A jumbo CD is a certificate of deposit that traditionally requires a minimum deposit of $100,000. Some banks and credit unions offer jumbo CDs with lower minimums, such as $25,000.
🤓 Nerdy Tip
Jumbo CDs have higher minimums and their rates aren’t necessarily better than the best CD rates, which usually have opening minimums ranging from $0 to $10,000. Nerdy Takeaways:
- Skip jumbo CDs unless you can satisfy the minimum and you already belong to a bank or credit union that offers them. High-yield CDs with lower minimums, or CD ladders to spread out funds, tend to be a better bet.
- Jumbo can provide a slight rate boost, such as 0.05% or 0.15%, compared to regular CDs at the same bank. However, online banks and credit unions with top CD rates don’t often offer jumbo rates.
- Jumbo minimums get closer to the $250,000 cap on deposit insurance (the cap is higher in some cases, such as for joint accounts) at a bank or credit union.
Regular CD vs. jumbo CD
A jumbo CD requires more money to open than a regular CD, which can have a minimum deposit requirement of $500 or $5,000, for example. Some have no minimum, especially at some online banks such as Ally, Barclays and Capital One.
Jumbo CDs tend to have slightly higher interest rates, on average, than a regular CD, but you can generally find CDs with lower minimums that still have some of the best rates. The biggest banks, for reference, don’t tend to have high rates — at least for standard CD terms — no matter how much you deposit.
Apart from different rates and minimums, regular and jumbo CDs work similarly. They both keep money locked up for a fixed period, usually three months to five years. In return for sacrificing access to your funds, you earn an interest rate that is usually higher than that of a regular savings account.
Want to see best CDs by term?
View a curated list of our picks based on competitive rates and terms.
Regular CD rates vs. jumbo CD rates
Credit unions tend to have the best jumbo CD rates, according to our analysis. Here are some examples of jumbo CD rates compared to regular CD rates at a few credit unions. Many credit unions call CDs share certificates or certificates. The difference in the rates of return, shown as annual percentage yields in the tables below, tends to be small.
Alliant Credit Union
Alliant’s regular certificates have a minimum opening requirement of $1,000 and its jumbo certificates require at least $75,000. (Membership is easy to obtain nationwide.)
| Term | Regular certificate (CD) rate | Jumbo certificate (CD) rate |
|---|---|---|
| 1 year | 3.75% APY. | 3.80% APY. |
| 3 years | 3.60% APY. | 3.70% APY. |
| 5 years | 3.65% APY. | 3.70% APY. |
SchoolsFirst Federal Credit Union
SchoolsFirst’s regular certificates have a $500 minimum and its jumbo certificates require at least $100,000. (Membership is mostly restricted to California residents involved with educational institutions.)
| Term | Regular certificate (CD) rate | Jumbo certificate (CD) rate |
|---|---|---|
| 1 year | 3.75% APY. | 3.90% APY. |
| 3 years | 3.80% APY. | 3.95% APY. |
| 5 years | 3.90% APY. | 4.05% APY. |
Navy Federal’s regular certificates have a $1,000 minimum and jumbo certificates have a $100,000 minimum. (Membership is largely restricted to members of the military and their families.)
| Term | Regular certificate (CD) rate | Jumbo certificate (CD) rate |
|---|---|---|
| 1 year | 3.70% APY. | 3.75% APY. |
| 3 years | 3.50% APY. | 3.55% APY. |
| 5 years | 3.50% APY. | 3.55% APY. |
When to consider regular or jumbo CDs
CDs give some of the highest returns for deposit accounts, and they tend to work best for specific short-term goals, such as saving for a wedding or down payment for a home a few years down the road. Learn more about when CDs are worth it.
But the federal deposit insurance limit for a traditional bank account is $250,000. If you want the assurance that you will get all your money back if your bank or credit union fails, keep your deposit, and the expected interest amount you’ll earn, at or below that limit. To ensure your money is protected, you can also open a joint account, which insures $250,000 per co-owner, or consider multiple CDs from different banks.
» Need more funds insured? Learn how to insure over $250K
If you have enough savings for a jumbo CD, compare rates across both jumbo and regular CDs. In general, higher CD minimums don’t mean higher rates. People who prefer jumbo CDs might not want the risk of investing money in the stock market. But if you can tolerate risk and want higher returns for long-term investments, consider a brokerage account.
Alternatives to jumbo CDs
If you’re not concerned about jumbo CD minimums, and want to keep all your funds in low-risk savings vehicles, here are other options to consider:
- CD ladder: This strategy involves spreading your funds across a mix of short-, mid- and long-term CDs.
- Cash management accounts: These work as a combination of checking and savings accounts, and typically with higher FDIC insurance limits.
- Check out other short-term investment options.
