Best CD Rates for January 2023

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Investing in a CD can help you achieve your savings goals. Here’s our list of the best CD rates you can find from the many banks out there.

There are many ways to save money these days and earn interest from the funds you set aside. In addition to high-yield savings accounts, certificates of deposit (CDs) can help you earn interest on your savings to put those dollars to work. Many banks and credit unions offer CDs at a fixed interest rate for a specific amount of time. Those looking to make the most of their CDs should find the best rates, but even doing that can be a hassle. 

We’ve put together this guide on the best CD rates to help you find out where your money works the hardest for you. At the same time, it’s not all about the rates. You should consider other aspects of the CD to find the best fit for your situation. Use our checklist below to see what you should look for in a CD account that may or may not offer the best rate in town. 

Are you ready to see who offers the best CD rates? Let’s get started! 

13 Best CD Rates for 2023

These banks offer some of the best CD rates at the time of writing this article. While most banks will offer both longer and shorter terms, you’ll get the best return on investment for your time by choosing the specified rate within each listing. 

1. Alliant Credit Union

This credit union offers one of the best interest rates on our list. Alliant Credit Union offers you the chance to earn 4.5% APY on your balance, as long as you qualify for membership (typical of credit unions vs. banks). You’ll get the most bang for your buck if you choose a three-year term, but you’ll need at least $1,000 to get started. Terms range from 12 months to five years, with tiered withdrawal penalties. You can also take advantage of dividend withdrawals, which allow you to collect interest each month penalty-free instead of letting it compound. 

2. Ally Bank

With a 4.25% APY interest rate and no minimum deposit, it’s not hard to see why Ally Bank made our list. Though you’ll get the best rate if you choose an 18-month term, you can pick between a short three-month CD to a five-year-long CD. This bank is online-only but serves over 8.5 million customers. Ally Bank compounds your interest daily, and there’s a bonus APY if you renew your CD once the term is up. 

In addition, you can pick one of three CDs. The first is the Ally High Yield Certificate of Deposit, which is anywhere from three months in a term to five years. This is the most basic CD, compared to the Raise Your Rate Certificate of Deposit, which is two or four years per term. You can also choose the No Penalty CD. This one holds a term of 11 months and allows you to withdraw at any time after six days of funding it. 

3. American Express National Bank

AmEx is beloved by many, especially since they’ve been operating since 1950. This bank offers a 4.25% APY with no minimum deposit or fees. The rates will depend on which terms you choose but range from six months to five years. Interest is paid out each month but compounded daily, making a CD from AmEx National Bank a smart short-term investment

4. Barclays

This UK-based bank requires no minimum to fund the CD, which earns a 4.35% APY interest rate. Terms come anywhere from three to 60 months, but you’d be wise to choose a term longer than nine months to maximize your return. You can also use the CD Calculator from Barclays to see what you’d get. 

5. Bread Financial

Since 1986, this Utah-based bank has been offering its customers some of the best banking services. Open a CD online with Bread Financial to earn 4.50% APY, as long as you have a $1,500 minimum deposit. The terms range from one to five years and interest is compounded daily. There are no monthly fees and your CD renews automatically once it reaches maturity. Within the 10-day grace period between the end of the first term and the beginning of the second, you can withdraw your funds if you’d like. 

6. Capital One

High interest rates continue with Capital One. This bank has been public since 1994 and offers terms from six months to five years. As part of a long-term investment strategy, you can earn up to 4.40% APY with no minimum deposit with Capital One. There are no partial withdrawals. If you do pull your funds out early, you’ll pay a penalty of at least three months’ worth of dividends if your term is shorter than a year. This doubles to six months if your terms are longer. 

7. Connexus Credit Union 

For one of the higher CD rates in the nation, check out Connexus Credit Union. The longest term CD here is five years but you can also choose as low as a one-year term and still get the 4.51% APY rate. You’ll need at least $5,000 to fund the CD but you don’t have to have a checking account open to fund it. Early withdrawals will incur penalties. Check out Connexus Credit Union for other credit union promotions you can take advantage of. 

8. Discover 

To access the 4.40% APY rate from Discover, you’ll need to fund your new CD with at least $2,500 to start. Discover offers terms starting at three months and extending to 10 years, but there’s no real advantage to going with 10 years over 5 years. With no fees and the ability to set up a CD ladder, Discover offers comparable rates to other banks and credit unions on our list. 

9. LendingClub Bank

Choose terms from three months to five years when you open a LendingClub Bank CD with at least $2,500 to start. You’ll have a chance at the 4.10% APY interest rate, which requires you to open an account online. If you’re looking for a way to invest $700 or more for a long-term payoff, check out LendingClub Bank. 

10. Marcus by Goldman Sachs

With a $500 deposit, you can earn up to 4.40% APY with a CD from Marcus by Goldman Sachs. This CD can run anywhere from six months to six years, but you’ll only get the high APY if you fund your account within the first 10 days. This CD automatically renews, like many others, with the same 10-day grace period for withdrawal. Did you know Goldman Sachs has been in the business for over 150 years? 

11. Navy Federal Credit Union

As long as you qualify for membership, you can earn up to 3.40% APY with Navy Federal Credit Union (NFCU). This credit union restricts membership to the armed forces, Department of Defense, veterans, and their families, but currently holds over 10 million members. NFCU offers the Standard, EasyStart, and SaveFirst CDs, which range in terms from three months to seven years. SaveFirst is basic, requiring $5 to open. You can add money to your CD with EasyStart and SaveFirst CDs, though you’ll need $50 to fund your EasyStart CD and $1,000 to fund the Standard CD. 

12. Sallie Mae Bank

This well-known bank offers CDs that automatically renew as well. You’ll still get that 10-day grace period to withdraw your funds, but with a high APY of 4.4%, why would you? You can choose terms from six months to five years, but you’ll need at least $2,500 to deposit into the account first. Interest does compound daily for this CD, and is paid out monthly. 

13. Synchrony 

To earn a 4.50% APY on your CD, check out Synchrony. This secure online bank does have four physical locations but does most of its business on the web. Terms range from three months to five years, but there’s no minimum deposit. Funds are FDIC-insured and you can choose from both fixed and variable-rate CDs to fit your goals.  

What is a Certificate of Deposit (CD)

Banks offer certificates of deposit as a way for members to earn interest. Most CDs require individuals to lend their funds to the bank for an extended period. During this time, however, the individual earns interest on their balance. Most CD rates range anywhere from a small percentage to a nearly 5% APY. In comparison to other types of investments, CDs have a lower return rate, but they can be incredibly steady and reliable as well. The best portfolios incorporate CDs along with high-risk investments to offset any losses. 

CDs differ from savings accounts in key ways. For example, banks allow you to withdraw funds from savings accounts without penalty, as long as you only do it so many times per statement period. CDs, however, typically don’t allow for withdrawals without a penalty. Think of CDs as a suitcase that holds your savings that’s locked away like a time capsule until a future date when you can access it. 

In addition, though savings accounts and CDs are both low risk, they do tend to vary in terms of APY rates. Savings account rates depend on market fluctuations while many CDs allow you to lock in your interest rate from the very beginning. Smart investors tend to open CDs when interest rates are high as still part of the low-risk investment portion of their portfolio. 

What to Look for in a CD

When shopping for a certificate of deposit, it is important to consider a few key factors to ensure that you find the best option for your needs. Some things to look for in a CD include:

  • Competitive interest rates: CD rates can vary significantly from one financial institution to another, so it is important to compare interest rates from multiple sources to find the best deal.
  • Term length: CDs are typically available with terms ranging from a few months to several years. Choose a term that aligns with your financial goals and timeframe.
  • Minimum deposit requirements: Some CDs may have minimum deposit requirements that may be higher than you are comfortable with. Consider your available funds and choose a CD with a minimum deposit that works for you.
  • Early withdrawal penalties: If you need to access your money before the CD matures, you may be subject to early withdrawal penalties. Be sure to understand the terms and conditions of your CD before committing to it.
  • FDIC insurance: CDs offered by FDIC-insured banks are insured up to $250,000 per depositor, which can provide added security for your investment.

By considering these factors, you can find a CD that meets your financial needs and helps you reach your savings goals.

FAQs

What types of CD rates are there? 

CDs can be fixed or variable when it comes to interest rates. As the terms imply, fixed rates stay the same throughout the life of the CD, while variable rates respond to and mirror the market. Many investors favor fixed rates to lock in a higher and more profitable rate, while others prefer the volatility of variable rates as a way to potentially earn more for their investments.

Do you get a higher interest rate if you opt for a longer-term CD?

It’s often true that you get a higher interest rate if you obtain a longer-term CD, but this is not always the case. If you’d like to compare the rates between terms, check the fine print. 

Which banks offer the best CD rates? 

The banks on our list offer some of the best CD rates out there. While they’re not spectacular considering the bank or credit union is using your money to invest in other things, it’s certainly better than nothing. These rates may change in response to the economy as well, depending on what happens. 

Cash in On a CD Today

While certificates of deposit certainly aren’t the most interesting type of investment, they can be a great way to earn interest, slowly but surely. We hope you’ve found this article useful in figuring out which banks and credit unions offer the best CD rates so you can make the most of your money. The higher the interest rate you can obtain, the more you’ll get paid for the use of your money. That is until you come back to claim it in the future.

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About the author

Brian Meiggs
Brian Meiggs
Brian Meiggs is a personal finance expert, and the founder of My Millennial Guide, a personal finance site helping you put more money in your pocket. He helps millennials follow the smart money in order to increase their earning potential and start building wealth for the future. He regularly writes about side hustles, investing, and general personal finance topics aimed to help anyone earn more, pay off debt, and reach financial freedom. He has been quoted as a top personal finance blogger in major publications including Yahoo! Finance, NASDAQ, Discover, MSN Money and more.
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