Two-year CDs typically earn a competitive annual percentage yield, so they may be a good option for someone saving money for an event or purchase that’s two years out, like a down payment for a house or maybe a wedding.
We review more than 150 banks and credit unions to find the best rates available nationwide for 2-year CDs. We track APYs and re-order 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.
For this list, we considered products that lock in deposits for 21 to 29 months and chose the best. Our rankings are based primarily on the best APY, but in the case of a tie, we look at the CD with the shortest term, and then the lowest minimum deposit required to earn the APY. From there, we compare the penalties for early withdrawal. Here are the best CD rates for 2-year terms as of Nov. 27, 2020.
APYs are changing rapidly amid widespread uncertainty about the economy and financial markets. The Balance is monitoring rates and updating them accordingly.
Best 2-Year CD Rates
|Bank or Credit Union||APY||Minimum Deposit||Early Withdrawal Penalty|
|Parke Bank||1.16%||$500||6 months of interest|
|MAC Federal Credit Union||1.10%||$1,000||3 months of interest|
|Evansville Teachers Federal Credit Union||1.04%||$1,000||6 months of interest
|Georgia's Own Credit Union||1.00%||$500||6 months of interest|
|Georgia's Own Credit Union
|0.97%||$500||6 months of interest|
|INSBANK Online||0.95%||$2,500||10 months of interest|
|Hiway Federal Credit Union
|0.95%||$25,000||6 months of interest|
|Superior Choice Credit Union||0.95%||$25,000||6 months of interest|
|Abound Credit Union||0.90%||$500||3 months of interest|
|State Department Federal Credit Union||0.90%||$500||All interest up to 180 days|
Here are details about the institutions on our list.
Parke Bank was founded in 1999 and is headquartered in Washington Township, New Jersey, south of Philadelphia. It has five branches in southern New Jersey and two in Philadelphia, and primarily serves individuals and businesses in those areas. However, anyone with digital access can open an account through Parke24 Online Banking.
In addition to CDs, Parke offers checking, savings, money market, and IRA accounts. Mortgages, auto loans, and other lending products also are available.
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.
Evansville Teachers Federal Credit Union launched in 1936 when a small group of teachers decided to pool their savings and offer loans. It began with a small field of membership including the board of education and Evansville College in Evansville before incorporating other organizations when it merged with Owensboro Public Schools Federal Credit Union in 1992. Its consumer offerings include checking, savings, and money market accounts, loans, and CDs with terms ranging from three months to six years.
To become a member, you’ll either need to be related to or live with a current member or work for or become a member of an organization within the credit union’s field of membership. For example, you can join the Mater Dei Friends and Alumni Association (MDFAA) with annual dues of just $5. You’ll also need to open a savings account and maintain a $5 deposit.
Based out of Atlanta, Georgia’s Own Credit Union has been around since 1934 and has about 200,000 members and $3 billion in assets as of September 2020. While living in certain parts of Georgia is one way to qualify for membership, you also can join by first becoming a member of the Getting Ahead Association for $5 or Georgia’s Own Foundation for $10. As with most other credit unions, you’ll also need to keep at least $5 in a savings account in order to keep your membership active.
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.
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 boasts 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.
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 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.
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 November 2020, the credit union boasted more than 86,000 members and $1.9 billion in assets.
What Is a 2-Year CD?
If you’re looking for a fixed interest rate product to help grow your savings, a certificate of deposit (CD)—also known as a share certificate at credit unions—can provide more favorable and predictable earnings than you’d get in a regular savings account. The catch is that account holders have to make the deposit and leave it untouched for a set term. With a 2-year CD, you must leave your deposit untouched for two years. At the end of the term, the full interest that accrued is added to the original deposit. You may then make a withdrawal within a specified window or decide to renew or open a new CD.
If you don’t want to tie up your money for a full 24 months, you may be able to select a shorter-term CD or certificate product at another bank or credit union. Terms may range from 21 to 29 months, which may better suit your financial goals.
Who Is a 2-Year CD Best For?
A 2-year CD is appropriate for anyone who wants to put a chunk of savings to work for them. Since the APY is fixed and can be higher than what you’d get with a savings account, you can calculate exactly how much you’ll earn.
Be mindful that you can’t touch that money for the full 2-year term without being penalized and losing part of the interest you’ve earned.
Some scenarios that might be a good fit for a 2-year CD include if you’re saving up for a large purchase like a home or bucket-list trip. The CD may help ensure that you won’t spend that money, plus give you a few more bucks on top of the principal balance.
While longer-term CDs usually have higher APYs, a 2-year term offers a sweet spot in which you’re earning good rates but don’t have to give up access to your funds for a longer period of time. It’s also a product to consider if you’re using a CD ladder strategy, in which you purchase CDs of varying lengths so as not to lock down all of your money in a single long-term account.
What Are the Alternatives to a 2-Year CD?
For a short-term savings strategy, a 2-year CD may be a good solution (assuming two years isn’t too far off for you). Before opening any type of account that essentially ties up your assets, it’s smart to consider your personal finance goals and whether you can live without access to those funds for a set period of time.
Explore Different CD Terms
If you’re leaning toward a CD, look at APYs and other terms to decide if a shorter or longer-term might work better for you. Shorter-term CDs allow you to touch your money again sooner but may not earn as much as their long-term siblings.
High-Yield Savings Accounts
If the thought of tying up your money stresses you out, an online savings account may be a better fit. Some APYs are in line or close to what you’ll find among 2-year CD APYs. However, just note that savings account rates are variable, so you don’t have that fixed-rate assurance. On the other hand, if you don’t have the discipline to stay away from dipping into a savings account, a CD might help.
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.