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4 Best 3-Month CD Rates July 2020
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Three-month CD rates aren't that common, but of those available, online banks tend to have the best. Although the term is one of the shortest available, these CDs can be helpful in some savings strategies.
Three-month CD rates aren't that common, but of those available, online banks tend to have the best. Although the term is one of the shortest available, these CDs can be helpful in some savings strategies.
Summary of Best 3-Month CD Rates July 2020
| Bank | NerdWallet Rating | APY | Minimum Deposit | Learn More |
|---|---|---|---|---|
0.50% | $0 | Read review | ||
0.45% | $5,000 | Read review | ||
0.35% | $1 | Read review | ||
0.35% | $250 | Read review |
Ally Bank CD
APY
With $0 minimum balance
Minimum Balance
Member FDIC
TIAA Bank CD
APY
With $5000 minimum balance
Minimum Balance
Member FDIC
Barclays CD
APY
With $1 minimum balance
Minimum Balance
Member FDIC
Consumers Credit Union CD
APY
With $250 minimum balance
Minimum Balance
Federally insured by the NCUA
» Want to see more options? Check our list of the best CD rates overall
Here's our list of the best 3-month CD rates from banks and credit unions:
Barclays: 0.35% APY, no minimum deposit.
Consumers Credit Union: 0.35% APY, $250 minimum deposit.
TIAA Bank: 0.45% APY, $5,000 minimum deposit.
Ally Bank: 0.50% APY, no minimum deposit.
Last updated on July 1, 2020
Methodology
We featured easy-to-join financial institutions that NerdWallet has vetted and reviewed with the highest rates for three-month CDs. Higher rates might be available elsewhere.
To recap our selections...
NerdWallet's Best 3-Month CD Rates July 2020
- Ally Bank CD: 0.50% APY
- TIAA Bank CD: 0.45% APY
- Barclays CD: 0.35% APY
- Consumers Credit Union CD: 0.35% APY
Frequently asked questions
The benefit of a 3-month CD is that you can take advantage of multiple renewals in one year. You have more access to funds than other CDs while still taking advantage of a fixed rate.
You could also build a short-term CD ladder, which might look like this: Open a 3-month, 6-month, 9-month and 1-year CD; when each one matures, open a new 1-year CD. You can end up with four CDs maturing in the second year, or withdraw funds at any maturity if you need them.
No. The Federal Reserve cut rates in March 2020, which encouraged banks and credit unions to lower their CD rates. Rates are likely to continue falling before they go up again. For more context, see our explainer on historical CD rates.
You should get a CD only if you know you won’t need those funds during its term. Pulling money out of a CD before its expiration date will likely result in an early withdrawal fee, which is typically a percentage of the interest earned. With a three-month CD, there’s less of a commitment, so you have more opportunities to renew in a given year if you decide you don’t need the money yet. If you're thinking of a longer term for higher yields, check out our lists of best one-year and best three-year CD rates.
It depends on your savings goals and how sure you are that you won't need your funds before the CD term expires. Having to pay an early withdrawal penalty, generally up to one year's worth of interest, can be a blow to your savings. Common CD terms range from three months to five years; if you want to play it safe, go for a shorter CD term or a no-penalty CD.
A no-penalty CD is a type of CD that doesn’t charge a penalty for withdrawing money before the term ends. It can be appealing if you want the traditionally higher yield of a CD, compared to regular savings accounts, and think you might need the money sooner than planned. See the best no-penalty CD rates.
CD rates are quoted as an annual percentage yield, or APY, which is how much the account earns in one year, including compound interest. Banks generally compound interest monthly or daily. Most CDs have fixed rates, so they won't change as savings account rates tend to.
It depends on what's more important to you: rates or access to your money. The best CD rates tend to be higher than the best savings account rates, but you sacrifice access to money in CDs. If that doesn't work for you, check out our list of best online savings accounts.
A CD, or certificate of deposit, is a type of savings account that keeps money locked up for a set period, or term, generally three months to five years. The longer the CD term, the higher the rate tends to be. See this month’s top three-month CD rates.
It depends on the level of risk you want to take. Investment, or brokerage, accounts can have higher returns than CDs, but CDs guarantee returns. They're typically federally insured for up to $250,000 and offer fixed interest rates. Brokerage accounts can be riskier since you aren’t protected against losses. See this month’s top three-month CD rates.
No. CDs are meant for savings you can set aside and leave untouched. Consider a high-yield savings account for money you may need in a pinch.
A CD ladder can be a helpful strategy if you don’t want to go all in on one CD, especially if you want to catch higher CD rates down the road. It works like this: You open multiple CDs at different terms, such as three months, six months, and one year, which frees up part of your funds more regularly than having, say, just a three-year CD. Each time a CD matures, you can either reinvest in a new CD or withdraw your money.
