Best of

10 Best CD Rates for August 2019

Spencer TierneyAugust 1, 2019

At NerdWallet, we strive to help you make financial decisions with confidence. To do this, many or all of the products featured here are from our partners. However, this doesn’t influence our evaluations. Our opinions are our own.

Summary of 10 Best CD Rates for August 2019

Bank1-year APY3-year APY5-year APYMinimum DepositLearn More
Discover

Discover

at Discover,

Member, FDIC

2.40%

2.45%

2.50%

$2,500

at Discover,

Member, FDIC

Popular Direct

Popular Direct

2.25%

2.40%

2.55%

$10,000

Connexus Credit Union

Connexus Credit Union

2.20%

2.50%

2.60%

$5,000

Alliant Credit Union

Alliant Credit Union

2.35%

2.45%

2.55%

$1,000

TIAA Bank

TIAA Bank

2.40%

2.50%

2.60%

$5,000

Citizens Access

Citizens Access

2.50%

2.60%

2.70%

$5,000

Synchrony Bank

Synchrony Bank

2.45%

2.55%

2.65%

$2,000

Barclays

Barclays

2.40%

2.50%

2.60%

$0

Sallie Mae Bank

Sallie Mae Bank

2.45%

2.50%

2.50%

$2,500

Goldman Sachs Bank USA

Goldman Sachs Bank USA

at Goldman Sachs Bank USA,

Member, FDIC

2.40%

2.50%

2.60%

$500

at Goldman Sachs Bank USA,

Member, FDIC

Bank1-year APY3-year APY5-year APYMinimum DepositLearn More
Discover

Discover

at Discover,

Member, FDIC

2.40%

2.45%

2.50%

$2,500

at Discover,

Member, FDIC

Popular Direct

Popular Direct

2.25%

2.40%

2.55%

$10,000

Connexus Credit Union

Connexus Credit Union

2.20%

2.50%

2.60%

$5,000

Alliant Credit Union

Alliant Credit Union

2.35%

2.45%

2.55%

$1,000

TIAA Bank

TIAA Bank

2.40%

2.50%

2.60%

$5,000

Citizens Access

Citizens Access

2.50%

2.60%

2.70%

$5,000

Synchrony Bank

Synchrony Bank

2.45%

2.55%

2.65%

$2,000

Barclays

Barclays

2.40%

2.50%

2.60%

$0

Sallie Mae Bank

Sallie Mae Bank

2.45%

2.50%

2.50%

$2,500

Goldman Sachs Bank USA

Goldman Sachs Bank USA

at Goldman Sachs Bank USA,

Member, FDIC

2.40%

2.50%

2.60%

$500

at Goldman Sachs Bank USA,

Member, FDIC

Discover

at Discover,

Member, FDIC

at Discover,

Member, FDIC

1-year APY

2.40%

3-year APY

2.45%

5-year APY

2.50%

Minimum Deposit

$2,500

1-year APY

2.25%

3-year APY

2.40%

5-year APY

2.55%

Minimum Deposit

$10,000

1-year APY

2.20%

3-year APY

2.50%

5-year APY

2.60%

Minimum Deposit

$5,000

1-year APY

2.35%

3-year APY

2.45%

5-year APY

2.55%

Minimum Deposit

$1,000

1-year APY

2.40%

3-year APY

2.50%

5-year APY

2.60%

Minimum Deposit

$5,000

1-year APY

2.50%

3-year APY

2.60%

5-year APY

2.70%

Minimum Deposit

$5,000

1-year APY

2.45%

3-year APY

2.55%

5-year APY

2.65%

Minimum Deposit

$2,000

1-year APY

2.40%

3-year APY

2.50%

5-year APY

2.60%

Minimum Deposit

$0

1-year APY

2.45%

3-year APY

2.50%

5-year APY

2.50%

Minimum Deposit

$2,500

Goldman Sachs Bank USA

at Goldman Sachs Bank USA,

Member, FDIC

at Goldman Sachs Bank USA,

Member, FDIC

1-year APY

2.40%

3-year APY

2.50%

5-year APY

2.60%

Minimum Deposit

$500

What is a CD?

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.

Are CDs safe?

Yes. Most banks and credit unions insure your money in a CD up to $250,000 per person per account type, such as single-owned and joint accounts. Plus, your returns are guaranteed as long as you don’t withdraw early, in which case you may have to pay a penalty.

How do CD rates work?

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. A CD’s term plays a role too: the longer the term, the higher the rate generally.
» See what CDs can earn you with our CD calculator

APY vs. interest rate: What’s the difference?

Both show the rate of interest you can earn on a CD or savings account, but APY factors in compounding interest and the interest rate doesn’t. If you’re comparing CD rates at a glance, APY is more useful. To get the exact return on a calculator, use the interest rate and the CD’s compounding period. (For more details, read our post on APY vs. interest rate.)

How much interest does $10,000 earn in a CD in a year?

This depends on the CD’s interest rate and compounding period. Let’s say you placed $10,000 into a one-year CD with 2.50% APY, which is a 2.47% interest rate, that compounds interest daily. You’d earn about $250 in interest.

Are CD rates going up?

Due to the recent Fed rate cut, CD rates are dropping more than they’re rising. See more details on how this might affect your decision to get CDs.

How do I choose a CD?

The biggest point of comparison for any CD is the rate: the higher it is, the more you save. Compare CD rates by term, for example, five-year CDs with other five-year CDs. Other details to consider would be an unusually high minimum deposit or a harsh early withdrawal penalty (such as cutting into the initial deposit you put into the CD — most early-withdrawal penalties only affect the interest earned, not the initial deposit).

Should I get a CD at a bank or credit union?

Credit unions and online banks are solid places to find competitive CD rates. Credit unions are the nonprofit equivalent of banks, and can generally offer higher savings rates than traditional brick-and-mortar banks. Credit unions’ certificates of deposit are called “shared certificates” and interest “dividends,” and these function as they do at banks.

What are the best credit union CD rates?

See our list of the best credit union CD rates.

What is a jumbo CD?

A jumbo CD is a type of CD with a traditionally high minimum deposit such as $10,000, though it can be lower. Although jumbo CD rates can be higher than regular CDs, online banks and credit unions offer some of the best rates on CDs with low or no minimums.

What is a brokered CD?

A brokered CD is a CD originated by a bank or credit union and offered by a brokerage firm. They function like regular CDs except that they can be traded before their terms end. Check out the pros and cons on our explainer about brokered CDs.

IRA vs CD vs IRA CD: What’s the difference?

An IRA, or individual retirement account, is a tax-advantaged account that contains investments such as stocks, bonds and CDs. A CD is a type of savings account that locks up money for a set term, generally from three months to five years.

An IRA CD is a type of CD used to save a portion of retirement savings. You get the tax-advantaged status of an IRA and the fixed term and rate of a CD.

What are the best IRA CD rates?

See our list of the best IRA CD rates.

Should I put my emergency fund in a CD?

No. CDs are meant for savings you can set aside and leave untouched. Consider a high-yield savings account for money you need in a pinch.

When should you get a CD?

CDs can make sense as a way to lock up some savings dedicated to a short-term goal such as buying a car or house in the next few years. Outside of goals, CDs can be a safe place for money you want to get guaranteed returns on without the risk of fluctuation such as in the stock market.

Do CDs have fees?

CDs don’t have monthly fees like checking or savings accounts might have, but they generally have a penalty if you withdraw before the CD term expires. This early withdrawal penalty tends to be several months’ worth of interest, so it’s usually best to wait to access funds from a CD once it expires. The exception is no-penalty CDs.

What is a no-penalty CD?

A no-penalty CD is a type of CD that doesn’t have 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, but you might need the money sooner than you expect. Here’s a closer look at no-penalty CDs: pros, cons, and some of their rates.

Do I have to pay taxes on interest in CDs?

Yes. Interest earned in CDs is taxable as interest income. Your bank or credit union will usually give you a Form 1099-INT that states the interest each year, unless the amount is under $10. The IRS notes that you generally include interest from CDs when you receive it, so a CD with a term longer than a year wouldn’t have its interest taxed until the term ends.

Is laddering CDs a good idea?

A CD ladder can be a helpful strategy if you don’t want to go all in on one CD, especially if you think rates will keep rising. It works like this: you open multiple CDs at different terms, such as one year, two years and three years, 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.

What’s better: CDs or high-yield savings accounts?

It depends on what’s more important to you: rates or access to your money. The current 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.

What’s better: CD or money market account?

It depends on what rates and type of access to funds you need. Like high-yield savings accounts, money market accounts have ongoing access to funds, while CDs don’t. Among savings accounts, CD rates are traditionally the highest, then money market accounts, then regular savings accounts. However, online high-yield savings account rates now compete with money market rates, which you can see on our list of top rates.

What’s better: CDs or investment accounts?

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.

Alternatives to CDs

Let's say you have an emergency fund that consists of enough cash to cover about three to six months’ worth of living expenses. To grow your long-term savings, consider opening an online brokerage account. Although these financial products come with more risk than CDs, they could lead to higher returns.

Picking the right broker comes down to your priorities. Some investors are willing to pay more for a top-notch platform; others count costs above all else. With brokerage accounts, you don't have to worry about early withdrawal penalties, but your funds may be more difficult to access in a pinch, given that you’ll likely need to sell some investment shares before you can devote that money to anything else.

» For in-depth guidance, check out NerdWallet’s best online stock brokers for beginners

Last updated on August 1, 2019

Methodology

We featured easy-to-join financial institutions that we've reviewed with the highest rates currently listed on NerdWallet's CD rates tool. For the ZIP code and minimum deposit requirement, we used 94103 and $10,000, respectively. We also included select, standout rates from other trusted online financial institutions that we have reviewed. Higher rates might be available elsewhere