We review more than 150 banks and credit unions to find the best rates available nationwide for 1-year CDs. We track annual percentage yields and re-evaluate the list every weekday. All accounts are available to the public and are insured by either the Federal Deposit Insurance Corp. or the National Credit Union Administration. One-year CDs are an easy way to earn some extra interest on a chunk of your savings, while also safeguarding against you withdrawing it on a whim.
For this list, we considered products that lock in deposits for 11 to 14 months. Our rankings are based primarily on the best APY. In the case of a tie, we then look at the CD with the shortest term, then with the lowest minimum deposit required to earn the APY. From there, we compare the penalties for early withdrawal. These factors allow us to ultimately decide which banks earn their spots in our rankings. Here are the top 1-year CD rates as of Oct. 20, 2020.
APYs are changing rapidly amid widespread uncertainty about the economy and financial markets. The Balance is monitoring rates and updating them accordingly.
Best 1-Year CD Rates
|Bank or Credit Union||APY||Minimum Deposit||Early Withdrawal Penalty|
|USAlliance Federal Credit Union||1.05%||$500||6 months of interest|
|Financial Resources Federal Credit Union
|1.01%||$500||180 days of interest|
|Bank of Baroda
(1 year and longer)
|1.00%||$1,000||1% of interest rate|
|MAC Federal Credit Union||0.95%||$1,000||1 month of interest|
|CommunityWide Federal Credit Union||0.95%||$1,000||Complex formula; exercise caution|
|State Bank of Texas||0.95%||$25,000||30 days of interest|
|Hiway Federal Credit Union
|0.95%||$25,000||3 months of interest|
|Pen Air Federal Credit Union||0.90%||$500||6 months of interest|
|Credit Union of Denver
|0.90%||$5,000||3 months of interest
|State Department Federal Credit Union||0.85%||$500||All interest up to 180 days|
Here are details about some of the institutions on our list.
USAlliance Federal Credit Union began in 1966 by serving employees of IBM, but it has since expanded eligibility to employees of American Express and PepsiCo as well as to members of many organizations such as the American Society of Composers, Authors, and Publishers, the Aircraft Owners and Pilots Association, the New York Historical Society, and Tread Lightly. Additionally, the credit union serves multiple neighborhoods and communities throughout New York, Massachusetts, Connecticut, and New Jersey, along with members and employees of many houses of worship, colleges, and universities.
Join the American Consumer Council at no cost to gain membership to the credit union. You’ll also need to open either a checking or savings account and deposit at least $1.
Financial Resources Federal Credit Union was chartered in 1950 to serve employees of Ethicon Suture Laboratories, a division of Johnson & Johnson, in New Brunswick, New Jersey. Previously known as Ethicon Employees Federal Credit Union, it changed its name in 2000.
Membership is available nationwide to anyone who joins the American Consumer Council, which costs a minimum of $8. A lifetime ACC membership costs $15.
The Bank of Baroda probably isn’t a name you’ve likely heard of before. That’s because it’s a multinational bank originating in India, and its primary business is in helping Indian expats send money back to their home country. Bank of Baroda only dips its toes in the deposit accounts world by offering business bank accounts and personal CDs with 1-month to 5-year terms.
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.
CommunityWide Federal Credit Union was founded in 1967 and is based in northern Indiana. If you don’t meet its employment-based membership criteria or have a family member who’s already a member, you easily can join by becoming a member of a partner organization such as the Marine Corps League of St. Joseph Valley, which starts at $15 per year. You must deposit $5 in savings. It’s also part of the CO-OP shared branching network.
The State Bank of Texas was established in 1987 with the goal of serving the lending needs of immigrants. A family-owned bank, it has four branches in Dallas and the surrounding area in addition to branches in four Chicago locations.
Online and mobile banking options allow customers to open accounts from anywhere. In addition to CDs, the State Bank of Texas offers checking and money market accounts.
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 & 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.
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 113,000 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.
The Credit Union of Denver began in 1931 with eight members and $40 and has since grown into an institution with nearly 64,000 members and more than $880 million in assets.
Membership is available to anyone who lives or works in Adams, Arapahoe, Boulder, Denver, Douglas, or Jefferson Counties in Colorado, or anyone who works for the Regional Transportation District, the National Renewable Energy Laboratory, or any businesses that work with the RTD or NREL. Memberships also are available to family of members and to students at select schools and colleges. The cost of membership is $5.
Eight U.S. State Department employees helped launch State Department Federal Credit Union in 1935. Headquartered in Old Town Alexandria, Virginia, the credit union offers membership to anyone associated with dozens of partner organizations, in addition to State Department employees. As of October 2020, the credit union boasted more than 86,000 members and $1.9 billion in assets.
What Is a 1-Year CD?
A certificate of deposit (CD), offered by banks and credit unions, provides a fixed interest rate (typically higher than other account types) in return for the account holder agreeing to leave the deposit for a set amount of time. Because the rate is fixed, the account holder knows exactly how much the CD will earn when it matures. For a 1-year CD, the account holder agrees not to touch the deposit for one year. At the end of the term, the full interest will be added to the deposit amount. The customer then has the option to withdraw the full amount or renew/change the CD.
Who Is a 1-year CD Best For?
A 1-year CD is appropriate for someone who wants to earn more interest than a typical savings account would offer, although occasionally there are savings accounts with even better rates than 1-year CDs. However, savings rates are variable, so if you think rates are likely to fall and you want to lock in a good one today, go with a CD.
Remember, you need to be comfortable with tying up the money for one year. That’s because there usually are early withdrawal penalties, and the last thing you want to do is lose out on those earnings.
A common reason to consider a 1-year CD might be if you’re saving for a trip or big event to take place next year. The idea is that it’s a short-term investment. Opening a CD helps you avoid the temptation of spending the money, and lets you earn a bit of interest while you wait for it to mature.
Typically, the longer the term, the higher the rate you’ll receive. A 1-year CD can be especially helpful with longer-term savings goals if you’re building a CD ladder. With a CD ladder, you buy CDs of varying lengths to mitigate the risks of locking all your money into one long-term CD.
What Are the Alternatives to a 1-Year CD?
If you’re looking for a savings option, a 1-year CD is just one of them. When choosing the best approach for you, the key is to think about your current financial situation, your goals, and your saving/spending habits. Beyond a 1-year CD, there are some other options to consider.
Explore Different CD Terms
If you know you want to go the CD route, you may decide to go with a shorter or longer term, depending on your needs. Shorter-term CDs allow you access to your money sooner but probably will have a lower APY. Longer terms likely will earn more but will separate you from your money for a bigger stretch of time.
High-Yield Savings Accounts
If you’d rather not tie up your money, you might consider an online savings account. Some APYs are comparable to or even higher than 1-year CD APYs. The difference is that savings account rates can change at any time. Also, if you lack self control when it comes to spending, the easier access that a savings account affords you might not work in your favor.
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.