.80% APY
  • 36-months: 2.85% APY
  • 48-months: 2.95% APY
  • 60-months: 3.10% APY

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

  • 6 months – 6 years: Goldman Sachs Bank USA – 0.60% APY – 3.15% 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: 2.65% APY
  • 18-month: 2.65% APY
  • 2-year: 2.70% APY
  • 3-year: 2.75% APY
  • 5-year: 3.10% APY
  • 6-year: 3.15% APY

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

  • 1 year – 5 years: Barclays Bank – 2.65% – 3.10% 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: 2.65% APY
  • 2-year: 2.70% APY
  • 3-year: 2.75% APY
  • 4-year: 2.85% APY
  • 5-year: 3.10% APY

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

  • 3 months – 5 years: Ally Bank – 0.75% APY – 3.10% 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 3.10% 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. A good example of this is a 1% cash back promotion Ally is currently offering to new and 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: 2.65% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.65% APY ($25k minimum deposit)
  • 18-months: 2.50% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.70% APY ($25k minimum deposit)
  • 3-year: 2.60% APY (less than $5k); 2.70% APY ($5k minimum deposit) and 2.75% APY ($25k minimum deposit)
  • 5-year: 3.10% APY (less than $5k); 3.10% APY ($5k minimum deposit) and 3.10% APY ($25k minimum deposit)

  • 1-Year CD: Live Oak Bank – 2.85% APY, $2,500 minimum deposit

1 Year CD from Live Oak BankLive Oak is a bank you’ll want to notice. With a minimum deposit amount of $2,500, you can earn an outstanding APY of 2.85%. While they’re still a small bank when compared to Synchrony, Goldman Sachs, and Ally, they have quickly grown to have over $2 billion in assets. They do have a mobile banking app as well as the option to bank online. Although they have the capability to manage your account digitally, you will have to call one of their Customer Success Managers in order to withdraw your funds once the account matures.

  • 2-Year CD: KS StateBank – 3.10% APY, $500 minimum deposit

2 Year CD from KS StateBankKS StateBank is mainly a brick-and-mortar institution located in Kansas and Phoenix, Arizona. However, they also offer online services to reach those not in their area. Sometimes, they even offer special rates to their online customers. With a minimum deposit of $500, you can open KS StateBank’s 2 year CD online. This APY is not an online special and you can use the funds in the CD as collateral for a loan from this bank in the future. The bank offers online banking and a mobile app to conveniently manage your account.

LEARN MORE Secured

on KS StateBank’s secure website

Member FDIC

  • 2-Year CD from a Credit Union: Connexus Credit Union – 3.00% 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 2-year CD with an incredible 3.00% 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

NCUA Insured

  • 3-Year CD from a Credit Union: Mountain America Credit Union, 3.35% APY, $500 minimum deposit

3 Year Term Deposit from Mountain America Credit UnionMountain America Credit Union was established in the 1930s to help its members achieve their financial goals. Today, they have grown to serve hundreds of thousands of members and have acquired over $7 billion in assets. This credit union is open to Utah residents in certain areas, family members of existing members of the credit union, and employees and volunteers of a Select Employer Group. If you are a member or become a member of the American Consumer Council, you’ll qualify for membership at Mountain America Credit Union. Once you become a member, you’ll be able to open a CD. You’ll need to deposit a minimum of $500 in order to earn their outstanding 3.35% APY. Accounts can be managed online or through their mobile app. Deposits made to Mountain America Credit Union are insured by the NCUA.

LEARN MORE Secured

on Mountain America Credit Union’s secure website

NCUA Insured

  • 3-Year CD: ableBanking – 3.30% APY, $1,000 minimum deposit

3 Year CD from ableBankingableBanking is an online bank with competitive rates. It is a division of Northeast Bank, which is based in Maine. Together, the banks have acquired over $1 billion in assets. ableBanking typically has competitive rates and this is evident with its 3-year CD. With a minimum deposit of $1,000, you can open this CD and begin earning a 3.30% APY. ableBanking has a mobile app for your convenience.

LEARN MORE 

Member FDIC

  • 5-Year CD: Northpointe Bank – 3.60% APY, $1,000 minimum deposit

60+ Month CD Special from Northpointe BankNorthpointe Bank was founded on the principal of “real people working with real people.” In 1999, the founder of the bank didn’t want his customers’ experience to be inpersonal, so he built a bank with a set of values that focus on the customers first and foremost. As a result of this, this bank typically offers competitive rates on its banking products. If you have a minimum deposit of $1,000 to put into Northpointe Bank’s 5-year CD, you can benefit from its high rate of 3.60%. A huge downside to this account is that CDs cannot be opened online. You’ll have to call the bank to open the account if you’re not in an area that has a branch. Once you have your account opened, you can download Northpointe Bank’s mobile app to manage your account.

LEARN MORE Secured

on Northpointe Bank’s secure website

Member FDIC

  • 5-Year CD from a Credit Union: United States Senate Federal Credit Union – 3.51% APY, $1,000 minimum deposit

United States Senate Federal Credit Union

Despite what the name may suggest, you do not have to be a Senate employee to join the United States Senate Federal Credit Union. If you don’t meet the work or family qualifications, you can easily become a member by joining the American Consumer Council, Virginia Chapter (VACC) or by joining the U.S. Capitol Historical Society (USCHS). This credit union was established by nine employees of the United States Senate during the Great Depression. Since then, the credit union has grown to have over $717 million in assets.

Currently, the United States Senate Federal Credit Union is offering amazing rates on its 5-year CD. With a minimum deposit of $1,000, you can earn an APY of 3.51%. If you deposit more, the APY increases. The other tiers are as follows:

  • $20,000-$59,999.99: 3.57% APY
  • $60,000-$99,999.99: 3.63% APY

LEARN MORE Secured

on United States Senate Federal Credit Union’s secure website

NCUA Insured

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 2.50% 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 2.05%.

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

Nick Clements
Nick Clements |

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

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Advertiser Disclosure

Earning Interest

The Best CD Rates – December 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 December 14, 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 2.65% 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 December 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

PenFed Credit Union

2.80%

$1,000

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

2 years

KS StateBank

3.10%

$500

LEARN MORE Secured

on KS StateBank’s secure website

Member FDIC

3 years

Mountain America Credit Union

3.35%

$500

LEARN MORE Secured

on Mountain America Credit Union’s secure website

NCUA Insured

5 years

Northpointe Bank

3.60%

$1,000

LEARN MORE Secured

on Northpointe Bank’s secure website

Member FDIC

See a full list of the best CD rates below.

  • 6 months – 7 years: PenFed Credit Union – 2.40% APY – 3.50% 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.

  • 6-months: 2.40%
  • 12-months: 2.80%
  • 15-months: 2.85%
  • 18-months: 2.90%
  • 2-years: 2.95%
  • 3-years: 3.05%
  • 4-years: 3.15%
  • 5-years: 3.50%
  • 7-years: 3.50%

LEARN MORE Secured

on PenFed Credit Union’s secure website

NCUA Insured

  • 6 months – 5 years: Capital One – 0.60% APY – 3.10% APY; no minimum deposit

12 Month 360 CD from Capital OneCapital One is famous for its credit card business. However, it has recently started getting aggressive with its CD rates. There is no minimum deposit for their 360 CDs, which make them comparable to Barclays’ CDs. Capital One CDs are FDIC insured, up to the federal maximum. And you get the comfort of depositing your money with a well-known bank.

  • 6-months: 0.60% APY
  • 9-months: 0.75% APY
  • 12-months: 2.70% APY
  • 18-months: 2.70% APY
  • 24-months: 2.80% APY
  • 30-months: 2.80% APY
  • 36-months: 2.85% APY
  • 48-months: 2.90% APY
  • 60-months: 3.10% APY

LEARN MORE 

Member FDIC

  • 6 months  – 120 months: 2.00% APY – 3.15% APY; $500 minimum deposit

12 Month High Yield Online CD from Vio BankVio Bank, a division of MidFirst Bank, is an online bank you don’t want to ignore. It launched in August 2018 with highly competitive offerings and it has continued to offer top rates on both its CDs and online savings account. While Vio Bank hasn’t been around very long, they are supported by a financial institution that is established with over $16 billion in assets. We’re extremely impressed with its early start. Here’s a full list its current CD rates:

  • 6-months: 2.00%
  • 9-months: 2.40%
  • 12-months: 2.71%
  • 15-months: 2.75%
  • 18-months: 2.80%
  • 24-months: 3.00%
  • 36-months: 3.05%
  • 48-months: 3.10%
  • 60-months: 3.15%
  • 84-months: 3.15%
  • 120-months: 3.15%

LEARN MORE Secured

on Vio Bank’s secure website

Member FDIC

  • 3 months – 5 years: Synchrony Bank – 0.75% APY – 3.10% 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: 2.65% APY
  • 15-months: 2.75% APY
  • 18-months: 2.75% APY
  • 24-months: 2.80% APY
  • 36-months: 2.85% APY
  • 48-months: 2.95% APY
  • 60-months: 3.10% APY

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

  • 6 months – 6 years: Goldman Sachs Bank USA – 0.60% APY – 3.15% 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: 2.65% APY
  • 18-month: 2.65% APY
  • 2-year: 2.70% APY
  • 3-year: 2.75% APY
  • 5-year: 3.10% APY
  • 6-year: 3.15% APY

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

  • 1 year – 5 years: Barclays Bank – 2.65% – 3.10% 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: 2.65% APY
  • 2-year: 2.70% APY
  • 3-year: 2.75% APY
  • 4-year: 2.85% APY
  • 5-year: 3.10% APY

LEARN MORE Secured

on Barclays’s secure website

Member FDIC

  • 3 months – 5 years: Ally Bank – 0.75% APY – 3.10% 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 3.10% 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. A good example of this is a 1% cash back promotion Ally is currently offering to new and 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: 2.65% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.65% APY ($25k minimum deposit)
  • 18-months: 2.50% APY (less than $5k); 2.65% APY ($5k minimum deposit) and 2.70% APY ($25k minimum deposit)
  • 3-year: 2.60% APY (less than $5k); 2.70% APY ($5k minimum deposit) and 2.75% APY ($25k minimum deposit)
  • 5-year: 3.10% APY (less than $5k); 3.10% APY ($5k minimum deposit) and 3.10% APY ($25k minimum deposit)

  • 1-Year CD: Live Oak Bank – 2.85% APY, $2,500 minimum deposit

1 Year CD from Live Oak BankLive Oak is a bank you’ll want to notice. With a minimum deposit amount of $2,500, you can earn an outstanding APY of 2.85%. While they’re still a small bank when compared to Synchrony, Goldman Sachs, and Ally, they have quickly grown to have over $2 billion in assets. They do have a mobile banking app as well as the option to bank online. Although they have the capability to manage your account digitally, you will have to call one of their Customer Success Managers in order to withdraw your funds once the account matures.

  • 2-Year CD: KS StateBank – 3.10% APY, $500 minimum deposit

2 Year CD from KS StateBankKS StateBank is mainly a brick-and-mortar institution located in Kansas and Phoenix, Arizona. However, they also offer online services to reach those not in their area. Sometimes, they even offer special rates to their online customers. With a minimum deposit of $500, you can open KS StateBank’s 2 year CD online. This APY is not an online special and you can use the funds in the CD as collateral for a loan from this bank in the future. The bank offers online banking and a mobile app to conveniently manage your account.

LEARN MORE Secured

on KS StateBank’s secure website

Member FDIC

  • 2-Year CD from a Credit Union: Connexus Credit Union – 3.00% 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 2-year CD with an incredible 3.00% 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.

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on Connexus Credit Union’s secure website

NCUA Insured

  • 3-Year CD from a Credit Union: Mountain America Credit Union, 3.35% APY, $500 minimum deposit

3 Year Term Deposit from Mountain America Credit UnionMountain America Credit Union was established in the 1930s to help its members achieve their financial goals. Today, they have grown to serve hundreds of thousands of members and have acquired over $7 billion in assets. This credit union is open to Utah residents in certain areas, family members of existing members of the credit union, and employees and volunteers of a Select Employer Group. If you are a member or become a member of the American Consumer Council, you’ll qualify for membership at Mountain America Credit Union. Once you become a member, you’ll be able to open a CD. You’ll need to deposit a minimum of $500 in order to earn their outstanding 3.35% APY. Accounts can be managed online or through their mobile app. Deposits made to Mountain America Credit Union are insured by the NCUA.

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on Mountain America Credit Union’s secure website

NCUA Insured

  • 3-Year CD: ableBanking – 3.30% APY, $1,000 minimum deposit

3 Year CD from ableBankingableBanking is an online bank with competitive rates. It is a division of Northeast Bank, which is based in Maine. Together, the banks have acquired over $1 billion in assets. ableBanking typically has competitive rates and this is evident with its 3-year CD. With a minimum deposit of $1,000, you can open this CD and begin earning a 3.30% APY. ableBanking has a mobile app for your convenience.

LEARN MORE 

Member FDIC

  • 5-Year CD: Northpointe Bank – 3.60% APY, $1,000 minimum deposit

60+ Month CD Special from Northpointe BankNorthpointe Bank was founded on the principal of “real people working with real people.” In 1999, the founder of the bank didn’t want his customers’ experience to be inpersonal, so he built a bank with a set of values that focus on the customers first and foremost. As a result of this, this bank typically offers competitive rates on its banking products. If you have a minimum deposit of $1,000 to put into Northpointe Bank’s 5-year CD, you can benefit from its high rate of 3.60%. A huge downside to this account is that CDs cannot be opened online. You’ll have to call the bank to open the account if you’re not in an area that has a branch. Once you have your account opened, you can download Northpointe Bank’s mobile app to manage your account.

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on Northpointe Bank’s secure website

Member FDIC

  • 5-Year CD from a Credit Union: United States Senate Federal Credit Union – 3.51% APY, $1,000 minimum deposit

United States Senate Federal Credit Union

Despite what the name may suggest, you do not have to be a Senate employee to join the United States Senate Federal Credit Union. If you don’t meet the work or family qualifications, you can easily become a member by joining the American Consumer Council, Virginia Chapter (VACC) or by joining the U.S. Capitol Historical Society (USCHS). This credit union was established by nine employees of the United States Senate during the Great Depression. Since then, the credit union has grown to have over $717 million in assets.

Currently, the United States Senate Federal Credit Union is offering amazing rates on its 5-year CD. With a minimum deposit of $1,000, you can earn an APY of 3.51%. If you deposit more, the APY increases. The other tiers are as follows:

  • $20,000-$59,999.99: 3.57% APY
  • $60,000-$99,999.99: 3.63% APY

LEARN MORE Secured

on United States Senate Federal Credit Union’s secure website

NCUA Insured

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 2.35%, you would earn $475.52 over two years. If you put that money into a 2.65% CD, you would earn $537.02. 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 2.65% APY and closed it after six months, you would forfeit half of the interest and earned only 1.32%. You would have been better off with a savings account paying 2.05%.

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

Nick Clements
Nick Clements |

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

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Earning Interest, Reviews

Discover Bank CD Rates Review

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Discover Bank
Most people know Discover as a credit card company, but it also operates an online bank and offers some of the best rates and terms on checking and savings accounts and certificates of deposit (CDs). As a bank, Discover offers some of the best products on the market. Currently, they’re offering a major deal on their online savings account. If you apply for their savings account by 01/14/19 and deposit or grow a balance of at least $15,000 by 01/28/19, you can earn a $150 bonus. If you deposit or grow a balance of at least $25,000 by the same date, you can earn a $200 bonus. Applying for the account is easy as you don’t need to go to a branch. You can apply online or over the phone. Just be sure to enter or mention the promo code MM1218 when you apply.

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on Discover Bank’s secure website

Member FDIC

See Advertiser Website for Full Details
 

If you’re looking for CDs in particular, Discover is currently considered to have some of the best CDs due to their customer service and digital tools.

Discover Bank CD rates

CD term

Annual Percentage Yield (APY)

3 months

0.35%

6 months

0.65%

9 months

0.70%

12 months

2.60%

18 months

2.60%

24 months

2.65%

30 months

2.65%

3 years

2.70%

4 years

2.75%

5 years

3.00%

7 years

3.05%

10 years

3.10%

LEARN MORE Secured

on Discover Bank’s secure website

How do Discover Bank CD rates compare?

While Discover Bank CD rates aren’t always the highest available, they are consistently among the top offers across all terms. However, you may be able to find a similar or even better rate with a CD that has a lower minimum deposit than Discover’s $2,500 requirement. Currently, several nationwide banks offered a 12-month CD at a rate higher than Discover’s 12-month CD APY, while requiring a lower minimum deposit. For example, at the same time the above rates were available at Discover, there were 12-month CDs with rates as high as 2.65% APY with a lower minimum balance amount to earn the APY.

It’s always great to go for the highest interest rates possible, but keep your CD investing strategy in mind. If you’re investing in CDs using the ladder strategy, it might be easier to keep everything in one bank since you’ll be switching in and out of CDs frequently.

Discover also stands out from its competition in the CD space with its mobile app and 24/7 U.S.-based customer service. If you value such features, keep those particulars in mind when weighing Discover CD rates against others’.

What you need to know about Discover Bank’s CDs

Discover Bank is very transparent in terms of fine print. It’s not difficult to understand what’ll happen with your money after you invest it. We’ll cover the basics here about what you need to know to invest in Discover Bank’s CDs.

How to open a CD

It’s very simple to open up a CD with Discover Bank. Go to their CD webpage and click on the orange “Open an Account” button near the top right of the page. You can then choose which accounts you’d like to open. Select “CD,” choose a CD term and enter how much you’d like to deposit.

You’ll then need to complete the application by providing your name, address, date of birth, phone number, Social Security number, employment status and possibly even your driver’s license. Once your application is complete and accepted, you’ll need to fund the account.

How to fund the CD

You’ll need to fund it within 45 days of submitting your application, which you can do in one of three ways:

  • Transfer funds from another bank account over the phone. (You can only do this when you first fund your account.)
  • Transfer funds from another bank via online transfer.
  • Write a check to yourself and send it to the following address:Discover Bank
    P.O. Box 30417
    Salt Lake City, UT 84130

The minimum deposit amount for each of Discover Bank’s CDs is $2,500. Once you open a CD, you can’t deposit more money later, so it’s a good idea to make sure you have all the cash you want to invest before you open the account.

Withdrawing funds from the CD

When you want to withdraw money from your CD, the biggest thing to consider is whether that CD has matured yet, or finished its term.

If your CD has not matured, you’ve got options: You can take the interest out penalty-free at any time, or you can withdraw the principal (or the money you deposited) at any time as long as you pay an early-withdrawal penalty. This penalty varies depending on the original term of your CD:

  • less than one year: three months’ worth of simple interest
  • one year to less than four years: six months’ worth of simple interest
  • four years: nine months’ worth of simple interest
  • five years to less than seven years: 18 months’ worth of simple interest
  • seven years or longer: 24 months’ worth of simple interest

If your CD has finished its term, you can withdraw your money penalty-free, allow the CD to renew or roll it into a CD of a different term length. (More on that in a bit).

Earning interest on a Discover CD

Your CD will start earning interest on the same business day that you fund the account. The interest will be added to your account once each month, however.

When it comes to what to do with your interest, you have two options: The default option is to allow it to compound within the CD (meaning you’ll earn interest on that interest), or you can have it automatically deposited each month into another Discover bank account.

What happens once the CD matures?

You’ll get a heads-up notice about a month before your CD matures so you can decide what to do with the money. You have two main options: Either reinvest it into another CD (of the same term length or a different term length), or withdraw the money from the CD and put it into another account (such as a checking or savings account, or perhaps a CD at a different institution).

If you don’t let Discover know what you want to do with the maturing CD, the CD will automatically renew into another one of the same term length. You have a nine-day grace period after your CD automatically rolls over to make any changes or withdrawals penalty-free.

The bottom line

As far as big-name banks go, Discover offers great CD products. Wells Fargo, for example, only offers interest rates as high as 1.55% APY on a $5,000 deposit for a 58-month CD. Chase Bank offers even lower maximum rates — an abysmal 1.05% APY, and only if you can commit a minimum of $100,000 for 10 years.

If you’re the kind of person who likes to keep your finances in one place, Discover also has great credit cards, as well as competitive online savings and checking accounts. No matter how long you’re considering putting money in a CD, Discover is worth a look. Even if it doesn’t have the best available rate, it’s usually within several basis points of the top offerings and well above the average APY.

LEARN MORE Secured

on Discover Bank’s secure website

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

Lindsay VanSomeren
Lindsay VanSomeren |

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

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Best of, Earning Interest

The Best IRA CD Rates – December 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have 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 December 6, 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 December 6, 2018.)

The best IRA rates in December 2018

Term

Institution

APY

Minimum Deposit Amount

3 months

TIAA Direct

1.90%

$5,000

6 months

CommunityWide Federal Credit Union

2.30%

$2,000

12 months

State Department Federal Credit Union

2.68%

$500

18 months

First Internet Bank

2.84%

$1,000

2 years

Connexus Credit Union

3.00%

$5,000

3 years

Mountain America Credit Union

3.35%

$500

4 years

Mountain America Credit Union

3.25%

$500

5 years

Greenwood Credit Union

3.00%

$1,000

 

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

TIAA Bank
Three-month regular CDs are earning an average interest rate of 0.44% APY currently. TIAA Bank is exceeding that, with an interest rate of 1.90% APY with their 3-Month Yield Pledge IRA CD. With that APY and a $5,000 minimum deposit, you would earn $23.58 when the certificate matures.

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on TIAA Bank’s secure website

Member FDIC

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

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 2.30% APY for deposits of $2,000 and over. That translates into earnings of $22.87 if you were only to deposit the minimum amount. Compare that to the average of all regular 6 month CDs, at 0.78%.

LEARN MORE Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

1-Year IRA CD Rates – State Department Federal Credit Union, 12 Month IRA Certificate (Traditional, Roth)

12 Month IRA Certificate from State Department Federal Credit UnionRegular one-year CDs earn an average interest rate of 1.23% APY. State Department Federal Credit Union, however, is offering a one-year IRA CD at 2.83% APY. You’ll need a $50 minimum deposit to earn interest once you’ve been approved for membership.

LEARN MORE Secured

on State Department Federal Credit Union’s secure website

NCUA Insured

18-Month IRA CD Rates – First Internet Bank, 18 Month IRA Certificate (Traditional, Roth)

18 Month IRA from First Internet Bank18-month regular CDs earn an average interest rate of 1.49% APY. First Internet Bank on the other hand, is currently offering 2.84% APY on an 18-month IRA CD. You’ll need a minimum deposit of $1,000 to open the account.

LEARN MORE 

Member FDIC

 

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

24 Month Certificate from Connexus Credit UnionTwo-year regular CDs earn an average interest rate of 1.56% APY. Connexus Credit Union, on the other hand, is currently offering 3.00% APY on a 2-year IRA CD. This would translate into earnings of $304.50 with a minimum $5,000 deposit.

3-Year IRA CD Rates – Mountain America Credit Union, 3 Year IRA (Traditional, Roth)

3 Year Term Deposit Plus from Mountain America Credit UnionThree-year regular CDs are earning an average interest rate of 1.77% APY currently. Mountain America Credit Union is exceeding that, with an interest rate of 3.35% APY with their 3-year IRA CD. You’ll need a minimum deposit amount of $500 to open this account.

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on Mountain America Credit Union’s secure website

NCUA Insured

 

4-Year IRA CD Rates – Mountain America Federal Credit Union, 4 Year IRA (Traditional, Roth)

4 Year Term Deposit from Mountain America Credit UnionFour-year regular CDs are currently earning an average interest rate of 1.89% APY. Mountain America Federal Credit Union claims the top interest rate for these IRA CDs, with an interest rate of 3.25% APY. It’s interesting enough to note that Mountain America FCU’s 3-year IRA has a higher rate. You need a $500 minimum deposit to open the account.

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on Mountain America Credit Union’s secure website

NCUA Insured

 

5-Year IRA CD Rates – Greenwood Credit Union, 60 Month IRA Certificate (Traditional, Roth, CESA, SEP)

60 Month IRA Certificate from Greenwood Credit UnionFive-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 2.18% APY, however Greenwood Credit Union outperforms the average with a 3.00% APY on its 5-year IRA CD for members. The minimum deposit is $1,000.

LEARN MORE Secured

on Greenwood Credit Union’s secure website

NCUA Insured

 

6+ Year IRA CD Rates – Michigan State University Federal Credit Union, 7 Year IRA Special (Traditional, Roth, CESA, SEP)

Michigan State University Federal Credit Union offers the highest term for their seven-year IRA CD, at 3.50% APY. That’s less than Greenwood Credit Union which offers a 3.00% APY for a five-year IRA CD. Still, with Michigan State University Federal Credit Union’s seven-year IRA CD, you would earn $680.70 on a minimum deposit of $2,500 when the IRA CD matures.

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

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

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 December 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have 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: Barclays Bank – 12-Month CD – 2.65% APY

Barclays Bank is currently offering one of the highest CD rates available on a 1-year 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 2.65% APY with any amount as this account doesn’t have a minimum balance. This high rate will be locked in for the duration of the term once the account is funded.

LEARN MORE Secured

on Barclays’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 December 6, 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

3 months

1.25%

$100,000

My eBanc

6 months

2.25%

$100,000

KS StateBank

1 year

2.75%

$100,000

Veridian Credit Union

18 months

3.05%

$100,000

KS StateBank

2 years

3.10%

$100,000

KS StateBank

3 years

3.25%

$100,000

Veridian Credit Union

4 years

3.45%

$100,000

KS StateBank

5 years

3.51%

$100,000

As of December 6, 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 1.25%. Currently, M.Y. Safra Bank is offering a 3 Month Online Promo CD with a better rate at 1.61%, but it wasn’t factored into this chart since this category is specifically for jumbo CD offerings.

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 2.25%.

LEARN MORE Secured

on My eBanc’s secure website

Veridian Credit Union

Veridian Credit Union
Veridian Credit Union is headquartered in Waterloo, Iowa, has 30 locations and over 700 employees. You can become a member of the credit union if you live in the area or if you’re a registered user of Dwolla, an e-commerce company which is available to

You can see current rates on jumbo CDs on the Veridian rate sheet. Keep in mind that several of the rates listed are current specials and might not be available long term. At the time of this writing, Veridian Credit Union has a special on an 18-month jumbo CD with an APY of 3.05% and a 4-year jumbo CD with a 3.45% APY. This credit union also has various specials on 7, 9, and 15 month jumbo CDs.

LEARN MORE Secured

on Veridian Credit Union’s secure website

NCUA Insured

KS StateBank

KS StateBank

KS StateBank currently has internet-only specials on their 1, 2, 3, and 5-year jumbo CDs. This 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

Member FDIC

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

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

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Best of, Earning Interest

The Best Credit Union CD Rates – December 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have 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 September 2018, the average one-year credit union CD had a 1.10% annual percentage yield (APY), compared to the 0.87% 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 December 5, 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, 1.75% 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 1.75%, compared to the national average of 0.92% in June. You would earn $17.50 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

NCUA Insured

NASA Federal Credit Union – 1-Year Share Certificate, 1.25% 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

NCUA Insured

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.

PenFed Credit Union – 1-Year Money Market Certificate, 2.80% APY, min. deposit $1,000

PenFed Credit Union
PenFed has an outstanding APY of 2.80%. With a minimum deposit of $1,000, you could earn $24.50 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

Connexus Credit Union – 12 Month Certificate, 2.80% 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 $140 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

NCUA Insured

Alliant Credit Union – 12-17 Month Share CD, 2.65% APY, min. deposit $1,000

Alliant Credit Union
With a minimum deposit of $1,000, you could earn an APY of 2.65% on a 12-17 month CD. 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

NCUA Insured

CommunityWide Federal Credit Union – 12 Month CD, 2.65% APY, min. deposit $2,000

Communitywide Federal Credit Union
Membership 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.

LEARN MORE Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

State Department Federal Credit Union – 12 Month CD, 2.63% APY, min. deposit $500

Membership to State Department Federal Credit Union is open to employees of the U.S. Department of State Employees, those affiliated with or employed by select employers and organizations, and those related to an existing member. However, if you’re not eligible by any of those means, you can qualify by becoming a member of the American Consumer Council, which you can choose to do when you’re filling out the membership application.

Once you’re a member of the State Department Federal Credit Union, you can open a 12-month CD with a minimum of $500. The early withdrawal penalty will be the lesser of 180 days worth of dividends on the withdrawn amount or the amount of dividends that you have earned since opening the CD.

on State Department Federal 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.

Redstone Federal Credit Union – 12 Month MemberPlus Regular Share Certificate, 2.21% 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 2.21% 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

NCUA Insured

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

NCUA Insured

Wright-Patt Credit Union – 1-Year Certificate, 1.97% 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 $8.80 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 2.07%, which will return $1,870 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

NCUA Insured

Delta Community Credit Union – 1-Year Certificate, 1.95% 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 1.95%. 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

NCUA Insured

 

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

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

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Earning Interest

Top 10 Jumbo Money Market Accounts

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Jumbo money market accounts
iStock

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.

Capital One 360, 2.00% APY, $10,000 Minimum Deposit

Capital One
Capital One offers savings accounts, checking 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 2.00% 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 or another good option to consider would be their 360 Savings Account which earns 1.00% APY regardless of balance, until you are able to hit the $10,000 threshold.

While 360 Money Market Account does not come with any fees, it also does not come with any checks. It does come with a debit card, which you can get after the account has been opened. You may withdraw money through an ATM. Just keep in mind that you’ll be restricted to six certain transfers and withdrawals per month due to federal law. You can easily access your account through Capital One’s online portal, mobile app, or you can call to speak to one of their representatives.

LEARN MORE 

Member FDIC

earn.bank, 2.31% APY, $100 Minimum Deposit

Money Market Account from earn.bankearn.bank, a division of Silvergate Bank, was created around the idea of offering premium rates on bank accounts. Taking a look at the rate the bank is offering on its money market account makes it hard to argue with this idea. For a small minimum deposit of $100, you can receive an APY of 2.31%. While the rate is outstanding and you can earn it with a small deposit amount, you may have to pay a $10 monthly maintenance fee if you have an average daily balance below $10,000. Another downside to this account is that it doesn’t come with check-writing capabilities or even a debit card to withdraw money. If you’re okay with having your money in a complete online bank account, then you may not mind the lack of these two features. You are able to transfer money via ACH online. earn.bank also has a mobile app that allows you to manage this account on the go.

LEARN MORE Secured

on Earn.bank’s secure website

Member FDIC

Northpointe Bank, 2.30% APY, $25,000 Minimum Balance

Liquid Money Market from Northpointe BankNorthpointe Bank is based out of Grand Rapids, MI, but services customers nationwide. The founder of the Northpointe Bank envisioned that the bank would focus on customer service first and foremost, and would offer real value to its customers. Running on these values, Northpointe Bank tries to offer competitive rates to new and existing customers. Currently, the bank is offering a2.30% APY on its money market account with a minimum balance amount of $25,000. You only need $1,000 to open the account, but you won’t earn the high rate unless you meet the balance requirement. If you decide to work your way up to the balance requirement here’s what you’ll get with each tier:

  • Up to $2,500: 0.20% APY
  • $2,500 – $24,999.99: 0.25% APY
  • $25,000 – $1m: 2.30% APY
  • $1m+: 2.30% APY

If you’re able to earn the high rate, you’ll be guaranteed this rate for 24 months. This account comes with checks and a debit card upon request. Northpointe Bank supports online banking and has a mobile banking app.

LEARN MORE Secured

on Northpointe Bank’s secure website

Member FDIC

Pacific National Bank, 2.25% APY, $5,000 Minimum Deposit

MMDA Online Special (New Money Only) from Pacific National BankPacific National Bank, headquartered in Miami, FL, provides banking services to customers nationwide through its online banking platform. Currently, the bank is offering a money market account with a high rate of 2.25%. You’ll need to deposit a minimum of $5,000 to earn that rate and waive the monthly maintenance fee of $25. This account does have checking writing capabilities and a mobile banking app is available to download.

LEARN MORE Secured

on Pacific National Bank’s secure website

Member FDIC

BankPurely, 2.25% 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 2.25% 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, 2.20% 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 2.20% 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

Member FDIC

KeyBank, 2.20% APY, $25,000 Minimum Deposit

KeyBank
KeyBank offers one of the highest APY money market accounts — at least during the initial twelve-month promo period. During the first year, money market accounts with balances between $25,000 and $2,000,000 earn an APY of 2.20%. Unfortunately, this rate may not be available in all markets, so make sure you enter your zip code to get the rate that pertains to your location. Also, you must open a checking account with KeyBank to qualify for this promotion.

After the promotional period is over, your rates will drop to 0.12% APY for balances over $25,000 as long as you have an average of at least one deposit and eight withdrawals from your KeyBank checking account during the past three statement periods. At this point, amounts under $25,000 will earn 0.10% APY.

Whether you’re in the promotional period or not, you will be charged an $18 monthly maintenance fee. You will also be charged a $15 fee every time you make more than six withdrawals from your money market account in any given statement period.

LEARN MORE Secured

on KeyBank’s secure website

Member FDIC

Bank7, 2.05% APY, $5,000 Minimum Deposit

Bank 7
Bank7 is based in Oklahoma but has branches in Texas and Kansas as well. It also offers access to its deposit products online nationwide.
To open a high-yielding money market account at Bank7, you must have a minimum deposit of at least $5,000. From there, your account will earn 2.05% APY until your balance reaches $1 million. Then, you’ll stop earning interest. If your daily balance drops below $5,000, you will be charged a $15 fee per month.
To take money out of your account, you can use a debit card or 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, Bank7 will charge you a $3 fee each time you take out more money.

LEARN MORE Secured

on Bank 7’s secure website

Member FDIC

North American Savings Bank, 2.02% APY, $50,000 Minimum Deposit

North American Savings Bank

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 2.02% 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 1.77%. If you balance grows anywhere between $25,000 and $49,999, the APY will increase to 2.02%. 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.

LEARN MORE Secured

on North American Savings 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

Member FDIC

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

Brynne Conroy
Brynne Conroy |

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

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Best of, Earning Interest

The Top 6 Month CD Rates for December 2018

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have 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 December 4, 2018, and we excluded promotional offerings. The national average APY on 6 month CDs (among banks and credit unions) is 0.77%, 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

6 Month CD from DollarSavingsDirect

DollarSavingsDirect

6 month CD APY: 2.40%
Bank information: DollarSavingsDirect is an online division of Emigrant Bank. Founded by Irish emigrants in 1850, Emigrant Bank has created various online divisions throughout the years. DollarSavingsDirect seems to be the most active and competitive online division when it comes to its rates.
Where to open CD account: Online
Minimum balance to open: $1,000
Maintenance fees: $0
Early withdrawal penalties: 90 days’ interest

LEARN MORE Secured

on DollarSavingsDirect’s secure website

Member FDIC

6 Month CD from Live Oak Bank

Live Oak Bank

6-month CD APY: 2.35%
Bank information: Live Oak Bank is located in Wilmington, NC, but serves customers nationwide through online banking. While their initial focus was to help small businesses acquire funding, they now help all individuals through personal banking.
Where to open CD account: Online
Minimum balance to open: $2,500
Maintenance fees: $0
Early withdrawal penalties: 90 days’ interest

LEARN MORE Secured

on Live Oak Bank’s secure website

Member FDIC

Virtual Bank

VirtualBank

6 month CD APY: 2.31%
Bank information: VirtualBank is a subsidiary of Louisiana-based IBERIABANK Corp., offering 24/7 digital or telephone access on eCDs, open to applicants anywhere in the U.S.
Where to open CD account: Online (paperless account options)
Minimum balance to open: $10,000
Maintenance fees: $0
Early withdrawal penalties: 30 days’ interest

LEARN MORE Secured

on Virtual Bank’s secure website

Member FDIC

6 Month CD from Colorado Federal Savings Bank

Colorado Federal Savings Bank

6 month CD APY: 2.28%
Bank information: Colorado Federal Savings Bank is a federally insured bank serving customers across the United States. While the bank is headquartered in and began doing business in Colorado, it provides banking services to individuals nationwide.
Where to open CD account: Online
Minimum balance to open: $5,000
Maintenance fees: $0
Early withdrawal penalties: 3 months’ worth of interest

LEARN MORE Secured

on Colorado Federal Savings Bank’s secure website

Member FDIC

First Internet Bank

First Internet Bank

6 month CD APY: 2.27%
Bank information: A subsidiary of First Internet Bancorp, this online bank founded in 1999 has no branch locations, but offers service online in all 50 states.
Where to open CD account: Online
Minimum balance to open: $1,000
Maintenance fees: $0
Early withdrawal penalties: 90 days’ interest

LEARN MORE Secured

on First Internet Bank’s secure website

Member FDIC

Credit unions with the best 6 month CD rates

PenFed Credit Union

PenFed Credit Union

6 month CD APY: 2.40%
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

36 Month Share Certificate from Communitywide Federal Credit Union

CommunityWide Federal Credit Union

6 month CD APY: 2.30%
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.

LEARN MORE Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

6 Month Certificate from State Department Federal Credit Union

State Department Federal Credit Union

6 month CD APY: 2.06%
Credit union information: State Department Federal Credit Union was established in 1935 by eight people employed by the United States Department of State. Since then, they have expanded to serve a multitude of members worldwide.
Membership details: Anyone can join by the credit union by joining the American Consumer Council, which you can do when you’re filling out your application. Check to see, however, if you’re able to join through employment, organization affiliation, or through an immediate family member.
Where to open CD account: You can open an account online or at one of their many branches.
Minimum balance to open: $500
Maintenance fees: $0
Early withdrawal penalties: 30 days of dividends on the withdrawn amount or the amount of dividends you’ve earned since the account opened – the credit union will impose the lesser of the two.

LEARN MORE Secured

on State Department Federal Credit Union’s secure website

NCUA Insured

6 Month CD from AFFCU

AFFCU

6 month CD APY: 2.05%
Credit union information: Air Force Federal Credit Union is headquartered in San Antonio, TX. It was established in 1952 by Airmen volunteers and currently serves individuals in the military as well as civilians.
Where to open CD account: Online
Minimum balance to open: $1,000
Maintenance fees: $0
Early withdrawal penalties: Equal to half of the interest accrued starting from the withdrawal date through the maturity date.

LEARN MORE Secured

on AFFCU’s secure website

NCUA Insured

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

NCUA Insured

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.

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Gabby Hyman
Gabby Hyman |

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

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