Since the Fed started hiking interest rates last year in order to cool inflation, savers are getting more bang for their buck.
A certificate of deposit (CD) is one type of savings account that’ll help you earn more. Commonly offered by banks (with credit unions offering a similar account called a share certificate), CDs typically pay a higher interest rate than traditional savings accounts in exchange for tying up your money for a set term. Withdrawing money from your account before time is up usually means paying a penalty.
Editorial team ranked more than 40 CDs and came up with a list of our top 10 picks. We considered factors like the minimum deposit, annual percentage yields (APYs) for one-, three-, and five-year terms, compounding frequency, and customer service options.
Change In 3 Month Cd Rates, By Bank Size
Here’s our rundown of the top 10 CDs, including the key figures you should know before you open an account. (Note: APYs are up to date as of August 2, 2023 but are subject to change.)
About: Bread Savings, formerly Comenity Direct Bank, is an online-only bank that offers CDs ranging from one to five years, as well as a high-yield savings account.
Penalty: Early withdrawal penalties do apply for Bread’s CD accounts. For terms shorter than one year, the penalty is 90 days simple interest. For one to three-year terms, the penalty is 180 days simple interest. For terms greater than four years, the penalty is 365 days simple interest.
How Are Cd Rates Determined?
While its opening deposit is above $1, 000, Bread Savings offers its customers competitive APYs (well above 4%) on its one-, three-, and five-year CDs, with accrued interest compounded daily and credited monthly. Account holders are not charged for certain CD services like monthly maintenance fees, but will be charged $25 for outgoing wire transfers, $15 for official check requests, and $5 paper statement fees. Customers can bank with Bread online or via its mobile app. For assistance, they can connect with a Bread Savings customer service representative via telephone on weekdays between 7 a.m. and 9 p.m. CT, and weekends.
**While our methodology only considered 1-, 3-, and 5-year CDs, here are the other CD terms available if you’re looking for more options:
About: Barclays is a London-based bank that offers online services to customers in the U.S. While it doesn’t have any physical locations in the U.S., it does offer a handful of CD terms, ranging from 12 months to 60 months.
Chase Bank Cd Rates: August 2023
Penalty: There is an early withdrawal penalty of 90 days of simple interest for CDs with terms of two years or less. For CDs longer than two years, there’s a penalty of 180 days of simple interest.
Barclays’ CDs boast competitive APYs with no hidden monthly fees or minimum balances to open an account, which means you can cash in on high APYS regardless of how much money you have to save.You can choose to keep earned interest in your CD account or have it transferred monthly to a separate Barclays savings account or a verified external bank account. U.S. customers can reach a Barclays representative by calling their toll-free number between 8:00 a.m.–8:00 p.m. ET seven days a week.
About: Quontic Bank is a digital bank that first started as a community bank in New York City in 2009. It is a Community Development Financial Institution (CDFI) so it provides banking services to low-income communities. Quontic is FDIC-insured and offers online and mobile banking platforms and checking account, savings account, and mortgage products.
U.s. Bank Cd Rates: August 2023
Penalty: For CDs redeemed within the first year, the penalty is equal to the interest for the full length of your CD term. CDs between 12 and 24 months will incur a penalty equal to one year of interest. For CDs 24 months and over, the penalty is equal to two years’ worth of interest.
Quontic Bank’s CDs made our list for a few reasons. High APYs paired with a lack of monthly fees and a minimum deposit of $500 makes these CDs a viable option for savers who want to earn interest on their funds without surprise fees. The downside: hefty early withdrawal penalties mean that you’ll owe big bucks if you tap your money early. Customer service representatives are only available on weekdays via live chat, email, and telephone between 9:00 a.m. and 6:00 p.m. ET.
About: Ally Bank is an online-only bank offering checking, savings, mortgage, auto products, and more. Its CD terms range from three months to five years.
Bank Of America Cd Rates: August 2023
Ally’s CD offerings give savers a wide range of term options and let them decide how much they’re ready to save, with a $0 minimum deposit to open an account. Customers aren’t subject to any monthly maintenance fees and interest on these accounts is compounded daily. Bonus: Ally Bank offers customers 24/7 phone, chat, and email support.
About: BMO Harris is one of the largest banks in North America by assets. Its products and services include checking accounts, savings accounts, money market accounts, CDs, retirement accounts, credit cards, and more.
BMO Harris’ CDs made our list for its competitive CD rates. However, these rates depend on your location and how much you’re investing. One con: the early withdrawal penalties on these CDs are higher than some of our other picks, so savers should be careful about withdrawing funds early. Interest on your balance compounds daily. BMO Harris customer service is available via phone from 7:00 a.m. to 10:00 p.m. CT on weekdays and 8 a.m. to 8 p.m. on Saturdays and Sundays.
Cd Rates Forecast: How High Will Rates Rise In 2023?
About: Synchrony Bank is an online bank that offers a wide range of savings and credit products. Customers can bank online or via mobile app. Its CD terms range from three months to five years.
Penalty: There is an early withdrawal penalty applied to the amount of principal withdrawn between 90 and 365 days’ simple interest depending on your account terms.
Synchrony’s CD accounts don’t require a minimum deposit, meaning that savers can start investing with any amount. Interest is compounded daily and you can withdraw
Bank Of The Ozarks Cd Rates
Paid during your CD’s current term anytime without penalty. You can reach Synchrony Bank via phone or online chat, or download its mobile app.
About: Founded in 2009, CFG Bank is a Maryland-based bank that offers one- to five-year CDs, as well as money market accounts, traditional checking accounts, and commercial banking products. The bank offers a handful of brick-and-mortar locations across Maryland, although customers can also bank with CFG online or via the mobile app.
CFG offers a 1-year CD with an APY topping 5.05%, and you’ll just need $500 to start investing. Customer service representatives can be reached by telephone, Monday through Friday, 9:00 a.m. to 5 p.m. ET and customers can also contact CFG via email.
Best Cd Rates Of August 2023: Up To 5.83%
About: Pentagon Federal Credit Union (PenFed) is a Virginia-based credit union that offers online banking options in addition to a few brick-and-mortar locations across the U.S. Customers can benefit from their wide range of financial products including checking and savings accounts, credit cards, auto loans, home loans, and more.
Penalty: For certificates (credit union equivalent of a CD) redeemed within the first year, all dividends will be forfeited. For certificates redeemed after the first year but before maturity, the penalty is equal to 30% of what would’ve been earned if the certificate had been held to maturity.
PenFed scored a spot on our list for their stellar APYs and higher-than-average customer service score. Though their early withdrawal penalty is more severe than other options, this account can provide customers with all of the perks of a credit union while still offering a lucrative APY on par with major banks, plus—interest on these accounts compounds daily. For assistance, customers can reach PenFed by email, chat, or phone Monday to Friday, 7:00 a.m. to 11:00 p.m. EST, 8:00 a.m. to 11:00 p.m. on Saturday, and 9:00 a.m. to 5:30 p.m. EST on Sunday.
Guide: Best Cd Rates (highest Cd Interest Rates Comparison)
About: First Internet Bank of Indiana was established in 1999, operating online but with headquarters in Indiana. The bank provides savings accounts, money market accounts, and CDs, among other consumer banking services.
Penalty: For CDs with term lengths ranging from one year to 18 months, you’ll owe 180 days worth of interest. If you opt for a longer term CD—more than two years—you’ll have to pay 360 days worth of interest.
First Internet has some of the highest APYs—with a 1-year CD providing a 5.35% APY. This account isn’t for everyone though as the minimum opening deposit $1, 000. You can also reach customer service representatives multiple ways, either via email, chat, or phone. If you call, customer service is available from 7 a.m. until 9 p.m. EST and on Saturday between 9 a.m. and 3 p.m. EST.
Citibank Cd Interest Rates
About: Marcus by Goldman Sachs is an online bank with no physical locations that offers a wide range of savings, investment, credit, and lending products. Its CD terms range from six months to six years.
Penalty: You’ll owe 90 days, 180 days, or 270 days of simple interest for a 1-year CD, 3-year CD, or 5-year CD, respectively.
Marcus’ high-yield CDs offer a competitive rate with a wide range of terms to help savers hit every kind of investment goal. Interest on these accounts
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