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 March 2, 2021.
Best 2-Year CD Rates
|Bank or Credit Union||APY||Minimum Deposit||Early Withdrawal Penalty|
|USAlliance Federal Credit Union||1.00%||$500||12 months of interest|
|MAC Federal Credit Union||1.00%||$1,000||3 months of interest|
|Lafayette Federal Credit Union||0.90%||$500||9 months of interest|
|TruStone Financial Credit Union||0.85%||$500||12 months of interest|
|Evansville Teachers Federal Credit Union||0.85%||$1,000||6 months of interest ($100 minimum)|
|Alabama Credit Union||0.81%||$500||6 months of interest|
|Connexus Credit Union||0.81%||$5,000||6 months of interest|
|Abound Credit Union||0.80%||$500||3 months of interest|
|Pen Air Federal Credit Union||0.80%||$500||6 months of interest|
|CommunityWide Federal Credit Union||0.80%||$1,000||Complex formula; exercise caution|
Here are details about 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 for the first year to gain membership to the credit union; you’ll pay $8 annually thereafter. You’ll also need to open either a checking or savings account and deposit at least $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.
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.
With 14 locations across Minnesota and Wisconsin, TruStone Financial Credit Union has come a long way since it was founded by eight Minneapolis teachers in 1939. The credit union offers a full suite of personal and business banking services including checking, savings, loans, and credit cards. CD terms range from three months to five years.
Anyone who doesn’t meet eligibility based on employer or location can become a member by making a $10 donation to the TruStone Financial Foundation. You’ll also need to open a savings account with a $5 deposit.
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.
Alabama Credit Union was founded in 1956 to serve the University of Alabama. Anyone nationwide can join after becoming a member of several organizations. For example, you can join the Secret Meals Association, which helps to feed hungry children, with at least $10. You must also keep $5 in savings.
Connexus Credit Union serves members nationwide through online banking and as a member of the CO-OP shared network. CO-OP and MoneyPass ATMs also are surcharge-free for members. The credit union is based in Wisconsin and has branches there as well as in Minnesota, Ohio, and New Hampshire.
Membership is available to residents of several communities in Minnesota, Wisconsin, and Ohio, and to anyone affiliated with one of multiple organizations, employers, or schools, including the Connexus Association, which anyone can join for $5.
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.
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.
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 can easily 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.
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.