Best 1-Year CD Rates for September 2024: Up to 5.25%

Frequently Asked Questions

• Can You Get 6% on a CD?

  You may be able to get a 6% interest rate or higher on a CD that is offered by a local or regional bank or credit union. However, with higher rates, there are often more rules such as minimum deposit requirements, specific terms, or large penalties. For our list of the best 1-year CD rates, we rank CDs that are available nationwide and do not have a minimum deposit of more than $25,000. Currently, the best 1-year CD rate is 5.25% APY from Mountain America Credit Union and Merchants Bank of Indiana.

• What Is the Best Place to Open a CD?

  The best place to open a CD will be a bank or credit union who pays the highest rates. These may differ from the big bank you work with for your checking account. In fact, some of the biggest banks pay among the worst rates. In contrast, smaller brick-and-mortar banks, online-only banks, and credit unions tend to offer substantially higher returns. Our daily rankings of the best CD rates is an easy way to find the top nationwide rates.
  

  You may also wonder about the inconvenience of having your funds at more than one bank. With CDs, however, this is essentially a non-factor, since you won’t be regularly interacting with your CD account. Even with a savings or money market account, internet transfers between institutions are easy these days. But you won’t be making transfers to or from your CD account until you cash out.

• Are 1-Year CDs a Good Short-Term Investment?

  A 1-year CD will be a good short-term investment for you if you can deposit money and leave it untouched for 10 to 14 months. If so, finding a 1-year CD with a high interest rate can offer returns of 5.00% or more. For example, if you deposit $5,000 in a 1-year CD (12 months) with a 5.50% interest rate, you'd earn $275 by the end of the term. If you need the money sooner than that, consider a 6-month CD.

• Should You Consider Short-Term or Long-Term CDs?

  Anyone looking to reach a savings or investment goal should consider both short-term and long-term CDs. Short-term CDs, like 3-, 6-, or 12-month CDs may help you stay on track toward your goal by locking up your money for a period of time and then earning you interest at the maturity date. This could help prevent you from spending that money since it's locked up for a short time. Long-term CDs may also fit into your savings strategy if you want to lock in a high CD rate now before rates drop in the future. To make the most of short-term and long-term CDs, consider a CD ladder.

• What If I Need to Withdraw My Money Early?

  Early withdrawal penalties, or EWPs, differ greatly among banks and credit unions. For a one-year term, the most common EWP is three or six months' worth of interest. What that means is, if you cash in your CD before its maturity date, the funds returned to you will be docked by the amount of interest the CD would have earned in three or six months.

  But don't assume all EWPs are similar, or even reasonable. You may find one that charges a whole year's worth of interest, while another assesses a mild 30 days' interest. Still others have more complicated or onerous policies that can even eat into your principal. That's why due diligence is critical before funding any CD. You want to be sure you understand what you're signing up for. And when two choices are relatively equal, choose the CD with the milder penalty.

• Are CDs Safe?

  CDs are safe because they are usually insured by the FDIC or NCUA when they are opened at a bank or credit union. If you open a CD at a brokerage, check to see what type of insurance the account has. As with other bank accounts, your money at a bank or credit union is insured for up to $250,000 (across all your accounts at that institution). Each time you open an account at a new bank or credit union, your money at that institution is insured for up to $250,000 as well.

• Are 1-Year CDs From Smaller Banks and Credit Unions Trustworthy?

  Smaller banks and credit unions are trustworthy. Just like CDs from big banks, these institutions are often insured by the FDIC or the NCUA, so your money is safe up to $250,000. A 1-year CD from one of these smaller institutions may pay more than a large bank or credit union, too. This is often because the bigger institutions don't need to pay high rates to lure new customers, while the smaller banks and credit unions do.

• Can You Lose Money on a 1-Year CD?

  Generally speaking, you can't lose the money you deposit in a 1-year CD if you only withdraw it when the term has matured, or there's no penalty. Most CD accounts are also insured by the FDIC or NCUA, so your money is safe if it's at a bank or credit union with this insurance. The only time you can "lose" money on a 1-year CD is if you withdraw it early and there's a penalty, such as the loss of one month's worth of interest. But in that case, you'd only lose interest, not your initial principal payment.

• Financial Institutions We Review

  We researched and reviewed over 250 banks, credit unions, and financial institutions to find the best CD rates you see above on this list. While we write individual reviews for most, we do not always write reviews for those we would not recommend. Below are the banks, credit unions, and financial institutions we researched along with links to individual company reviews to help you learn more before making a decision:

  1st Source Bank, 5star Bank, ableBanking, Abound Credit Union, Achieva Credit Union, Affinity Federal Credit Union, Affinity Plus Federal Credit Union, Air Force Federal Credit Union, Alabama Credit Union, Allegacy Federal Credit Union, Alliant Credit Union, Ally Bank, Amerant Bank, American 1 Credit Union, American Express, American Heritage Credit Union, Andrews Federal Credit Union, Apple Federal Credit Union, Banco do Brasil Americas, Banesco USA, Bank of Baroda, Bank5 Connect, Bank7, Texas Capital Bank, bankESB (Easthampton Savings Bank), BankUnitedDirect, Barclays, BBVA Bank, Bellco Credit Union, Blue Federal Credit Union, BMO, BMO Alto, BrioDirect, Cadets Federal Credit Union, California Coast Credit Union, Capital One, Capitol Federal Savings Bank, CD Bank, CFG Bank, Chase Bank, Chevron Federal Credit Union, CIBC (Agility Banking), CIT Bank, Citibank, Citizens Access, Citizens Trust Bank, Colorado Federal Savings Bank, Bread Savings, Communitywide Federal Credit Union, ConnectOne Bank, Connexus Credit Union, Consumers Credit Union, Corporate America Federal Credit Union (CAFCU), Credit Union of Denver, Credit Union of the Rockies, Digital, Federal Credit Union, Discover Bank, DollarSavingsDirect, Dover Federal Credit Union, Dow Credit Union, Evergreen Bank Group, RocklandTrust Bank, Elements Financial, EmigrantDirect.com, Liberty Federal Credit Union, Fidelity Investments, Financial Partners Credit Union, Financial Resources Federal Credit Union, First Financial Credit Union, First Financial Northwest Bank, First Internet Bank, First National Bank of America, First Technology Federal Credit Union, Fort Bragg Federal Credit Union, Garden Savings Federal Credit Union, Georgia Banking Company, Georgia's Own Credit Union, GreenState Credit Union, Greenwood Credit Union, Grow Financial Federal Credit Union, GTE Financial, Gulf Coast Bank & Trust Company, Hanscom Federal Credit Union, Heritage Bank, Hiway Federal Credit Union, Home Loan Investment Bank, Home Savings Bank, Hope Credit Union, HSBC Direct, Hughes Federal Credit Union, Hyperion Bank, Ideal Credit Union, iGObanking, Interior Federal Credit Union, Justice Federal Credit Union, Kinecta Federal Credit Union, KS State Bank, La Capitol Federal Credit Union, Lafayette Federal Credit Union, Lake Michigan Credit Union, Langley Federal Credit Union, Latino Community Credit Union, Limelight Bank, Live Oak Bank, Luther Burbank Savings, MYSB Direct, MAC Federal Credit Union, Main Street Bank, MainStreet Bank, MapleMark Bank, Marcus by Goldman Sachs, Market USA Federal Credit Union, Matadors Community Credit Union, MECU Credit Union, Merrick Bank, Michigan State University Federal Credit Union, Mills42 Federal Credit Union, Mountain America Credit Union, MTC Federal Credit Union, MutualOne Bank, My Banking Direct, My eBanc, My Savings Direct, NASA Federal Credit Union, Nationwide by Axos Bank, Navy Federal Credit Union, nbkc, NexBank, North Country Savings Bank, Northern Bank Direct, Northfield Bank, Northpointe Bank, Nuvision Federal Credit Union, Oklahoma Central Credit Union, One American Bank, OneUnited Bank, Pacific National Bank, Paramount Bank, PARDA Federal Credit Union, Partner Colorado Credit Union, Patelco Credit Union, Pen Air Federal Credit Union, PenFed Credit Union, People's Credit Union, First Service Credit Union, Pinnacle Federal Credit Union, Popular Direct, Premier America Credit Union, Presidential Bank, FSB, Prime Alliance Bank, PSECU (Pennsylvania State Employees Credit Union), Quontic Bank, Quorum Federal Credit Union, Rising Bank, Merrimack Valley Credit Union, Salal Credit Union, Sallie Mae Bank, Santa Clara County Federal Credit Union, Signature Federal Credit Union, Spectrum Credit Union, SRP Federal Credit Union, State Bank of India Chicago, State Bank of India New York, State Bank of Texas, State Department Federal Credit Union, Summit Credit Union, Sun East Federal Credit Union, Superior Choice Credit Union, Synchrony Bank, TAB Bank, Teachers Federal Credit Union, Technology Credit Union, The Federal Savings Bank, Third Federal Savings & Loan, EverBank, TotalBank, Transportation Federal Credit Union, TruStone Financial Credit Union, UNIFY Financial Credit Union, Expedition Credit Union, United States Senate Federal Credit Union, United Texas Bank, University Federal Credit Union, US Bank, USAlliance Financial, USPS Federal Credit Union, Velocity Credit Union, VeraBank, Vio Bank, Virtual Bank, WebBank, Webster Bank, Wells Fargo, Western Vista Credit Union, Wings Financial Credit Union, XCEL Federal Credit Union, BankPurely, Umbrella Bank, giantbank.com, CapEd Credit Union, Zeal Credit Union, Finworth, Coastal1 Credit Union, Service Credit Union, National Cooperative Bank, Premier Members Credit Union, Bank of America, Flagstar Bank, 1st MidAmerica Credit Union, INOVA Federal Credit Union, Genisys Credit Union, Ivy Bank, Heartland Credit Union, Luana Savings Bank, Spectra Credit Union, Workers Credit Union, Credit Human, EFCU Financial, Poppy Bank, Credit One Bank, Vibrant Credit Union, CFBank, Department of Commerce Federal Credit Union, Seattle Bank, Crescent Bank, Pima Federal Credit Union, Cross River Bank, USAA, Great River Federal Credit Union, Brilliant Bank, Merchants Bank of Indiana, LendingClub, Chartway Credit Union, First Central Savings Bank, AgFed Credit Union, North American Savings Bank, Pelican State Credit Union, First Community Credit Union, Bask Bank, Skyla Credit Union, SkyOne Federal Credit Union, 3Rivers Federal Credit Union, Utah First Credit Union, Pasadena Federal Credit Union, Magnifi Financial, AloStar, Primis Bank, Farmers Insurance Federal Credit Union, Tampa Bay Federal Credit Union, Veridian Credit Union, Republic Bank, Salem Five Direct, All In Credit Union, Bethpage Federal Credit Union, Self-Help Federal Credit Union, Forbright Bank, Jovia Financial Credit Union, Sun Canyon Bank, Fortera Credit Union, Partners 1st Federal Credit Union, SouthEast Bank, American Bank, Newtek Bank, CBC Federal Credit Union, Vanguard, All America Bank, Amalgamated Bank, Citizens State Bank, AmBoy Direct, Republic Bank of Chicago, Oklahoma Community Credit Union, BluPeak Credit Union, Valley Direct, Bayer Heritage Federal Credit Union, First Harvest Credit Union, Orion Federal Credit Union, Wellby Financial, FedChoice Federal Credit Union, CoVantage Credit Union, Choice First Bank, Sandia Area Federal Credit Union, OMB Bank, Minnequa Works Credit Union, Securityplus Federal Credit Union, Bank of South Texas