The Top 6 Month CD Rates for March 2018
Posted January 31, 2018 9:00 a.m. EST
Updated March 5, 2018 6:00 p.m. EST
Short-term certificate of deposit (CD) accounts offer investors a safe opportunity to squirrel away money for a future expense. If you’re looking for a brief solution for storing your cash and want to earn more interest than a typical savings account will offer, a 6 month CD can make a lot of sense. (It’s also a good place to start if you’re building a CD ladder.)
Using information from DepositAccounts.com, another LendingTree company and a database of offerings at more than 17,100 banks and credit unions, we found the five banks and five credit unions with the top 6 month CD rates. If there was a tie, we chose the institution with the smaller minimum-deposit requirement. We pulled these rates on March 5, 2018, and we excluded promotional offerings. The national average APY on 6 month CDs (among banks and credit unions) is 0.46%, according to the DepositAccounts.com database. These options outperform that average by a long shot. (You may also want to view our picks for the overall best CD rates.)
Banks with the best 6 month CD rates
6 month CD APY: 1.70%Bank information: Banesco is an international bank serving seven different countries, including the U.S. Banesco USA, located in South Florida, serves customers nationwide through its online banking platform.Where to open CD account: OnlineMinimum balance to open: $1,500Maintenance fees: $0Early withdrawal penalties: 30 days’ interest
Live Oak Bank
6 month CD APY: 1.65%Bank information: Live Oak Bank is located in Wilmington, NC, but serves customers nationwide through online banking. While their initial focus was to help small businesses acquire funding, they now help all individuals through personal banking.Where to open CD account: OnlineMinimum balance to open: $2,500Maintenance fees: $0Early withdrawal penalties: 90 days’ interest
First Internet Bank of Indiana
6 month CD APY: 1.63%Bank information: A subsidiary of First Internet Bancorp, this online bank founded in 1999 has no branch locations, but offers service online in all 50 states.Where to open CD account: OnlineMinimum balance to open: $1,000Maintenance fees: $0Early withdrawal penalties: 90 days’ interest
6 month CD APY: 1.56%Bank information: VirtualBank is a subsidiary of Louisiana-based IBERIABANK Corp., offering 24/7 digital or telephone access on eCDs, open to applicants anywhere in the U.S.Where to open CD account: Online (paperless account options)Minimum balance to open: $10,000Maintenance fees: $0Early withdrawal penalties: 30 days’ interest
6 month CD APY: 1.50%Bank information: DollarSavingsDirect is an online division of Emigrant Bank, which is located in New York.Where to open CD account: OnlineMinimum balance to open: $1,000Maintenance fees: $0Early withdrawal penalties: 90 days’ interest
Credit unions with the best 6 month CD rates
PenFed Credit Union
6 month CD APY: 1.65%Credit union information: PenFed, established in 1935, today serves more than 1.6 million members at branch locations in all 50 states and select overseas facilities.Membership details: Open to current or retired members of the U.S. military, federal employees, affinity partners, members of qualifying organizations, or by donating to Voices for America’s Troops or the National Military Family Association.Where to open CD account: You can open an account online or at one of their branches.Minimum balance to open: $1,000Maintenance fees: $0Early withdrawal penalties: 90 days’ interest
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Latino Credit Union
6 month CD APY: 1.50%Credit union information: Founded in Durham, N.C., in 2000, Latino Credit Union opened its doors as a solution to the Durham Latino community who were being robbed and mugged. While their original intent was to serve the Latino community, they have since expanded their membership to include anyone and everyone.Membership details: Anyone who is willing to provide a one-time $10 donation to the Latino Community Development Center is welcome to become a member of the credit union.Where to open CD account: OnlineMinimum balance to open: $500Maintenance fees: $0Early withdrawal penalties: 90 days’ interest
Service Credit Union
6 month CD APY: 1.30%Credit union information: Founded in Portsmouth, N.H., in 1957, Service Credit Union originally served employees of Pease Air Force Base. Today, it has grown to serve over 200,000 people throughout New Hampshire, North Dakota, Massachusetts, and even Germany.Membership details: To become a member, you must live or work, or have family members that live or work in New Hampshire or Falmouth, Bourne, Mashpee, and Sandwich, Mass. Current members of the military, veterans, retirees, and reservists of the U.S. Armed Forces along with their families are also eligible for membership.Where to open CD account: You can open an account online or at one of their many branches.Minimum balance to open: $250Maintenance fees: $0Early withdrawal penalties: Determined by credit union.
Bethpage Federal Credit Union
6 month CD APY: 1.25%Credit union information: Bethpage Federal Credit Union, located in Bethpage, NY, was founded for employees of Grumman Plant in 1941. Since then, they’ve undergone a lot of changes to expand their membership to include anyone in the U.S.Membership details: A one-time $5 deposit into a Bethpage savings account enables you to become a member of the credit union.Where to open CD account: OnlineMinimum balance to open: $50Maintenance fees: $0Early withdrawal penalties: Determined by credit union.
CapEd Credit Union
6 month CD APY: 1.25% (must be under 25 years old to earn APY)Credit union information: CapEd Credit Union focuses on supporting teachers in Idaho, but is open to almost anyone.Membership details: To become a member, you must work, volunteer, or have retired from the educational industry in Idaho. If you have a family or household member who works, volunteers, or has retired from Idaho’s educational system, you can also qualify for membership. Finally, if you have a family or household member who is already a CapEd member then you are eligible for membership.Where to open CD account: OnlineMinimum balance to open: $500Maintenance fees: $0Early withdrawal penalties: The lesser of 90 days’ interest, interest earned within the number of days between opening the account to the date of withdrawal, or seven days’ interest if withdrawn before seven days.
Pros and cons of using 6 month CDs
- The CD rates offered by banks and credit unions are generally higher than those on savings accounts.
- The rates are fixed and guaranteed for the length of their term.
- The discipline of keeping the funds in the CD means the money will be available upon maturity. (Note: Most banks offer a seven-day grace period to reinvest or withdraw the investment, after which the funds will roll over into a new CD. However, you are not guaranteed the same rate.)
- Six-month CD rates are lower than those offered on longer CD investment terms.
- To tap into the CD funds — even for emergencies — consumers must accept a loss through penalties, which can include a percentage of the funds, a percentage of the earned interest, or a combination of both. A typical penalty on a short-term CD is between 30 and 90 days’ worth of interest earnings.
- If you’re not confident you can do without access to the funds for six months, you may be better off putting your money in a traditional savings account, which is likely to earn less interest than a CD.
- Since CD rollovers may reset at a different percentage rate, consumers must speak with the bank before the grace period ends to ensure they are getting the best deal.
Using a 6 month CD for laddering
A CD ladder comprises small-amount CDs with varying terms and respective interest rates that contribute to a long-term investment strategy. After the 6 month CD matures, investors can withdraw the funds for a predetermined expense. Or, they can reinvest the money into a longer-term CD with a better rate. By staggering the maturity dates on short-term CDs, consumers have access to their cash on a regular, predictable basis.
Where can you open a CD account?
Consumers can open 6 month CD accounts (or longer) from banks and credit unions. Bank and credit union CD rates are based on Federal Reserve rates, and there may be strategic times to pursue these short-term instruments following a rate increase.