Five-year certificates of deposit (CDs) are among the most popular CDs because they’re often a bank or credit union’s highest-yielding deposit account. In a falling interest-rate environment, locking in a decent return for five years can be very appealing. Then again, five years is a long time to stash your money away, so you should consider your options carefully.
Every week we comb through the five-year CD rates from over 150 banks and credit unions nationwide to find the highest ones. We track APYs daily but re-evaluate and re-order our list weekly. All accounts that make our cut are insured by either the FDIC or the NCUA and are available to customers nationwide, even if there are a few hoops to jump through to get them.
We also include a few four-year CDs because if you’re building a CD ladder, you’ll need these building blocks as well. (For both lists, we consider CDs with terms close to four and five years, if not exact: 42 to 53 months for four-year CDs and 54 to 66 months for five-year CDs.) In the case of a tie on the APY, we look at the CD with the shortest term and then with the lowest minimum deposit required to earn the APY.
Here are the top four-year and five-year CD rates as of September 17, 2021.
Best Five-Year CD Rates
|Bank or Credit Union||APY||Minimum Deposit||Early Withdrawal Penalty|
|Abound Credit Union (59 months)||1.35%||$500||12 months of interest|
|Superior Choice Credit Union||1.30%||$25,000||12 months of interest|
|Lafayette Federal Credit Union||1.26%||$500||20 months of interest|
|Affinity Plus Federal Credit Union||1.25%||$500||12 months of interest|
|Teachers Federal Credit Union||1.25%||$1,000||All earnings up to 9 months of interest|
|Superior Choice Credit Union||1.25%||$10,000||12 months of interest|
|Superior Choice Credit Union||1.20%||$2,500||12 months of interest|
Best Four-Year CD Rates
|Bank or Credit Union||APY||Minimum Deposit||Early Withdrawal Penalty|
|Abound Credit Union (47 months)||1.40%||$500||12 months of interest|
|Lafayette Federal Credit Union||1.16%||$500||16 months of interest|
|MAC Federal Credit Union||1.15%||$500||3 months of interest|
Formerly known as Fort Knox Federal Credit Union, Abound Credit Union is a Kentucky-based institution with ties to the Fort Knox Army base. Started by 10 people in 1950, Abound claims that it is the largest credit union in the state, with 18 locations and more than 100,000 members. While it caters to military and civil service employees and their families, anyone can join, as long as they pay the $10 one-time membership fee and keep at least $5 in a savings account.
Superior Choice Credit Union (SCCU)—based in Superior, Wisconsin—has been serving the financial needs of its member/owners since 1932. Although this cooperative primarily serves residents and employees of more than 15 counties adjacent to Superior, anyone can join by becoming a member of the American Consumer Council, which costs as little as $8. You’ll also need to establish and maintain a savings account with a minimum balance of $5.
Superior Choice Credit Union offers a full range of financial services including checking, savings, money market, and health savings accounts; bank loans and mortgages; credit cards; and more. SCCU offers CDs with terms ranging from three months to five years. It even has a “Next Gen” or “youth certificate” with a $25 minimum deposit.
Lafayette Federal Credit Union is based out of Rockville, Maryland, and it operates just eight branches scattered around the Washington D.C. area. It’s a full-service credit union, and you can choose from variable-rate and fixed-rate certificates depending on what tickles your fancy.
If you don’t qualify for membership through other means (such as living in the area or working for certain employers), you also can become a member by first joining the Homeownership Financial Literacy Council for $10. You also must keep a $50 balance in a savings account.
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.
Teachers Federal Credit Union was founded in 1953 by a group of teachers on Long Island, New York. Today, the credit union serves over 360,000 members across the United States and has $8.7 billion in assets.
Teachers Federal offers all standard banking products and has 32 branch locations in the New York City metro area.
Anyone can join Teachers Federal Credit Union, and joining only requires $1.
MAC Federal Credit Union offers members financial products like checking, savings, and money market accounts, credit cards, insurance, and more. Originally founded in 1952 to serve the active duty and civil service personnel in Fort Wainwright, Alaska, the credit union is now open to anyone who purchases a two-year membership for $40 to the Association of the United States Army. When applying for the membership, just change the chapter to the Polar Bear Chapter in Fort Wainwright, Alaska.
What Is a 5-Year CD?
A certificate of deposit is a special type of savings account that locks in your money and your interest rate. Also known as a time deposit, a CD requires you to leave your money alone for a specified length of time without adding to or withdrawing from the account.
With a five-year CD, you agree to keep your money with the bank or credit union for a length of five years and in turn, the financial institution will pay you the same APY for that entire five years. Each month or quarter, you’ll earn interest payments that are deposited into the CD and earn even more interest. That continues until the CD matures (reaches the end of its term), or until you withdraw early, which comes with a penalty.
Most 5-year CDs automatically renew for another term length when they mature. If they do, you can still withdraw or add money to the account during a short grace period at the start of the term. Most grace periods are around seven to 10 days in length. After that, the account is locked down again for another five years, and you would have to pay an early withdrawal fee to access your funds any sooner.
Who Is a 5-year CD Best For?
If you have extra money that you won’t need on short notice (i.e., not the money you keep in your emergency fund), a 5-year CD can definitely earn more interest for you than a typical savings account.
Five-year CDs are often the highest-earning and longest-term accounts offered by a bank and credit union. As long as the institution is insured by the FDIC (for banks) or the NCUA (for credit unions), you’re guaranteed not to lose your money (up to $250,000) even if the bank goes under.
Five-year CDs are also a popular choice for CD ladder strategies. One common CD ladder method is to divide your money among five separate CDs with staggered terms (one-year, two-year, three-year, four-year, and five-year) so that one CD matures every year.
Once the one-year CD matures, you reinvest that money into a five-year CD, and you do that every year. That way, all of your money will be stored in high-yield CDs, but you’ll still get access to part of your money once a year if you should need it. You can also include CDs with terms shorter than a year if you want to access your money sooner.
What Are the Alternatives to a Five-Year CD?
Some banks offer CDs with even longer terms, all the way up to 10 years. That’s a big commitment, but you may be able to earn an even higher rate yet with these CDs.
Alternatively, if you won’t need the money you’ve set aside for a really long time (such as before you retire), many people advise investing in the stock market instead. Over the long term, the stock market has vastly outperformed CDs. There are no guarantees though, and unlike with a CD, you could lose money in the stock market.
Many banks offer five-year IRA CDs for you to earn a guaranteed rate on your retirement savings. They have a hidden opportunity cost, though: Your money might not grow as fast as if you’d placed it in a higher-earning (but more volatile) investment like stocks or bonds.
One other option is a high-interest savings account. You’ll have easier access to your money than you would with a CD, and many savings accounts these days pay rates that are competitive with CDs. The downside? The APYs are variable, so you won’t be guaranteed a rate of return.
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.
Consumer Financial Protection Bureau. "What Is a Certificate of Deposit (CD)?" Accessed Sept. 17, 2021.
Office of the Comptroller of the Currency. "My Time Certificate of Deposit (CD) Matured, But I Didn't Redeem It. What Happened to My Funds?" Accessed Sept. 17, 2021.
CreditUnion.gov. "Is My Credit Union Federally Insured and How Do I Know?" Accessed Sept. 17, 2021.
U.S. Securities and Exchange Commission. "Risk and Return." Accessed Sept. 17, 2021.