First Internet Bank CD review
Competitive rates for short- and long-term savings, but there’s a fee to close your matured CD.First Internet Bank is an online bank. It offers both short- and long-term CDs with its highest rate at 0.96% APY for its 5-year CD. But if you withdraw your money early, you’ll pay back all or more than what you would’ve made in interest.
|Minimum deposit to open||$1,000|
|Early withdrawal penalty||90 days interest for terms of 1 to 5 months |
180 days interest for terms of 6 to 23 months
360 days interest for terms of 24 to 60 months
Heather Petty is a writer at Finder specializing in banking, investments and insurance. She's a self-proclaimed word nerd who worked as a technical writer and editor for the casino systems industry and is an internationally published young adult mystery author. Heather earned a bachelor’s degree in English from the University of Nevada, Reno.
With a large selection of CD terms, First Internet Bank offers a variety of high-interest CD rate options to help you meet your savings goals. You have the option of opening a short-term CD ranging from three months to one year or a long-term CD ranging from 18 to 60 months.
But if you don’t have a checking or savings account with First Internet Bank, you’ll pay $5 to receive a check with your money after your CD matures.
How do I open a First Internet Bank CDs account?
If you have a checking or savings account with First Internet Bank, you can open a CD through your online account without filling out any paperwork. For those who don’t:
- Go to the provider’s site and follow the steps to apply.
- From the First Internet site, select Open an Account.
- Note the eligibility requirements and select Get Started.
- The CD you selected should be listed. From there, you can select Add Products to select multiple CDs, click the trash icon to delete one of your selections or click Next to open an account for the CDs listed.
- Enter your email and phone number, then choose whether to upload a photo of the back of your driver’s license or fill out a form with your personal information instead.
- Fund your CD.
You must meet the following requirements to open a CD with First Internet Bank:
- US citizen or resident
- At least 18 years old
- Valid Social Security number
- Government-issued ID
Have the following information ready before you apply:
- Name, address and date of birth
- Social Security number
- Driver’s license
- Email and phone number
- Mother’s maiden name
Fund your CD using one of the following methods:
- Bank transfer
- Transfer from your existing First Internet Bank checking or savings account
Benefits of a First Internet Bank CD
Look forward to the following benefits from your CD account:
- Short-term options. First internet has 3- and 6-month terms to help you with your short-term savings goals.
- Competitive rates. The interest rates on First Internet’s CDs are equal to or higher than its competitors.
- Wide selection of terms. This bank offers eight different terms, allowing you to choose a term as short as three months or as long as 60 months. Or both if you want to diversify your savings.
What to watch out for
Keep in mind the following drawbacks before you decide to open a CD with First Internet Bank:
- No branches. You’ll need to be comfortable doing all of your banking transactions online.
- High early withdrawal fees. If you withdraw your money early, you may be paying as much or more than you would have made in interest, especially for the shorter CD terms.
- Fee to close your account. Most CDs allow you to withdraw your funds and close your matured CD without a fee, as long as you do it within the grace period. But First Internet Bank charges $5 to send you the final check. To avoid the fee, you can transfer your funds into a First Internet Bank checking or savings account.
Compare with other CDs
If you’re not interested in investing with an online-only bank or you’re concerned about the early withdrawal fees, you’ll want to keep looking. As always, compare your options when considering a CD.
How do I cash in a CD?
When your CD matures, you have a 10-day grace period to select one of the following options:
- Do nothing. If you don’t contact the bank, the CD will automatically rollover into a new CD of the same term at the interest rate of the new CD.
- Withdraw the funds. Withdraw the funds within the 10-day grace period, thereby closing the account. You’ll pay a $5 fee to receive cash with the amount.
- Use online banking. Transfer the funds into your First Internet Bank checking or savings account for free after it has matured.
What other savings products does First Internet Bank offer?
In addition to CDs, you can find the following savings products:
- Free savings. A no-fee, no minimum balance account that earns 0.75% APY. You’ll need $25 to open the account.
- Money market savings. Open this account with $100, but you need to maintain an average daily balance of at least $4,000 to avoid the $5 monthly maintenance fee. The account earns 1.51% interest.
- Tomorrow’s Tycoons. This children’s savings account earns 0.75% APY and you’ll need $100 to open it.