In today’s world, with its ups and downs in the market and economic uncertainty, where can smart investors find the best returns on their savings? The answer is in term deposits, also known as certificates of deposit (CDs). But how do you find the best CD rates to make sure you’re getting the most from your savings? Are you sure you’re making the most of your savings?
Key Takeaways
- Discover the top banks offering the highest CD rates, ranging from 4.25% to 5.35% APY1
- Learn about the latest trends in high-yield savings accounts, with APYs reaching as high as 5.27%2
- Understand the impact of Federal Reserve policy on term deposit rates and how to stay ahead of the curve
- Explore the pros and cons of CDs and alternative savings options to find the best fit for your financial goals
- Gain insights into the research methodology used to compile the most up-to-date and reliable term deposit rate information
Best CD Rates from Top Banks
Looking for the best CD rates? Many people check out top banks and credit unions. Popular Direct and America First Credit Union are great examples. They offer some of the best CD rates for different term lengths3.
Popular Direct
Popular Direct is an online bank known for its great CD rates. You need to put in $10,000 to start earning high APYs. For instance, you can get 5.35% on a 6-month CD4. They offer rates from 4.50% to 5.45% on various CDs5.
Thanks to their online-only setup, Popular Direct can give you these great rates. They don’t have physical branches, which saves them money.
America First Credit Union
America First Credit Union is a big name in Utah and some other places. They have a low $500 minimum deposit for CDs. You can get rates from 3 months to 5 years, like 5.15% APY on a 1-year CD3.
They also offer 4.15% APY on a 3-year CD3. Popular Direct and America First Credit Union show how top banks and credit unions offer great CD rates. Using online banking and credit union membership helps you get the most from your savings.
Recent News on CD Rates
The banking industry is buzzing with news about CD rates. The Federal Reserve’s moves have greatly affected CD rates6.
FDIC data shows the average 12-month CD now earns 1.86% as of June 2024, up from 0.13% in January 20226. Two-year and five-year CD rates have also gone up. The best rates for one-year CDs are now over 5.00% APY, and for two-year and five-year CDs, they’re over 4.50% APY6.
The Federal Reserve’s decisions have driven these changes in CD rates7. The central bank raised rates seven times in 2022 and several times in 2023. Now, the federal funds rate is between 5.25% to 5.50%, the highest in over 20 years8. Markets predict the rate could be between 4.50% and 5.25% by December 20246. Yet, there’s almost a 96% chance of a rate cut by year’s end6.
CD rates change with the federal funds rate6. Data from 2009 to 2023 shows how CD rates react to policy changes, inflation, and economic trends6. During the pandemic, the Federal Reserve lowered the federal funds rate to help the economy, affecting CD rates6.
As the banking industry changes, people are watching CD rates closely to get the best returns7. The latest news on CD rates shows why it’s key to stay updated and make smart choices with savings6.
| CD Term | Average APY | Competitive Rates |
|---|---|---|
| 6 months | 5.24% | 5.13% – 5.35% |
| 1 year | 5.28% | 5.25% – 5.30% |
| 3 years | 4.46% | 4.30% – 4.61% |
| 5 years | 4.35% | 4.20% – 4.50% |
The table shows the current CD rates, including the national average and competitive rates from banks7. This info helps people pick the best CD for their needs6.
The latest on CD rates shows how the banking world changes and why staying informed is key. By watching these trends, people can get the best returns on their savings6.
Current Promotional CD Rates
Today, smart savers are looking for the best promotional CD rates and limited-time CD offers. California Coast Credit Union offers a great chance with its high-yield CD special, the Celebration Certificate9.
California Coast Credit Union Celebration Certificate
The California Coast Credit Union Celebration Certificate has a great 9.50% APY for a 5-month term9. This special deal aims to boost savings but has certain rules. To get it, you need a $500 to $3,000 deposit and an active account or new money at the credit union9.
This California Coast Credit Union CD rate is much higher than many others. But, it’s key to check if you qualify before jumping in9.
If you can grab this offer, the Celebration Certificate from California Coast Credit Union is a great way to grow your savings. It offers a standout promotional CD rate in today’s market9.
Compare top CD rates today by term
When you want to grow your savings, it’s key to look at CD rates by term. CDs are a solid choice for saving money, and the rates change based on how long you keep your money locked in. Let’s explore some of the best CD rates for different terms.
For short-term savings, Barclays Online CD offers a 5.00% APY for a year with no minimum deposit10. Discover® Bank also has a great 1.5-year CD with a 4.40% APY, needing a $2,500 deposit10.
Looking at 1-year CDs, Western Alliance Bank has a top 5.25% APY with a low $1 deposit10. Quontic CD and LendingClub CD also offer strong rates of 4.50% and 4.20% APY, with $500 and $2,500 minimums, respectively10.
For 6-month CDs, Synchrony Online CD has a competitive 4.80% APY with no minimum deposit10. Marcus by Goldman Sachs High Yield CD also offers a 4.60% APY for 1.5 years, with a $500 deposit10.
| Bank | CD Term | APY | Minimum Deposit |
|---|---|---|---|
| Barclays Online CD | 1 year | 5.00% | $0 |
| Discover® Bank CD | 1.5 year | 4.40% | $2,500 |
| Western Alliance Bank CD | 1 year | 5.25% | $1 |
| Quontic CD | 1 year | 4.50% | $500 |
| LendingClub CD | 1 year | 4.20% | $2,500 |
| Synchrony Online CD | 6 months | 4.80% | $0 |
| Marcus by Goldman Sachs High Yield CD | 1.5 year | 4.60% | $500 |
These examples show some of the best CD rates today. By comparing rates by term, you can pick the best option for your savings goals10.
term deposit rates
People looking to grow their money are turning to term deposit rates. Climate First Bank and TotalDirectBank offer great options. Let’s look at what they have to offer and the benefits for smart investors.
Climate First Bank 6 Month No Penalty CD
Climate First Bank’s 6 Month No Penalty CD is a great choice for those who want flexibility and good rates. It doesn’t have early withdrawal fees11. This is perfect for people who might need their money soon but still want to earn interest.
TotalDirectBank 3 Month CD and TotalDirectBank 6 Month CD
TotalDirectBank has two short-term CD options for those with more savings. The 3 Month and 6 Month CDs have high interest rates and a $25,000 minimum deposit12. They’re for people who can keep their money locked in for a bit longer to earn more.
Remember, the rates from these banks can change due to market shifts and rules13. It’s key to keep up with rate changes and compare options to make smart choices for your money goals.
If you want the ease of a no-penalty CD or the chance for higher returns with a short-term CD, consider Climate First Bank and TotalDirectBank. These options can help you save better and plan for a brighter future111213.
How to choose the best CD for you
Choosing the right CD means looking at several key factors. The term length is crucial, ranging from 3 months to over 5 years14. Think about when you need your money and how long you can keep it in the CD to pick the best term.
Also, consider the minimum deposit needed. Some CDs don’t require any money, while others ask for $100,000 or more1415. Make sure you have enough money and know how it fits with your investment goals.
Don’t forget about early withdrawal penalties. These can be steep, especially for longer terms1416. Think about how often you might need your money and the cost of getting it back early.
Online-only banks often have higher CD rates14. This makes them a good choice for those wanting to earn more. CD laddering16 is another strategy to consider. It lets you have access to money when you need it while still earning top rates.
When picking a CD, weigh factors like term length, minimum deposit, and penalties against your financial goals and how much risk you can take14. By considering these, you can choose a CD that meets your savings goals. Explore different CD types15 like no-penalty, add-on, and IRA CDs to find what’s best for you141615.
Who should get a CD?
A Certificate of Deposit (CD) is a good choice for some people with specific financial goals17. These accounts offer rates that are often three to four times higher than the average17. They’ve seen a big increase in rates from 2021 to 202317. So, who should consider a CD, and how can it help them save money?
CDs work best for those with a clear savings goal and a long-term plan17. They’re great for saving for a house, education, or retirement17. The Federal Reserve’s actions affect CD rates17. The Federal Open Market Committee changes rates every six to eight weeks, which impacts CD rates17.
People who prefer a safe investment might like CDs more than stocks17. Jumbo CDs with higher deposits offer better rates, but not always17. It’s important to compare rates from banks and credit unions to find the best deal17.
CDs also offer protection for your money17. Up to $250,000 is insured by the FDIC or NCUA if a bank fails17. Spreading your money across different banks helps protect more than $250,00017.
CDs are a good fit for many savers, from young people to retirees18. Forbes Advisor looked at 142 CD accounts from 84 institutions18. Higher rates and better features ranked higher on the list18. Understanding CDs can help you see if they fit your financial goals and risk level.
In summary, CDs are great for those with specific savings goals, a long-term plan, and a preference for low risk. They offer a guaranteed return, FDIC/NCUA protection, and higher rates than traditional savings accounts. This makes them a solid choice for many savers.
“CD rates are some of the highest they’ve been in over a decade, ranging from 4% to nearly 6%.”19
| Factors to Consider for CD Investors | Impact on CD Suitability |
|---|---|
| Savings Goal | CDs are well-suited for those with specific savings objectives, such as a down payment, education, or retirement. |
| Investment Horizon | CDs are better suited for those with a longer investment timeline, as early withdrawal penalties may apply. |
| Risk Tolerance | CDs offer a lower-risk alternative for those seeking a more stable and predictable return on their investments. |
| Deposit Protection | Up to $250,000 in CD deposits are insured by the FDIC or NCUA, providing a safeguard for investors. |
| CD Rates | CD rates have risen significantly in recent years, making them a more attractive option for savers. |
By looking at these factors, you can decide if a CD is right for you18. The Forbes Advisor analysis shows the importance of checking APY, deposit requirements, and interest schedules when picking a CD18.
Pros and Cons of CDs
Certificates of Deposit (CDs) are a popular way to save money. They offer both advantages and drawbacks. On the plus side, CDs give a secure and predictable return, with APYs from 2.00% to 4.70% for Discover® Certificates of Deposit20. You need to put in at least $2,500, and they come in terms from 3 months to 10 years20. Plus, they’re insured by the FDIC up to $250,000, making your savings safe20.
But, CDs also have downsides. One big issue is their lack of liquidity. Taking out your money early usually means losing some interest, often for several months21. This can be a big problem if you need your money fast. Also, CDs don’t let you take advantage of rising interest rates because their rates are fixed for the term20.
Another thing to think about is the opportunity cost of using CDs. They might offer higher interest than regular savings accounts22. But, they might not beat inflation or grow as much as other investments, like stocks20. This is something to consider if you’re looking at CDs for long-term goals.
Deciding on a CD should match your financial goals, how much risk you can handle, and how quickly you might need your money. CDs can be good for short-term saving or adding to a mix of investments. But, it’s key to look at the pros and cons to see if they’re right for you21.
“Certificates of Deposit can be a great way to earn a guaranteed return on your savings, but it’s important to consider the limitations and potential drawbacks before investing.”
Knowing the advantages of CDs, like their safety and steady returns, and the disadvantages of CDs, like limited access and costs, helps you decide if they fit your financial plans and how much risk you’re okay with222021.
Alternatives to CDs
With rising interest rates, investors might look beyond traditional certificates of deposit (CDs) for better returns. CDs are still good for those who prefer low risk. But, there are other savings options that could offer more competitive rates and flexibility23.
High-yield savings accounts are a good choice. They can earn up to 5.40%, much higher than the usual 0.59% for regular savings accounts24. Money market accounts also offer attractive rates, reaching up to 5.25%24.
For those ready for a bit more risk, short-term bonds or treasury bills could be an option. Since 2012, five-year municipal bonds have only defaulted 0.1% of the time23. Corporate bonds have seen a 7.2% default rate23. Series I savings bonds offer a fixed 0.30% plus a variable rate tied to inflation, for a total yield of 4.30%23.
When looking at these options, think about liquidity, how much risk you can handle, and how long you plan to invest. CDs lock in a fixed rate for the term, unlike I bonds and high-yield savings accounts which can have variable rates23. It’s important to balance yield, risk, and access to find what suits your financial goals2324.,
By looking at a wider range of alternatives, investors can potentially increase their savings and returns. This helps diversify their portfolio beyond just traditional deposit products232425.,,
Research Methodology
Our team works hard to give you the latest and most accurate term deposit rate info. We keep an eye on over 100 financial institutions for changes in interest rates. This ensures the info we share is up-to-date and reflects the market26.
We get our data from direct bank partnerships and our own rate surveys. This lets us see how rates have changed over time and compare them to national averages. We use this info to find the best CD rates and track market trends27.
We look at how interest rates affect deposits and how accounts stay or switch. This helps us make predictions and give advice on managing risks27.
Since March 2022 to September 2023, the impact of changing interest rates has been huge. It’s like adding $4.5 trillion in 10-year Treasury securities to bank balance sheets. Most of this is from discounting and 40% from dynamic betas28.
Our detailed research and focus on transparency help our readers make smart choices about their savings. This article covers everything from the latest CD rates to strategic tips. It’s all to help you save more2627.
Conclusion
We’ve looked into term deposit rates and shared key insights to help you save more. We talked about how CDs from top banks and credit unions can offer better interest rates29. We also covered how you can choose between different payout options and the risks of taking out your money early29.
Choosing the right CD means thinking about your need for easy access to money, how much risk you can handle, and how inflation and interest rates might change30. By keeping up with market trends and special rates, you can make choices that fit your financial situation30. CDs are great for short-term savings, but other investments might be better for long-term growth31.
We suggest keeping an eye on term deposit rates and finding the best deals to save more. By working with your bank and following market news, you can make sure your savings grow. The goal is to find a balance between easy access, risk, and returns. This article has shown how term deposit rates can help you achieve that balance.
FAQ
What are the best CD rates from top banks?
What is the latest news on CD rates?
What are some current promotional CD offers?
How can I compare the top CD rates today by term?
What are some specific term deposit rates highlighted in the article?
How do I choose the best CD for my needs?
Who can benefit the most from opening a CD?
What are the pros and cons of investing in CDs?
What are the alternatives to CDs for high-yield savings?
What is the research methodology used to gather the information in the article?
Source Links
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- These are the absolute best savings accounts available today (5% APY and up) – https://fortune.com/recommends/banking/best-savings-accounts/
- Want a risk-free investment that earns you more than 5% a year? Try these CDs. – https://fortune.com/recommends/banking/the-best-cd-rates/
- Best CD Rates for July 2024: Up to 6.00% APY – https://www.investopedia.com/best-cd-rates-4770214
- 11 best CD rates of July 2024 (up to 5.30% APY) – https://www.cnbc.com/select/best-certificates-of-deposits/
- CD Interest Rates Forecast: Will CD Rates Go Up In 2024? – https://www.forbes.com/advisor/banking/cds/cd-rate-forecast/
- Current CD Rates For July 2024 | Bankrate – https://www.bankrate.com/banking/cds/current-cd-interest-rates/
- What Fed Rate Decisions in 2024 Mean for CDs – NerdWallet – https://www.nerdwallet.com/article/banking/cds-fed-rate-increase
- Synchrony Bank CDs – https://www.marketwatch.com/guides/cds/best-cd-rates/
- Best CD Rates July 2024: Highest Rates Today – https://www.fool.com/the-ascent/banks/cds/best-cd-rates/
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- Certificate of Deposit – View CD Rates and Account Options – https://www.bankofamerica.com/deposits/bank-cds/cd-accounts/
- National Rates and Rate Caps – https://www.fdic.gov/resources/bankers/national-rates/index.html
- Top Tips For Choosing The Best CD For Your Money | Bankrate – https://www.bankrate.com/banking/cds/top-tips-for-choosing-best-cd/
- 9 Types of CDs: Which Should You Choose? – NerdWallet – https://www.nerdwallet.com/article/banking/types-of-cds
- How to Pick the Right CD Term for Your Needs – https://www.investopedia.com/how-to-pick-the-right-cd-term-for-your-needs-5224203
- What Is a Certificate of Deposit (CD)? Pros and Cons – https://www.investopedia.com/terms/c/certificateofdeposit.asp
- Best CD Rates Of July 2024: Up To 5.30% – https://www.forbes.com/advisor/banking/cds/best-cd-rates/
- Should You Lock in Today’s CD Rates? – https://www.wsj.com/buyside/personal-finance/banking/should-you-lock-in-todays-cd-rates
- Pros And Cons Of Using A Certificate Of Deposit (CD) For Your Savings – https://www.forbes.com/advisor/banking/pros-and-cons-of-using-a-certificate-of-deposit-cd-for-your-savings/
- Pros and Cons of CDs – https://www.investopedia.com/pros-and-cons-of-cds-5223947
- The Pros and Cons of CDs – Experian – https://www.experian.com/blogs/ask-experian/pros-cons-cds/
- Alternatives to CDs – https://www.cnet.com/personal-finance/banking/advice/alternatives-to-cds/
- 3 Alternatives to CDs – Experian – https://www.experian.com/blogs/ask-experian/3-alternatives-to-cds/
- Should you put your money in a long-term CD or invest it? Here’s what to consider – https://www.cnbc.com/select/save-money-in-long-term-cd-or-invest/
- Term Deposit: Definition, How It’s Used, Rates, and How to Invest – https://www.investopedia.com/terms/t/termdeposit.asp
- Why is a Core Deposit Study So Important? – https://www.envisant.com/blog/why-is-a-core-deposit-study-so-important/
- Deposit Convexity, Monetary Policy and Financial Stability – Research Dept. Working Paper No. 2315 – Dallas Fed – https://www.dallasfed.org/-/media/documents/research/papers/2023/wp2315.pdf
- Fixed Deposits vs. Term Deposits: Are they different? – https://kuvera.in/blog/fixed-deposits-vs-term-deposits-are-they-different/
- Understanding How a Term Deposit Works – https://smartasset.com/financial-advisor/understanding-how-a-term-deposit-works
- Term Deposits: Are They Worth It? | Lighthouse Financial – https://lighthousefinancial.co.nz/podcasts/term-deposits/