11 Best CD Rates for Consumers (for 2020)

Banking
Updated: 27th Oct 2020
Written by Drew Cheneler
Share this article
How to Find Your Navy Federal Routing Number (Quick & Easy)
TD Bank Routing Number: How to Find It and What It Is
Banking
June 21, 2020
Written by Drew Cheneler

Disclaimer: This post contains references to products from one or more of our advertisers. We may receive compensation (at no cost to you) when you click on links to those products. Read our Disclaimer Policy for more information.

Believe it or not, the best CD rates come from Online Banks and Credit Unions. As we transition into a digital era, online options will continue to outpace their brick and mortar counterparts.

If you are fine restricting some of your hard-earned capital for a higher interest rate, then a certificate of deposit cannot be beat. It is a low cost, risk-free way to compound and grow your savings.

Our evaluations were based off low fees, 1 – 3 years APYs, customer service, and how easy it is to sign up for an account.

Our team has evaluated multiple online banks, credit unions, and traditional banks, here are our top picks for the best CD rates in 2020.

Best CD Rates In 2020 

1. CIT Bank

With no account opening or maintenance fees, CIT Bank offers some great short to mid – term CD Rates. Even better, this bank offers a sweet no penalty 11 – month CD. CIT Bank provides a healthy selection of CD rates to choose from: 6 – month to 5 – year. However, their 13 & 18 – Month CDs offer the most competitive APY.

6 – Month CD: 0.72% APY

11 – Month CD: 1.75% APY (No – Penalty CD)

1 – Year CD: 1.80% APY

13 – Month CD: 1.82% APY

18 – Month CD: 1.85% APY

2 – Year CD: 1.40% APY

3 – Year CD: 1.30% APY

4 – Year CD: 1.50% APY

5 – Year CD: 1.70% APY

Minimum Deposit: $1,000

Even with a $1,000 minimum deposit, CIT Bank is a safe bet if you are looking for a low – fee, FDIC – Insured Certificate of Deposit. Fret not, this award-winning bank has the technological infrastructure that allows you to bank anywhere, anytime.

2. Ally Bank High Yield CD

Since their establishment, Ally Bank has always offered the best CD rates in the industry. As an online bank, they offer the lowest fees and make it wildly easy to sign up. With no monthly maintenance fees and no minimum deposit, Ally Bank is a great place to get a top-rated FDIC – insured CD from.

3 – Month CD: 0.75% APY

6 – Month CD: 1.00% APY

9 – Month CD: 1.25% APY

1 – Year CD: 2.00% APY

3 – Year CD: 2.05% APY

5 – Year CD: 2.15% APY

Minimum Deposit: $0

Fret not, Ally Bank offers CD’s ranging from 3 months to 5 – years. Better yet, if you would also like to start investing, Ally Bank has a great platform to start a Roth IRA and Robo – Advisor, so you can passively invest.

As an online bank, Ally is best for individuals who want the freedom to control their CD, checking account, or other banking product from their lap top or phone; however, if you do run across a problem, simply call them and enjoy speaking to their representatives who are available 24/7.

Want to Learn More? Check out our Ally Bank Review.

3. Discover High Yield CD

As a leading financial institution, Discover Bank offers a myriad of competitive CD rates. With no monthly fee or opening fees, this is one of the best places to park your money for the long-term.

As evident, their most competitive CD rates are from their 1 – 10-year options. Even though their $2,500 Minimum Opening Balance is high, their wide selection of competitive CD rates makes up for it.

3 – Month CD: 0.35% APY

6 – Month CD: 0.65% APY

9 – Month CD: 0.70% APY

1 – Year CD: 2.00% APY

18 – Month CD: 2.00% APY

2 – Year CD: 2.05% APY

30 – Month CD: 2.05% APY

3 – Year CD: 2.05% APY

4 – Year CD: 2.05% APY

5 – Year CD: 2.10% APY

7 – Year CD: 2.15% APY

10 – Year CD: 2.20% APY

Minimum Deposit: $2,500

Aside from CD’s, Discover also offers credit cards, a high yield savings account, checking accounts, and even CDs for Roth IRAs. With 24/7 customer service and a robust mobile application, Discover will be with you every step of the way. Yes – Member FDIC – Insured.

4. First Tech Federal Credit Union

Created in 1952, First Tech Federal Credit Union has a long history of providing competitive CDs. However, to qualify as a member of this credit union, you need to join the Financial Fitness Association (fee of $8) or Computer History Museum (fee of $15).

I know, not the most convenient; however, they offer some of the Best CD rates around. See for yourself.

6 – Month CD: 1.60% APY

1 – Year CD: 1.90% APY

3 – Year CD: 2.15% APY

5 – Year CD: 2.20% APY

Minimum Deposit: $500

Again, if you want a low risk yet powerful way to compound your savings, then First Tech certainly warrants consideration. If you are satisfied with their easy-to-use platform and NCUA – insured rate, they will even allow you to bump up your Certificate of Deposit to a higher rate.

Respectively, a 13 – Month Certificate yields a 1.85% APY, 24 – month certificate bumps up to a 2.00% APY, and a 36 – month will rise to a 2.10% APY.

5. Alliant Credit Union

If you are looking for a socially responsible credit union, then Alliant is your best choice for a Certificate of Deposit. Simply put, to be a member, you must agree to support Foster Care to Success. On your behalf, they will give a $5 donation. \

With no monthly fees, CD rates ranging from 1 – 5 years and a $1,000 minimum opening balance, Alliant Credit Union is ready to serve as your new financial institution.

1 – Year CD: 1.90% APY

18 – Month CD: 1.90% APY

2 – Year CD: 1.95% APY

30 – Month CD: 2.10% APY

3 – Year CD: 1.95% APY

4 – Year CD: 1.95% APY

5 – Year CD: 2.05% APY

Minimum Deposit: $1,000

If you want more flexibility, then just wait. Alliant Credit Union will allow you to select a term of any month if it is between 1 – 5 years. So, if you are dying to have a 19 – month CD then go for it. With 24/7 Customer Service and NCUA – insured, Alliant Credit Union is ready to serve you and help you meet your financial goals.

6. Marcus High-Yield CDs

Marcus, as a branch of Goldman Sachs, offers competitive Certificate of Deposits. With a low minimum deposit and no monthly fees, Marcus provides you with CDs ranging from 6 – months to 6 – years. If you are looking for a long-term CD, then this banking powerhouse will be a great fit for you.

6 – Month CD: 0.60% APY

9 – Month CD: 0.70% APY

1 – Year CD: 2.15% APY

18 – Month CD: 2.05% APY

2 – Year CD: 2.10% APY

3 – Year CD: 2.10% APY

4 – Year CD: 2.10% APY

5 – Year CD: 2.25% APY

6 – Year CD: 2.30% APY

Minimum Deposit: $500

As you can see, their long-term Certificate of Deposits offer the most competitive APY. However, it important to note, that Marcus does not have a mobile application or any physical locations. This bank is best if you are fine monitoring your account from a computer.

Of course, Marcus has customer service representatives staffed and ready to assist you at any time. Member FDIC – Insured.

7. Synchrony Bank

With about 80 million active customers and $64 Billion in deposits to FDIC – insured CDs, IRAs, and money market accounts, Synchrony Bank has made a name for themselves. They offer CDs with terms ranging from 6-month to 60-month.

3 – Month CD: 0.75% APY

6 – Month CD: 1.00% APY

9 – Month CD: 1.25% APY

1 – Year CD: 2.00% APY

13 – Month CD: 2.05% APY

14 – Month CD: 2.15% APY

2 – Year CD: 2.10% APY

3 – Year CD: 2.10% APY

4 – Year CD: 2.10% APY

5 – Year CD: 2.15% APY

Minimum Deposit: $2,000

Aside from their traditional certificate of deposits, Synchrony also provides IRA CDs if you want a low-risk investment vehicle to compound your money for retirement. For years, Synchrony has provided customer service that is second to none.

Their service and wide variety of CDs to choose from make this bank a great option if you want a detailed experience.

8. Citizens Access 

As they proclaim, “simply smarter savings,” Citizens Access offers a hand full of high-yield CDs. Ranging from 1 – 5 years, their CDs all yield an APY higher than 2.0%. Better yet, they do not charge monthly maintenance fees and neglect an opening fee.

Citizens Access is all about providing you low fees with a robust customer experience.

1 – Year CD: 2.10% APY

2 – Year CD: 2.10% APY

3 – Year CD: 2.15% APY

4 – Year CD: 2.20% APY

5 – Year CD: 2.25% APY

Minimum Deposit: $5,000

Though the $5,000 minimum deposit to open an account is steep, Citizens Access still offers an APY that is north of 2.0%. They even offer a 11-month liquid CD which yields 1.85%. Member FDIC – Insured.

9. Barclays

Finally, a CD that does not require an opening balance. However, the short-term CD rates are not the most competitive, but their long-term rates are certainly worth checking out.

Barclays, is a world-renowned financial institution headquartered in London. It is no wonder they offer FDIC – insured CDs with low-fees.

3 – Month CD: 0.35% APY

6 – Month CD: 0.65% APY

9 – Month CD: 0.70% APY

1 – Year CD: 2.00% APY

2 – Year CD: 2.00% APY

18 – Month CD: 2.00% APY

3 – Year CD: 2.00% APY

4 – Year CD: 2.00% APY

5 – Year CD: 2.10% APY

Minimum Deposit: $0

The $0 minimum deposit to open an account is worth touting. As you can see, their most competitive rates are between 1 – 5 years, so if you are in for the long-haul then Barclays should garner your interest.

They offer customer service every day for 12 – hours. Sadly, it is not 24/7. Enjoy monitoring your performance on their website that is mobile friendly, so you never miss a beat.

10. Connexus Credit Union

Simply donate $5 to Connexus Association (a non-profit) and you will become a new member. Connexus Credit Union offers some of the highest Share Certificates around. Do not worry, a share certificate is the same thing as a banks Certificate of Deposit.

With no monthly maintenance or opening account fees, Connexus Credit Union provides low-fees yet high interest-bearing Share Certificates.

1 – Year CD: 2.01% APY

2 – Year CD: 2.21% APY

3 – Year CD: 2.31% APY

5 – Year CD: 2.41% APY

Minimum Deposit: $5,000

Though the $5,000 minimum account deposit is a steep, the low-fees and competitive APY make Connexus Credit Union an attractive option. Their 2, 3, & 5-year rates are the highest on the list.

This bank also has a robust mobile and desktop application, allowing you to control your account anytime, anywhere. Member NCUA – Insured.

11. Capital One 360 CDs

Here is the deal, Capital One’s Online CDs are great. They offer low – fees, no minimum deposit, and even have a flexible payout feature. This feature allows you to choose when your interest is paid out: weekly, monthly, or yearly.

As an FDIC – insured financial institution, their 1 – Year CD (2.0% APY) rate is popular amongst their clients, rightfully so.

6 – Month CD: 0.60% APY

9 – Month CD: 0.80% APY

1 – Year CD: 2.00% APY

18 – Month CD: 1.90% APY

2 – Year CD: 1.80% APY

30 – Month CD: 1.70% APY

3 – Year CD: 1.65% APY

4 – Year CD: 1.65% APY

5 – Year CD: 1.60% APY

Minimum Deposit: $0 

Touted as having one of the best mobile applications, Capital One makes it easy for you to monitor and adjust your Certificate of Deposits. Fret not, if you have any questions, all you must do is call Capital One, and one of their representatives will assist you immediately.

Their staff is available 7 days a week via phone, chat, or even Twitter. Rest easy, they will make sure you have the best Online Banking experience.

What Is A Certificate of Deposit (CD)? How Do CD Accounts Work?  

At the forefront of banking products, a certificate of deposit (CD) is a fan favorite amongst millions of hard-working individuals. If you are already a prudent money saver or just starting on your journey to financial independence, a CD is an excellent starting point.

A certificate of deposit is a savings account that offers you a fixed interest rate over a certain period – commonly known as a term. It is important to note, that during this length of time you are agreeing to lock away your money, and if you decide to withdrawal your money early then you may encounter a fee.

However, since you are agreeing to this, banks typically pay a higher annual percentage yield (typically around 2.0% for 1 – year).

What Is A CD Rate? 

A CD rate is given as an annual percentage yield. The APY reveals how much the account will earn in one year. Yes – the APY includes compound interest – in case you were wondering. As a common practice, financial institutions traditionally compound interest daily, monthly, or annually.

As you can see, the term length affects the CD rate as well. Generally, the longer the CD term, the higher APY you will receive.

Let’s work through a quick example to further our understanding.

A financial institution is offering a 1 – year certificate of deposit at a 2.0% APY. Let’s say you decide to deposit $2,000.

After one year, your account is now at $2,040. This may not seem like alot, but for doing absolutely nothing, this is great.

Remember, a CD Account is essentially a savings account. This is a sure shot way to grow and compound your savings over time.

What Are the Different Types of CDs? 

Like all banking products, there are multiple different types of CDs that you should know. Each CD has their pros & cons. Make sure to review all options and choose the best one that meets your specific financial goals.

1. Jumbo CDs

A CD with an account balance greater than $100,000. This may seem like a lot of money; however, banks will reward you with a higher APY (usually 3.0% or more).

2. No – Penalty CDs

Fortunately, some online banks and credit unions offer CDs that do not charge you for early withdrawal. This type of CD is like a high-yield savings account, and their APYs are competitive with their counterparts.

3. Bump – up CDs

A certificate of deposit that allows you to change your interest rate during the term. Here is how it works: You decide to put your money into a 3 – year CD that offers a 1.80% APY and within two years the bank now offers a 3 – year CD with a 2.10% APY, you can change your interest rate to the higher APY.

4. Brokered CDs

A certificate of deposit that is created by an established bank or credit union, but available to you by your brokerage firm. Since they are available to you by a brokerage firm, you can trade the CD before the term expires. Do not worry, a Brokered CD acts the exact same as a regular CD.

Do CDs Have Fees? 

No, unlike other banking products, a CD typically does not have a monthly maintenance fee or opening account fee. If you are reviewing CDs that have these two common fees, then I highly encourage you to look elsewhere.

However, CDs do have a penalty charge you if you decide to withdrawal your money early (before the term expires). Unless you encounter a dire financial situation, it is best to keep your money in the CD for the entire term duration. The last thing you want to do is pay a costly fee to access your funds.

What Are the Advantages of A CD? 

A CD is a great way for you to earn a high interest rate while simultaneously assuming little to no risk. Unlike a high-yield savings account – which the interest rate constantly fluctuates up and down – a CD will pay you an agreed upon annual percentage yield.

Regardless of market or economic conditions, you have a fixed – interest rate that is paying you every month. Better yet, CDs have little to no fees, so you truly are getting the best bang for your buck.

What Are the Disadvantages of A CD? 

Though there are many advantages to a CD, there are also some potential drawbacks that you need to consider. A CD requires you to commit your money to a specific length of time, whether it be 3 – months or 5 – years.

Unlike a Savings or Checking Account, a CD traditionally has a higher minimum opening deposit. As you can see from our selection of the Best CDs, the initial deposit can range from $500 – $5,000.

Can You Lose Money in A CD? 

Aside from the early withdrawal penalty that we discussed earlier, you cannot lose money in a CD account if the bank or credit union is FDIC – insured or NCUA – insured.

How Do I Choose the Best CD? 

We all have various financial goals and obligations, but the Best CD will offer you a competitive APY, low to no fees, great customer service, and a doable minimum deposit if there is one. More importantly, you want to choose a CD that is offered by an insured financial institution.

This will protect you in case anything happens.

As we move more towards online banking, you want a CD that is accompanied with a robust mobile and desktop application, so you can manage your account anywhere, anytime.

Fortunately, our selection of the Best CD Rates incorporates these minute features that make a big difference.

 

Drew Cheneler
Drew Cheneler
Drew is a recognized Credit, Small Business, and Personal Finance Expert. He has been quoted in CNBC, Fox Business News Section, The Huffington Post, Business.com, Moneyunder30, US Chamber of Commerce, and more. He is known for breaking down complex personal finance topics into action-oriented advice, so you can make the most of your hard-earned money.