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December 2024's Best CD Rates

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We maintain strict editorial integrity in our writing and assessments. This post contains links from our advertisers, and we may receive compensation when you click these links. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone. | Advertiser Disclosure
We maintain strict editorial integrity in our writing and assessments. This post contains links from our advertisers, and we may receive compensation when you click these links. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone. | Advertiser Disclosure

Finding the Best CD Rates

One way to save and grow your money is to use a certificate of deposit (CD) account. These low-risk banking products essentially lock your money up for a specific period of time in exchange for an interest rate. CDs are offered at many financial institutions, including banks and credit unions, with their APYs typically being some of the strongest. To help you sift through the many options, SmartAsset did the research and put together this list of the best CDs on the market right now.

To calculate how much interest you could earn with a CD, try using SmartAsset's CD calculator.

Bank
APY tooltip icon
Min. Deposit Highlights
Bread Financial logo Bread Financial 4.30% $1,500
  • High APY
  • Compounds interest daily
Learn more

Highlights

  • High APY
  • Compounds interest daily
Capital One logo Capital One 4.00% $0
  • Best 1-Year CD account with no minimum
  • APY as of 11/21/24
  • Variety of CDs available
Learn more

Highlights

  • Best 1-Year CD account with no minimum
  • APY as of 11/21/24
  • Variety of CDs available
Barclays logo Barclays 3.00% $0
  • High APY
  • No minimum opening deposit
Learn more

Highlights

  • High APY
  • No minimum opening deposit
Marcus by Goldman Sachs logo Marcus by Goldman Sachs 3.90% $500
  • Best 2-year CD/Savings account combination
  • Easy-to-meet account minimums
Learn more

Highlights

  • Best 2-year CD/Savings account combination
  • Easy-to-meet account minimums
PenFed logo PenFed 3.65% $1,000
  • High APY
  • Online and physical presence
Learn more

Highlights

  • High APY
  • Online and physical presence
Synchrony logo Synchrony 3.75% $0
  • Best 3-year CD account
  • No minimum deposit
Learn more

Highlights

  • Best 3-year CD account
  • No minimum deposit
Bread Financial logo Bread Financial 3.85% $1,500
  • Best 5-year CD account
  • High APY
Learn more

Highlights

  • Best 5-year CD account
  • High APY
Ally Bank logo Ally Bank 3.50% $0
  • Best bump-up CD
  • Ability to increase APY during term
Learn more

Highlights

  • Best bump-up CD
  • Ability to increase APY during term

How We Determine the Best CD Accounts

SmartAsset analyzed more than 150 CD accounts to create this list. We determined the best CD options based on each of their current APYs and minimum deposits, as well as the customer service of the bank that offers them. Other factors we considered in our analysis were how many other products the bank offers and whether they allow CD laddering. 

Best 1-Year CD Account: Bread Financial

Best 1-Year CD Account: Bread Financial

Bread Financial offers one of the best one-year CD accounts on the market, as it comes with multiple benefits. Customers who open a one-year CD account at Bread Financial will receive a 4.30% APY, which is a great starting point for those who want to save at a faster pace. And as your 1-year CD account continues to grow, your interest will compound daily. 

Bread Financial is flexible with additional CD terms for customers that range from two years at 4.00% to five years at 3.85%. If you want to open an account with the bank, you will need a $1,500 minimum deposit, which is on the higher end for one-year CD terms specifically.

Best 1-Year CD Account With No Minimum: Capital One

Best 1-Year CD Account With No Minimum: Capital One

Capital One is among the nation’s largest banks in terms of consumer deposits, and it now offers one of the best 1-year CD accounts on the market. 

Capital One comes in with a 4.00% APY (as of 11/21/24), and no minimum deposit requirement, which is a great option for a customer beginning their savings journey. As your 1-year CD with Capital One continues to grow, you won’t have to worry about market risk, since CDs aren’t overly attached to short-term market volatility. 

The bank offers additional flexibility for customers with CD terms that range from six months at a 3.90% APY (as of 11/21/24) to five years at a 3.50% APY (as of 9/17/24). Capital One also features one of its highest rates on its 18-month CD, which offers customers a 3.80% APY (as of 11/21/24) with no minimum deposit requirement as well.

Best 2-Year CD Account: Barclays

Best 2-Year CD Account: Barclays

Barclays provides a wide range of certificate of deposit (CD) products, and its high balance CDs really stand out with terms reaching 3.00% APY or higher. Barclays offers 24-month CDs with an APY of 3.00% and no minimum balance is required. That means you don’t need to make a deposit to open the account and you also don’t need to maintain a minimum balance to keep the 3.00% APY. So, once you open a 24-month CD account, you will begin seeing the benefits of the quality rate and interest that compounds daily. 

Barclays offers seven CD terms from 6 months to 60 months. If you are looking to open a 12-month CD, your APY will be a bit higher than the 24-month term at 3.75% with no minimum balance requirements. And if you have your eyes set on a 36-month CD rate, you’ll have access to a great APY of 3.00%. The drawback with Barclays is that it’s an online-only bank here in the U.S. So you have to make sure that you are comfortable with online banking frequently.

Best 2-Year CD/Savings Account Combination: Marcus by Goldman Sachs

Best 2-Year CD/Savings Account Combination: Marcus by Goldman Sachs

If you’re looking to save more, Marcus by Goldman Sachs is one of the best banks to move your money to. The core of its high-interest accounts includes a great CD and savings account combination.

More specifically, Marcus’ 2-year CD has an APY of 3.90%, while its online high-yield savings account boasts an APY of 4.10%. There is no minimum deposit for the savings account, and the CDs call for only a $500 opening deposit.

Where Marcus struggles compared to some of its major competitors is in its customer service. While the bank recently introduced a mobile banking app for Apple and Android devices, its customer support is only available 14 hours a day during the week and 10 hours a day on the weekends. This could make for a frustrating experience if you need help immediately.

Best High Balance 2-Year CD Account: PenFed Credit Union

Best High Balance 2-Year CD Account: PenFed Credit Union

Pentagon Federal Credit Union has a range of different certificate of deposit (CD) offerings, ranging from six months to seven years. 

The minimum on all of these CDs is $1,000. So if you want to open a CD with PenFed, you'll need to have some cash lying around. But if you can meet that minimum, you'll be met with solid APYs, ranging from 3.00% to 3.80%, depending on term length. 

The credit union's 2-year CD APY currently sits at 3.65%, which is one of the highest around. The catch is that you'll need to become a PenFed member in order to open up a CD with the credit union. This used to be a tall order, in that you had to be somewhat involved with the military, either yourself or as a family member or cohabitant. PenFed recently waived this requirement. 

Now, you can become a member and open up a CD just by doing the following: 

  • Be a U.S. citizen or permanent U.S. resident 
  • Have a government-issued photo I.D. 
  • Be at least 18 years old 

If you can meet those requirements, you can easily open an account with PenFed and open a CD account today.

Best 3-Year CD Account: Synchrony

Best 3-Year CD Account: Synchrony

Synchrony, an online- and mobile-only bank, offers one of the best three-year CD terms in the market in the form of a high APY and minimum deposit affordability. Synchrony’s three-year CD presents a great 3.75% APY to help get first-time savers on the right track. For example, an account holder with $5,000 in savings in their initial deposit with a 3.75% APY would be able to earn an additional $583.86 over 36 months.

Synchrony doesn't require a minimum deposit. The bank offers flexible options outside of those in need of a three-year CD. The bank has 16 different CD terms, one of which starts at three months with a 0.25% APY. Other terms range from six months at a 3.90% APY to five years with a 4.00% APY.

Best 5-Year CD Account: Bread Financial

Best 5-Year CD Account: Bread Financial

Bread Financial has a premier five-year CD account that features an incredibly strong 3.85% APY. To put this rate into perspective, if you deposited $10,000 in the account and left it there for five years, you’d walk away with nearly $2,079 in interest earned. This can happen not only because of the great rate, but also because Bread allows balances to compound daily.

If you’re looking to open a five-year CD with Bread, the main stipulation you’ll encounter is a $1,500 minimum opening deposit. This may make the account inaccessible for some prospective account holders. However, in the grand scheme of things, many CDs have higher minimums than this.

Best Bump-Up CD: Ally Bank Raise Your Rate CD

Best Bump-Up CD: Ally Bank Raise Your Rate CD

Ally’s bump-up certificate of deposit is an account that functions like a normal CD, only it allows the account holder to increase their APY during the account’s term should rates rise. So if you own an Ally Raise Your Rate CD, and the interest rate that’s offered for your account goes up, you can initiate a rate increase to take advantage of that benefit. Note that you can only use this option once during the term of your CD, so if rates start to rise, you’ll need to decide the best time to pull the trigger.

This CD comes in two term length variations: two-year and four-year. In both cases, the starting APY is 3.50%. There are no minimum initial deposits for either account, meaning you can take advantage of them regardless of how much you have to invest. There is also a 0.05% APY loyalty reward waiting for any Ally customers that renew their CD to another Ally CD upon maturation.

Once your account’s term matures, you’ll have a 10-day window to withdraw your money. Otherwise, it will be reinvested into the same CD again.

Is a CD the Right Choice for You?

Certificates of deposit (CDs) are a worthwhile investment when market conditions are right. However, you must also be in a solid financial state if you're able to lock up your money for an extended period of time. CDs can be a safe way to grow money, but you must be comfortable not having access to the funds for the duration of the account's term. CDs are worth it when the following circumstances apply:

• Interests rates are high, and you don't expect them to rise significantly over the course of the CD's term.

• You have extra money sitting in a bank account.

• You already have a separate emergency fund in place.

• You are trying to save up for something big, like a home or car, and want to earn a good return without market risk.

• You are looking for ways to grow money without the temptation of spending it.

In low interest rate markets, CDs are less enticing because returns are often fairly miniscule. As interest rates rise however, CDs become a much more attractive method of investing money.

Another advantage of a CD is that your starting rate is guaranteed. Therefore, you cannot lose money with a CD (though you could lose accrued interest if you withdraw money early). This is as opposed to investing in equities and other securities, where you can end up losing your investment if things go poorly. CD deposits also have the backing of FDIC insurance, up to $250,000. So if your banking institution were to fail, you would still be covered.

CDs are a solid option if you have extra money sitting in your accounts, as long as said account is not your emergency fund. Excess cash that is either not accruing interest or accruing low interest could likely be better served in a CD. The fee associated with withdrawing from a CD before the maturity date also acts as a strong deterrent from spending the money you're saving. It makes CDs ideal for anyone trying to save up for something in the long-term.

What CD Term Should You Go With?

It’s important to create a clear set of savings goals when determining the correct CD term for your needs. Opening up a CD and having to withdraw from it early can mean you lose money, so don't open one unless you're sure you won't need the money until the term is up. The penalty can also be great enough where you could have ended up earning more in a liquid savings account, so don't discount the fact that maybe a CD is not the right option at all. You need to be honest about your finances and what your short- and long-term objectives are before committing to a term.

If your goal with a CD is just to grow money in a safe environment, then building a CD ladder with multiple accounts of varying lengths may be the optimal way to go. Laddering $10,000 across five accounts spanning one- to five-year terms can yield you about $1,200 after five years. In comparison, reinvesting $10,000 in a 1-year account for five years (which gives you the same liquidity as the ladder) would yield you about $300 less over the same time frame.

If you have a more focused goal in mind, like saving up for a car or home, you need to determine when you would like to make those purchases and pick the appropriate term. It’s a good idea to consider your job stability in your decision as well. Investing a significant amount of money in a 5-year CD could put you in a bind if you end up needing liquidity before the account matures.

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How Much You Must Save to Send Two Kids to College and Retire on Time

SmartAsset's interactive map highlights places where you can save the least amount of money each month and be able to send your two kids to college and still retire on time. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about cost of living in retirement there as well as savings rate.

Worst
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Rank City Median Household Income Cost of Living in Retirement Cost of Attending College (Two Kids) Savings Rate Monthly Savings

Methodology Many people may feel like they need to choose whether to save for their children's education or their own retirement. But there are some places in the country where you can do both. To find the best places to save for sending two kids to college while still retiring on time, SmartAsset gathered data on three separate regional factors. We looked at median household income, cost of living and the cost of attending college.

We wanted to compare a person in the same situation across many locations in the country. So first, we made several assumptions for the persona of this study. The persona is currently 30 years old, will send two kids to in-state college at the approximate age of 50 and retire by age 65.

Next, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of retirees over the age of 65 throughout the country. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. We reduced this cost of living by the average annual Social Security benefit received by retired workers, as estimated by the Center on Budget and Policy Priorities. The difference is how much money from savings would be needed in each location. Knowing this amount, we were able to calculate the retirement nest egg that a given household will need to cover its cost of living in retirement for thirty years.

According to the Economic Policy Institute, the average amount people have saved by age 30 for their retirement is approximately $35,000. We assumed the monthly amount each household is saving until retirement as well as the $35,000 would grow at a real return (interest minus inflation) of 5%, reflecting the typical return on a conservative investment portfolio comprised of 50% bonds and 50% stocks. We applied this real return to calculate the total amount a household would actually need to accumulate enough savings by age 65 in order to cover the cost of living in retirement.

Then we determined the total cost to send two kids to college using in-state tuition rates. Finally, we calculated a monthly savings total and a savings rate to reach both goals by adding up the monthly amount you would need to save in order to send two kids to college and the amount you would need to build your retirement nest egg by 65. The areas with the lowest amount of savings needed per month are the best places to live in order to send two kids to college and retire on time.

Sources: Bureau of Labor Statistics, Council for Community and Economic Research, College Insight, US Census Bureau 2016 5-Year American Community Survey, Vanguard, Social Security Administration, Economic Policy Institute