If you’ve got some money saved up, it’s usually not that hard to part with it for three months, especially if you’ll get a better return than you would with a savings account. Three-month CDs often have a higher annual percentage yield (APY) than traditional savings products, and the rates don’t change like they can with savings accounts. Sure, you’ll find better rates on CDs with longer terms, but if you don’t want to lock up your money for too long, a 3-month CD is a relatively stress-free option.
We review more than 150 banks and credit unions every weekday to find the best rates on 3-month CDs (we also consider 2- and 4-month CDs). Our rankings are based on the highest APY, but in the case of a tie, we favor the CD with the shortest term, then with the lowest minimum deposit required to earn the APY, and then with the smallest penalties for early withdrawal. All accounts are available nationwide and are insured by either the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA).
Here are the top 3-month CDs as of Dec. 3, 2020.
APYs are changing rapidly amid widespread uncertainty about the economy and financial markets. The Balance is monitoring rates and updating them accordingly.
Best 3-Month CD Rates
|Bank or Credit Union||APY||Minimum Deposit||Early Withdrawal Penalty|
|Chevron Federal Credit Union||0.60%||$500||3 months of interest|
|Spectrum Federal Credit Union||0.60%||$500||3 months of interest|
|BrioDirect||0.50%||$500||3 months of interest|
|Greenwood Credit Union||0.50%||$1,000||6 months of interest|
|NexBank||0.50%||$10,000||1 month of interest|
|TotalDirectBank||0.50%||$25,000||1 month of interest|
|Pen Air Federal Credit Union||0.45%||$1,500||3 months of interest|
|INSBANK Online||0.45%||$2,500||4 months of interest|
|Hiway Federal Credit Union||0.45%||$25,000||1 month of interest|
|Affinity Plus Federal Credit Union||0.40%||$500||3 months of interest|
Here are details about some of the institutions on our list.
If the logo for Chevron Federal Credit Union looks a little familiar, there’s a good reason why. The credit union was founded in 1935 and has more than 100,000 members. It primarily serves members employed by the Chevron Corporation (i.e., the gas stations you’re probably familiar with). If that’s not you, and you don’t qualify through other means, a $15 donation to join the Contra Costa County Historical Society also makes you eligible for membership. Additionally, you’ll need to keep $25 in a savings account, which is a tad bit higher than most credit unions.
In addition to Chevron FCU branches in California, members have access to more than 5,000 CO-OP branches and 85,000 fee-free ATMs nationwide. Chevron FCU also offers checking and savings accounts, loans, and other services.
Spectrum Credit Union merged with Chevron Federal in 2012. Spectrum does, however, operate independently in areas not served by Chevron so is listed here separately.
Spectrum was originally founded as Bechtel Employees Federal Credit Union. If you do not qualify for membership through your employer or other means, you can join the Contra Costa County Historical Society (or another nonprofit linked to the credit union) for as little as $15. Additionally, you’ll have to maintain a savings account with a minimum deposit of $25.
Spectrum’s CDs range from 3-month to 5-year terms. Members also can get a full slate of bank accounts, as well as loans, credit cards, and insurance.
BrioDirect is another digital subsidiary bank that’s an offshoot of a larger, more established institution. In this case, its parent is Sterling National Bank, which has been around since 1888 and has assets worth more than $30 billion. You can only get two types of online accounts here: a high-yield savings account or a high-rate CD. Aside from its high rates, BrioDirect differs from some of its competitors by offering a simplistic website design with an easy-to-navigate interface. Online savings accounts and CDs aren’t that difficult to manage compared to other financial products.
Founded in 1948, Greenwood Credit Union is a Rhode Island-based institution that brags over $450 million in assets. It offers business accounts alongside personal offerings such as checking, savings, and money market accounts, credit and gift cards, loans, and CDs with 3-month to 5-year terms. The credit union has over 50,000 members, and the open membership means you don’t have to be affiliated with any particular organization to become one of them. Just open a savings account with $5 to start using its products and services.
Founded in 1922, NexBank has nearly $8.9 billion in assets. It serves customers in and around Dallas, Irving, and Plano, Texas, mostly financial institutions, large corporations, real estate companies, and middle-market firms. However, it also offers personal banking products, including checking, savings, and money market accounts, mortgages, and CDs with terms ranging from three months to five years.
TotalDirectBank is a division of City National Bank of Florida, which was founded more than 70 years ago. TotalDirectBank keeps the product lineup simple, with money market accounts and CDs with terms of up to five years. Anyone in the U.S. (except those in Florida, Puerto Rico, American Samoa, Guam, Northern Mariana Islands, and U.S. Virgin Islands) can open a money market or CD account.
Founded in 1936, Pen Air Federal Credit Union is the largest and oldest local credit union in Pensacola, Florida. Though there are only 15 locations in Northwest Florida and Southeast Alabama, there are more than 114,000 members nationwide.
In addition to CDs ranging in terms from three months to five years, Pen Air also offers personal and business savings and checking accounts, along with various other types of accounts and lending products.
It may be easier to join Pen Air Federal than some of the other credit unions on this list, as all you need is to join the Friends of Navy Marine Corps Relief Society if you don’t have the other affiliations listed on the Pen Air website. There’s no fee to join because Pen Air will make a $1 donation to the organization for you. You’ll also need to make a $25 deposit in a savings account to join.
INSBANK Online is the digital arm of Tennessee-based INSBANK. It offers just two types of accounts: money market accounts and CDs. CDs offer flexible terms ranging from three months to three years, allowing you to meet short- and medium-term savings goals. Accounts come with convenience features such as an online dashboard and private client advocates to answer your questions.
Hiway Federal Credit Union was founded in 1931 to serve transportation workers in Minnesota. Membership is available to anyone nationwide with a $10 donation to the Minnesota Recreation and Park Foundation or another partner organization (plus a $5 deposit to your share savings account). Members have access to thousands of CO-OP shared branches nationwide.
In 1930, a group of Minnesota state employees formed what is now Affinity Plus Federal Credit Union. Anyone nationwide can join with a $25 membership for the Affinity Plus Foundation, which provides scholarships and grants in Minnesota, and a $10 deposit in savings. When it’s time to spend your money, you can transfer funds into a free checking or rewards checking account.
What Is a 3-Month CD?
A certificate of deposit is a type of savings product with a fixed APY and a fixed maturity date. That is, in exchange for leaving your money with a bank or credit union for a set period of time, you’ll lock in a fixed APY for that entire period. So, in the case of a 3-month CD, the APY is fixed for three months. At the end of the term, you’ll get the interest that’s accrued plus your original deposit. Then, you can either withdraw your money, renew the CD, or switch to a different CD. If you withdraw early, you'll often be charged an early withdrawal penalty.
Who Is a 3-Month CD Best For?
If you’re looking for a fixed interest rate product to grow your savings in the short term, a 3-month certificate of deposit (CD) account can provide more favorable and predictable earnings than you’d get in a regular savings account. The national average APY for 3-mo CDs is typically higher than that for savings accounts. And as the rate is fixed, you’ll know exactly how much the CD will earn.
The real benefit might be that it ties up the money for a few months so that you’re not tempted to spend it. You may want a 3-month CD if you have a big expense coming up in a few months. Because the term is so short, 3-month CDs typically have lower APYs than longer-term CDs, so consider how long you can part with your money before choosing a term.
A 3-month CD can also be used as part of a CD ladder strategy, in which you divide up your money to purchase CDs of varying lengths so you’re not losing access to all of it for a long time. When the 3-month CD matures, you'll be able to withdraw your money and can then decide if and how to reinvest it.
What Are the Alternatives to a 3-Month CD?
For a very short-term savings strategy, a 3-month CD can be a good product. It really depends on your personal financial goals and how willing and able you are to lock down some of your savings. Some other alternatives you can consider include:
CDs With Longer Term Lengths
If you’re leaning toward a CD, consider the pros and cons of a longer term. Going with a CD that matures in one year or even five years will provide a higher APY, but you won’t be able to access the money for a longer time frame.
High-Yield Savings Account
Opting for a higher-yield savings account such as online savings account is another safe option if you aren’t comfortable with parting ways with your money for a set time. APYs on these accounts are often higher than what you’ll find among current 3-month CDs. On the downside, savings account rates move with benchmark interest rates. Plus, if you don’t have self-discipline, you might spend any money that’s not locked down.
If you prefer instant account access, we have partnered with the following banks to bring you the high-yield savings and money market account offers displayed in the table.
FDIC. "Weekly National Rates and Rate Caps - Weekly Update." Accessed Dec. 3, 2020.