Are you looking for a secure way to grow your money? With the current interest rate environment, certificates of deposit (CDs) have become an attractive choice. The Federal Reserve has raised the federal funds rate multiple times, pushing CD rates to new highs. However, rate cuts are expected in 2024, making now the ideal time to consider opening a CD account to take advantage of impressive yields.
Best CD Rates Today Compared to 2024
To help you grow your savings, we’ve rounded up the best CD rates available now. These rates are based on the highest annual percentage yields (APYs) as of December 1st, 2023. Let’s dive in and explore the top CD options:
Forbright
Have you ever wanted to save money while making a positive impact on the environment? Forbright’s CDs might be the perfect choice for you. With some of the best CD rates available, Forbright finances green energy projects, reducing carbon emissions. You can open a CD account with a minimum deposit of $1,000 and easily manage it through Plaid integration.
Popular Direct
Popular Direct offers multiple CD options with competitive rates. Whether you have more to save or prefer shorter terms, Popular Direct has something for you. With a minimum deposit of $10,000, you can open a CD account with a term as short as three months or as long as five years. Enjoy round-the-clock customer support and convenient account management through their online platform or mobile app.
Bread Savings
If you have substantial savings and prefer a conservative approach, Bread Savings offers flexibility. You can deposit up to $1 million in a single CD account and keep up to $10 million across all your accounts with Bread. Keep in mind that the FDIC only insures up to $250,000 per ownership category. So, if you’re considering depositing $1 million, it may be wise to spread it across four CDs at different banks.
LendingClub
Known for personal loans, LendingClub also offers high-yield CDs. With a minimum deposit of $2,500, you can choose a CD term ranging from six to 60 months. LendingClub stands out for its competitive rates and excellent reputation for customer service. Consider the entirety of what a bank has to offer when choosing the best CD rates.
BMO Alto
BMO Alto features some of the best CD rates among online-only CDs. With no minimum deposit or balance requirements, BMO Alto offers flexibility and convenience. Choose from six terms ranging from six months to five years and enjoy monthly interest payments. Estimate your potential earnings using BMO’s CD calculator.
Barclays
At Barclays, you can choose from 12 to 60-month CDs without a minimum opening deposit requirement. Start earning interest by depositing an amount that fits your financial situation. Whether you can only afford $250 or more, Barclays has options for you. Opening a CD account with Barclays is a great way to learn about CDs while earning an impressive interest rate.
Quontic Digital Bank
Quontic offers CD accounts along with some of the best checking account options for those looking for an alternative to traditional banking. With a $500 minimum deposit, you can enjoy competitive rates and the option to ladder CDs. While there are no monthly fees, it’s important to note that there is a penalty for early withdrawals.
Discover
Discover Bank offers a wide range of CD terms, ideal for savers with long-term goals. Although the highest rate is reserved for the 9-month CD account, you can still earn competitive rates with other terms, such as the 12-month CD account. To open a CD with Discover, you’ll need a minimum deposit of $2,500, which is the highest requirement among the banks listed here. Discover also offers high-interest checking accounts, money market accounts, and one of the best high-yield savings account options.
CIT Bank
CIT Bank features competitive rates, with the highest APY offered for their six-month CDs. However, they also offer a great rate with their 11-month no-penalty CD. This option allows you to withdraw cash ahead of the maturity term without sacrificing your accrued interest. With a minimum deposit of $1,000, you can open a CD account and explore other savings options CIT Bank has to offer, including high-yield savings accounts and home loans.
Valley Direct
Valley Bank offers a competitive APY for their 12-month CD account. You can open a CD with a deposit of $500 to $500,000.
Nationwide
Nationwide partners with Axos Bank to offer CD accounts with terms ranging from three months to five years. The best rate is earned with their 12-month CDs. You can open a Nationwide CD with just $500 and enjoy the convenience of managing your accounts online or through mobile banking.
U.S. Bank
While traditional banks typically don’t offer the highest CD rates, U.S. Bank is an exception. With various CD options, including CD specials, standard CDs, step-up CDs, and trade-up CDs, U.S. Bank has something for everyone. Their CD specials, ranging from 7 to 19 months, earn the highest APYs. You can open any of U.S. Bank’s CDs online, even if you’re not an existing customer. Joint CD accounts are also available.
How to Select the Best CD Account for You
Choosing the best CD account requires understanding your needs and thoroughly researching different banks. Here are some tips to help you make the right choice:
- Shop around: CD rates, terms, and minimum deposits vary from bank to bank. Compare and explore different options to find the best fit for you.
- Know your goals: Consider your savings goals when choosing a CD. Longer-term CDs may be more suitable for larger goals, while shorter-term CDs can work for shorter-term objectives.
- Compare minimum deposits: Choose a CD that allows you to deposit an amount that you’re comfortable with.
- CD rates: While longer-term CDs usually have higher rates, it’s worth exploring special CDs that offer more interest for shorter terms.
- Early withdrawal penalties: Understand the penalties associated with early withdrawal, as it can affect your savings.
- Other banking options: If you’re looking for comprehensive banking services, consider what else a bank offers, such as checking accounts, savings accounts, and loans.
How Are CD Rates Changing?
CD rates have been on an upward trend, driven by adjustments to the federal funds rate. As the Federal Reserve raises rates, banks can increase CD rates and other interest-bearing accounts. However, the Fed is expected to cut interest rates in 2024, making it a good time to open a CD account before that happens.
Alternatives to CDs
While CDs are a popular savings option, there are other alternatives to consider:
- Investment accounts: Investing in stocks, bonds, or other securities can offer higher interest rates, but it comes with higher risk.
- High-yield savings accounts: Explore high-yield savings accounts, which can provide competitive rates while maintaining liquidity.
TIME Stamp: Opening a CD Gets You Closer to Your Savings Goals
Your choice of bank matters when it comes to reaching your savings goals. Whether you choose one of the options discussed here or start with your current bank, compare CD rates, maturity terms, and early withdrawal penalties. Stay informed about interest rate trends to make the most of your savings.
Frequently Asked Questions (FAQs)
Q: What is considered a good CD rate?
A: A good CD rate depends on the overall interest-rate environment. Rates around 1.00% are considered good when rates are low, while rates around 5.00% can be expected when rates are high. Comparing different banks will help you find the best rates.
Q: What is the highest-paying 12-month CD?
A: Several online banks offer highly competitive rates for 12-month CDs, ranging from 4.75% to 5.00%. Traditional banks may offer lower rates.
Q: Are 10-year CD rates worth it?
A: Whether a 10-year CD is worth it depends on your goals and your expectations for CD rates. It may be attractive if you expect rates to drop substantially and remain low, but it may not be suitable if you expect rates to rise or need access to your money before maturity.
Remember that APYs are subject to change, and the rates provided were up-to-date as of January 2, 2024.
Stay informed and choose the best CD account to grow your savings and reach your financial goals.