Certificates of deposit are a great way to lock in a high interest rate for a whole year.
When you have short term savings that you can’t put in higher yielding, and higher risk, accounts – a 12-month CD is often a great choice. They’re the cornerstone of a good savings plan and with a locked in rate, you can get predictability.
Interest rates are at the highest they’ve been in many years, so now is a great time to consider a 12-month CD.
Alternatively, if you don’t want to lock in a 12-month rate, you can consider no penalty CDs as an alternative. They just like regular CDs except you can close them for any reason without penalty – a great choice if you see higher rates.
Table of Contents
- USAlliance Financial – 5.20% APY
- Synchrony Bank – 5.20% APY
- Discover® Bank – 4.00% APY
- BMO – 4.00% APY
- Barclays Bank – 4.00% APY
- Western Alliance Bank – 3.80% APY
- First Financial Northwest Bank – 4.20% APY
- Quontic Bank – 3.25% APY
- Ally Bank – 3.85% APY
- Important Facts about 12-Month CDs
- Where to Shop for CDs
- Final Thoughts on 12-Month CDs
| Bank Name | CD Rate | |
|---|---|---|
| USAlliance Financial | 5.20% APY | Learn more |
| Synchrony Bank | 5.20% APY | Learn more |
| Discover® Bank | 4.00% APY | Learn more |
| BMO | 4.00% APY | Learn more |
| Western Alliance Bank | 3.80% APY | Learn more |
| Barclays Bank | 4.00% APY | Learn more |
| First Financial Northwest Bank | 4.20% APY | Learn more |
| Quontic Bank | 3.25% APY | Learn more |
| Ally Bank | 3.85% APY | Learn more |
Some of the offers on this list are with credit unions and banks that work with the Raisin platform. (Raisin was previously known as SaveBetter) With Raisin, you open an account with Raisin and get the higher rate through them. Your account is managed through Raisin but the funds are still at the bank and get FDIC insurance. You don’t get an account number at the bank though, it’s all grouped together with other Raisin customers, but it’s still insured and protected. The benefit is that you get higher rates and can easily move it between partner banks to get even higher rates. Raisin negotiates these higher rates because they can get deposits for the bank much cheaper than their own marketing efforts.
USAlliance Financial – 5.20% APY
USAlliance Financial is a full-service credit union based out of New York. They were founded in 1966 as a credit union for IBM employees in the tri-state area (New York, New Jersey, and Connecticut) but have since expanded to several other companies and 150,000 member worldwide.
They currently offer an 11-month CD with a yield of 5.20% APY, one of the highest we’re seeing right now. Interest compounds daily and is paid out monthly.
Synchrony Bank – 5.20% APY
Synchrony Bank is an FDIC insured (#27314) commercial bank headquartered in Utah. They have a variety of banking products, including a high yield savings account offering 3.80% APY.
They have a CD with a yield of . There is no minimum deposit, so a good way to lock up some cash at a healthy rate.
Discover® Bank – 4.00% APY
Discover Bank is probably a familiar name to you and they have a whole suite of online banking options that are very attractive. First, make sure you read up on the Discover Bank bonus for new customers.
Next, if you are looking for a 12-month CD, they’re currently offering one with a yield of 4.00% APY. As a a bank, the are insured by the Federal Deposit Insurance Corporation.
The CD has no minimum deposit, no monthly fees, and the early withdrawal penalty is 3 months of simple interest.
BMO – 4.00% APY
BMO is a bank based out of Chicago with a presence in eight states but they have over 500 branches. They offer a great bank bonus on their accounts but their CDs are very competitive, get 4.00% APY on the 13-month CD. Their CDs have a minimum deposit of $1,000.
The approach here is to take advantage of BMO’s checking and savings account bonuses and get up to $500 Cash (plus optional $100 gift card) in cash for satisfying a few conditions. Then get their CD and the higher rate.
Barclays Bank – 4.00% APY
Barclays Bank is an international bank with headquarters in London but a sizable U.S. operation that includes many deposit products like savings and certificates of deposit. While they don’t offer a no-penalty CD, their 12-month CD yields an impressive 4.00% APY.
What’s nice about Barclays is that their savings account offers a great yield too – up to 4.10% APY! (with minimum balance requriements)
They are FDIC insured and the CDs have no minimum to open. The early withdrawal penalty on a 12-month CD is 90 days of simple interest.
Western Alliance Bank – 3.80% APY
Western Alliance Bank is a bank based out in Phoenix, Arizona and they have a fantastic 12-month CD offer that is currently second on our list – get 3.80% APY with a minimum deposit of just $1. This offer is available through Raisin and is it FDIC insured.
Western Alliance Bank is relatively new, having been founded in 1994, but they have assets close to $40 billion – so they are not small.
Learn more at our full review of Western Alliance Bank.
First Financial Northwest Bank – 4.20% APY
First Financial Northwest Bank offers a 12-month certificate of deposit with a yield of 4.20% APY through the Raisin platform. The minimum deposit is just $1 and there are no maintenance fees. Interest is compounded daily and credited monthly.
First Financial Northwest Bank was founded in 1923 and headquartered in Renton, Washington. It’s publicly traded and is FDIC insured.
Quontic Bank – 3.25% APY
Quontic Bank is a a digital bank that is also a CDFI (Community Development Financial Institution, a US Department of Treasury certification), which means they look to use private and public funds to help economically disadvantaged communities. It’s a positive mission.
They offer a 12-month CD with a 3.25% APY, which is a great rate especially when you couple it with their savings account that offers 3.85% APY.
Interest compounds daily, there are no monthly fees, and a $500 minimum balance.
Here’s our full review of Quontic Bank for more information.
Ally Bank – 3.85% APY
Ally Bank is an online bank (and it’s the one I use as my primary online bank) and they have a 12-month CD currently offering 3.85% APY. You can also get pretty solid rates on checking and savings accounts too – it’s one of the reasons why I use them as my main bank.
As a a bank, the are insured by the Federal Deposit Insurance Corporation.
Their CDs have no minimum deposit to open and the early withdrawal penalty is only 60 days of interest.
Important Facts about 12-Month CDs
Before you open a 12-month CD from a bank, you’ll want to research these terms about each one before you open an account:
- Early withdrawal terms and penalty – Each bank’s early withdrawal terms are different. Almost all of them will assess some kind of penalty, usually 90 days or 3 months of interest, but there are some that charge slightly less (like Ally).
- Minimum deposit – Many online banks will let you open a CD with just $1 but some will require more. It’s important to know this because you can open multiple CDs at a single bank. If the minimum is low, just open several small CDs so you can close them if you need to in case you need the money earlier.
- Maximum deposit – Some CDs have a maximum deposit amount because they want to limit how much you can earn at the higher interest rate. This is rare.
Where to Shop for CDs
The bank where you hold your savings is a good place to start. It will be a convenient place to open an account and you won’t be adding another bank to manage. However, not all banks offer top rates. So, if your current bank isn’t a viable option, consider shopping at Raisin.
Raisin aggregates CD rates from many banks and allow you to quickly scan and choose the best CD rates and terms for you without having to spend hours digging through individual bank websites.
Here’s our full review of Raisin.
Final Thoughts on 12-Month CDs
We aim to keep our 12-month CD rates as up to date as possible but always review the bank’s website to see the latest rates.
12-month CDs occupy that sweet spot where you can get a higher interest rate but lock up your funds for a short period of time. Many of the banks on our list will give higher rates for longer terms.
