Two-year CDs typically earn a competitive annual percentage yield (APY), so they may be a good option for anyone saving money for an event or purchase that will happen in at least two years, like a down payment for a house or maybe a wedding.
Each week, we review over 150 banks and credit unions to find the best rates available nationwide for 2-year CDs. We track APYs daily but re-evaluate the list weekly. All accounts are available to the public and are insured by either the FDIC or NCUA.
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 March 26, 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|
|Chevron Federal Credit Union (Special Rate)||2.20%||$500||6 months of interest|
|Spectrum Federal Credit Union (Special Rate)||2.20%||$500||6 months of interest|
|Merrick Bank||1.95%||$25,000||Greater of 2% of balance or 7 days of interest|
|Hughes Federal Credit Union (29-month)||1.92%||$1,000||6 months of interest ($50 minimum)|
|American Express||1.90%||$0||9 months of interest|
|Pen Air Federal Credit Union||1.90%||$500||6 months of interest|
|Barclays||1.85%||$0||6 months of interest|
|Marcus by Goldman Sachs||1.85%||$500||6 months of interest|
|Premier America Credit Union||1.85%||$10,000||6 months of interest|
|Georgia’s Own Credit Union||1.80%||$500||6 months of interest|
Here are details about some of the institutions on our list.
With more than 100,000 members worldwide, Chevron Federal has been operating since 1935. It has more than 5,000 shared branch locations, and anyone can become a member by joining an affiliated organization with membership fees as low as $15. You’ll also have to get a savings account with Chevron Federal, keeping at least $25 in it.
In addition to CDs with terms as long as five years, Chevron Federal offers many financial products, including savings and checking accounts, IRAs, loans, and credit cards.
Spectrum Credit Union merged with Chevron Federal in 2012. Spectrum does, however, operate independently in areas not served by Chevron, which is why they are included on our list separately.
Spectrum was originally founded as Bechtel Employees Federal Credit Union. Just like Chevron Federal, if you do not qualify for membership through your employer or other means, you can join one of the non-profit associations linked to the credit union for as little as $15. And you’ll have to maintain a savings account with a minimum deposit of $25.
Spectrum’s CDs range from 3-month term to 5-year terms. Members can also get a full slate of bank accounts, as well as loans, credit cards, and insurance.
Merrick Bank has been around since 1997, and primarily specializes in credit programs as a major issuer of Visa credit cards. The bank also provides personal loans and loans for RVs and boats and other recreational vehicles.
As far as CDs go, other terms offered include six months, 18 months, and two years.
Hughes Federal Credit Union was founded in 1952 to serve employees of the Hughes Aircraft Company (yes, the very same Howard Hughes of aviation legend). Today it’s based in Tucson, Arizona, and has over 132,000 members. Although it only operates branches in Arizona, you can open an account from anywhere online, provided you meet the membership criteria. These include living, working, or attending school in Tucson, being employed by a certain partner company, or being related to an existing member of the credit union.
If you don’t qualify in one of those ways, you can also join by donating at least $10 to one of four organizations, such as the Friends of the Oro Valley Library. You’ll also need to keep a relatively high amount—at least $50—in a savings account.
Amex is primarily known for its credit card business, but American Express Bank does also offer high-yield savings and certificate accounts. CD terms range from six to 60 months and have no minimum deposit requirements, which is unusual. You won’t want this as your primary bank because there is no checking account, but the CD and savings rates tend to be good, especially for a well-known bank.
It may be easier to join Pen Air Federal than some of the other credit unions on this list, since all you need is to join the Navy Marine Corps Relief Society if you don’t have the other affiliations listed. Pen Air will even make a $1 donation to the organization for you. You’ll also need to make a $25 deposit in a savings account to join.
Founded in 1936, Pen Air Federal Credit Union is the largest and oldest local credit union in Pensacola, Florida. While there are only 15 locations in Northwest Florida and Southeast Alabama, there are more than 109,000 members nationwide.
In addition to CDs ranging in term from three months to five years, personal and business savings, checking, and various accounts and lending products are also available.
Barclays Online Banking is headquartered in Wilmington, Delaware, and is one of several divisions of Barclays, the British banking behemoth that traces its roots back to the 1690s. Customers can choose from online savings accounts as well as certificates that range in length from three months to five years.
Marcus by Goldman Sachs was launched by its parent company back in 2016. It’s designed to be an online lending and deposits bank. Customers can apply for no-fee, fixed-rate personal loans, high-yield online savings accounts, and CDs. CD terms are available with terms from six months to six years. One interesting feature is if the APY increases in the first 10 days of account opening, you’ll get your rate bumped up to the highest rate.
Premier America Credit Union, based in Chatsworth, California, boasts over 100,000 members and $2.5 billion in assets. Meeting the membership requirements is relatively easy. If you don’t live, work, or study in the qualifying areas of California, you can open an account by joining the Thousand Oaks Alliance for the Arts, which offers free membership. You must also keep at least $5 in a savings account.
With 210,000 members, Georgia’s Own Credit Union has come a long way since it was established in 1934. In fact, today it’s one of the largest credit unions in Georgia.
You can become a member even if you’re not a Georgia resident, however, by joining the Getting Ahead Association, which costs $5. You’ll also have to deposit a minimum of $5 in an account.
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 10-day window or decide to renew or open a new CD.
If you don’t want to tie up your month 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, though, or you may be penalized and lose 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 is a good “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 into one 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're looking to earn interest on your money, but in an account more liquid than a CD, we partnered with QuinStreet to bring you the following savings and money market account offers.