Written by
Marcos Cabello
Marcos Cabello is a banking writer at Bankrate, where he’s dedicated to helping readers make the best decisions about their finances. Previously, Marcos wrote about money for CNET and NextAdvisor, running the gamut of personal finance topics including U.S. economic policy and cryptocurrency.
Edited by
Marc Wojno
Marc Wojno is a seasoned and accomplished finance editor and writer with more than two decades of experience editing and writing across a variety of news platforms including newswires, newsletters, magazines and online news sites.
Interest rates on certificates of deposit (CDs) have skyrocketed in recent years. Some banks are offering CDs with annual percentage yields (APYs) that are even outpacing inflation. With so many options out there, it's hard to know which is right for you. If you're a New York resident looking to open a CD, here's what you need to know.
At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict editorial integrity, this post may contain references to products from our partners. Here’s an explanation for how we make money. Learn more about who we are and our promise to guide you through life’s financial journey.
Advertiser DisclosureWe are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free - so that you can make financial decisions with confidence.
Bankrate has partnerships with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover.
The offers that appear on this site are from companies that compensate us. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories, except where prohibited by law for our mortgage, home equity and other home lending products. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you.
The following accounts can be found at most banks and credit unions. They’re federally insured for up to $250,000 and offer a safe place to put your money while earning interest.
Certificate of Deposit (CD)CDs are best for individuals looking for a guaranteed rate of return that’s typically higher than a savings account. In exchange for a higher rate, funds are tied up for a set period of time and early withdrawal penalties may apply.
Checking accountChecking accounts are best for individuals who want to keep their money safe while still having easy, day-to-day access to their funds. ATM and other transactional fees may apply.
Savings / Money Market Accounts (MMA)Savings and MMAs are good options for individuals looking to save for shorter-term goals. They’re a safe way to separate your savings from everyday cash, but may require larger minimum balances and have transfer limitations.
Deposit amount Current 1 year CD trends Bankrate Partner average National averageThe "Bankrate Partner average" is calculated from the average of the top savings account offers from the institutions we track, included on this page as of 9/5/2024. "National average" is determined by Bankrate's comprehensive national survey of savings accounts and CDs.
No penalty CD rates
Min. term length Max. term lengthThere are three main components you should consider when choosing a CD: the term length, the yield and the penalty for early withdrawal.
A CD term is the length of time your money is slated to stay within the account. Terms typically range anywhere from three months to five years, though some banks offer terms as short as seven days to as long as 10 years, even longer than a decade. To find the right term for you, consider how long you can park your cash in the account without needing to withdraw it. Unless you're opening a no-penalty CD, you'll likely need to pay a penalty for withdrawing your money before the CD's maturity date.
You'll also want to consider the minimum opening deposit when choosing your term. While some banks don't have a minimum deposit requirement, others may ask for a relatively standard $500 or $1,000 minimum deposit. If you're interested in a jumbo CD, you'll typically need $100,000 to open an account.
Getting the best yield is probably the most important factor for most consumers when choosing a CD. Thanks to historic interest rate hikes by the U.S. Federal Reserve, yields on CD rates have soared over the last three years. Top-notch rates for CDs surpass five percent APY in today's market, but not all institutions are offering yields that high. In general, big institutions are still offering lackluster rates compared with online-only banks like Ally Bank and Marcus by Goldman Sachs.
But choosing a CD based solely on the highest yield may not always be the right move. If you suspect you may need to withdraw your money before a CD matures, you'll likely need to pay an early withdrawal penalty, which could even eat at some of your principal (the money you originally invest in a CD).
Banks typically impose an early withdrawal penalty if you withdraw some or all of the principal before a CD matures. Early withdrawal penalties range widely from bank to bank. A relatively standard early withdrawal penalty for a 12-month CD could range anywhere from three to six months of interest. And some banks may even impose a flat fee on top of that penalty, further ratcheting up the cost of withdrawing from a CD before maturity.
Here, you'll want to consider your risk tolerance, balancing the term and the yield with the associated penalty. If you're more likely than not to withdraw early, you may want to consider a CD with a lower yield but a softer penalty.
Whether to invest in a short-term or long-term CD is dependent on your financial situation.
