Finder is committed to editorial independence. While we receive compensation when you click links to partners, they do not influence our content.
Best 1-year CD rates of May 2021
Earn more interest with the highest 12-month CD rates.
This article was reviewed by Marguerita Cheng, a member of the Finder Editorial Review Board and award-winning advocate for ethical financial planning for over 20 years.
What’s changed in 2021?
We added Quontic Bank CDs to our list for its high interest rate.
The 17 best 1-year CD rates
Use the table to compare 1-year CDs by rate, minimum opening deposit and features. Want to compare features side-by-side? Click the “Compare” box next to your top choices to view multiple accounts at once.
Quick summary of the best 1-year CD rates
- CIT Bank Term CDs: 0.3%
- Discover CDs: 0.5%
- Limelight Bank CD: 0.6%
- First National Bank of America Online CD: 0.6%
- Marcus by Goldman Sachs High-yield CDs: 0.55%
- Ally High Yield CDs: 0.6%
- First Internet Bank CDs: 0.6%
- Hiway Federal Credit Union CD: 0.75%
- Rising Bank CDs: 0.5%
- Synchrony Bank CDs: 0.6%
- Alliant Credit Union CD: 0.5%
- Sallie Mae CD: 0.45%
- Barclays Online CDs: 0.3%
- Citizens Access CDs: 0.6%
- Capital One 360 CD: 0.2%
- American Express CDs: 0.2%
- Quontic Bank CD: 0.65%
How do I find the best 1-year CD for me?
Here’s a few important factors to consider when you compare certificates of deposit:
- The interest rate. The amount of interest applied to your CD will differ between various banks, and the difference can be substantial — shop around at a few different banks to find the best rate.
- Interest payment frequency. With a one-year CD you could choose to have interest earned paid to you monthly, semi-annually or when it matures.
- Few or no fees. With the exception of the penalty charge for an early withdrawal, there should be no other fees applied.
- Minimum deposit requirement. CDs have balance requirements that differ depending on the financial institution. Some only cater to higher deposits of $5,000 or more, while other banks allow for an account with a minimum balance of just $500.
How much will I earn in a 1-year CD?
See how much interest you could earn over 12 months.
Which bank has the highest 1-year CD rate?
As of February 2021, Quontic Bank has one of the highest 12-month CD rates at 0.65% APY. You’ll need a minimum deposit of $500 to open the CD. But if you withdraw your money before it matures, you’ll pay a penalty equal to one years interest.
Pros and cons of a 1-year CD
There are several attractive reasons to open a 1-year CD, but there are also a few drawbacks to keep in mind.
- No monthly fees. CDs are free to open and maintain, so you don’t have to worry about monthly fees eating into your savings.
- Earns more interest than a savings account. A 12-month CD provides you with a competitive interest rate that’s often higher than a traditional savings account.
- Flexibility. A 1-year CD term is long enough to lock in a high interest rate, but short enough to give you easy access to your money should you need it within the next year.
- Can’t access funds until maturity. If you need to withdraw your savings in order to cover an emergency, you’ll generally pay an early withdrawal fee. This is true for any CD aside from no-penalty CDs.
- Minimum deposit requirement. Many banks, particularly those with competitive interest rates, require you to have at least $500 to open an account, though some banks require up to $2,500.
- Rates aren’t as high as long-term CDs. Generally, the longer your CD term, the higher the APY. Even though a 12-month CD is competitive, you could earn more with a 5-year CD.
1-year CD alternatives
If you like the idea of earning a high APY over a relatively short amount of time, but you don’t want to risk facing an early withdrawal penalty, here are three alternatives to consider.
- Shorter-term CDs. Some banks and credit unions offer CDs with terms as short as one month. And while these CDs give you earlier access to your funds, the APYs are often significantly lower than certificates with longer terms.
- High-yield savings accounts. CDs generally offer better interest rates than high-yield savings accounts, but CD rates have recently plummeted due to the pandemic. Now many savings accounts offer higher APYs without the requirement to keep your money locked away for a certain time.
- No-penalty CDs. Although most banks will penalize you if you withdraw funds from your CD before its maturity date, this isn’t always the case. Several banks offer no-penalty CDs that give you access to your money at any time without assessing an early withdrawal fee.
If you’re looking for a secure way to store your money and earn interest over the course of a year, a CD is a useful savings option. However, if you want to add money to your account throughout the year or have access to it in case of an emergency, one of the best savings accounts on the market might be a better fit.
Frequently asked questions
More guides on Finder
Mascoma Bank Statement Savings review
A no-frills savings account for Vermonters and New Hampshirites.
Alta prepaid card review
A prepaid card with built-in budgeting tools, early paydays and a savings account that earns 1% APY.
Porte Banking review
Porte donates to a charity whenever you use your card, but you can’t overdraft from savings.
Best bank accounts for freelancers and the self-employed
Compare the five best bank accounts for self-employed professionals and freelancers.
Unifimoney account review
Unifimoney lets you spend, save and invest, but it’s only free for high-income individuals.
Honeydue Joint Banking review
This bank account and prepaid card combo gives you and your honey a convenient way to manage finances together.
Oxygen personal bank account
Access your cash from any network ATM and earn cashback on your debit card purchases from approved retailers.
Upgrade Rewards Checking review
The free Upgrade Rewards Checking account offers 2% cashback, but you can’t deposit checks.
CIT eChecking account review
CIT’s eChecking account offers more interest than most physical banks, but it can’t compete online.
Cheese Rewards Checking review
A digital bank built for Asian-Americans. Earns up to 10% cash back and up to 3% APY.
Ask an Expert