Top Long-Term CD (Certificate of Deposit) Rates

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Certificates of deposit are an important financial planning tool because they represent the safest investment you can make. You deposit funds, you get a guaranteed interest rate until the CD matures. You have to deal with inflation risk, that the rate of inflation could outpace your return, and the risk that you may need the funds. If you close a CD early, you will usually have to pay an interest penalty unless it’s a no penalty CD.

Personally, I don’t deposit funds into a long term certificate of deposit, especially with these CD rates, because I’m at an age where it doesn’t make sense from a financial planning perspective. We’re in our twenties so we’re thinking about things like starting a family and buying a home so a three-plus year CD wouldn’t make sense because our situation is changing so quickly. However, once it stabilizes, I see the value in saving money in longer term CDs as a way of planning for the future.

What I do use long term CD rates for is when I make investment decisions. CDs represent a 100% safe “investment” opportunity, so any potential investment is compared against a three or five year CD. If I can get a guaranteed 3% for a 5 year CD, why would I want to invest in something that has risk and only returns 3%?

Top Long-Term CD Rates

The following table lists the top CD rates for maturities of more than 24 months. In general, most will be 5 or 6 year CDs since the longer the maturity the higher the rate.

All of the banks on this list are FDIC insured up to $250,000.

{ 19 comments, please add your thoughts now! }

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19 Responses to “Top Long-Term CD (Certificate of Deposit) Rates”

  1. zapeta says:

    I didn’t know anyone was paying close to 4% these days. I wish normal savings account rates would start to creep up…

  2. Jim says:

    Many of these are 5 year CDs, so 4% isn’t unreasonable considering your money is locked away for such a long period of time.

  3. lostAnnfound says:

    One of my kids’ CDs is coming up for renewal next month. Right now our CU is offering 1.61% for 9 month CD up to 2.68% for 48-72 month CD. Should a teenager have a long-term CD? Or would short-term be better? Or something else altogether?

    • Jim says:

      My wife had CDs when she was a kid and she always went with the longer ones. She said it was nice to have them mature when she went off to college so she could pay for things herself, rather than rely on Mom and Dad.

    • nickel says:

      Teenagers are really no different than anyone else (other than perhaps a 3-5 year time horizon due to college tuition payments). If rates are low and you expect them to go higher, you probably don’t want to lock in for a long term. If rates are high and you expect them to go lower, you *should* lock in for a longer period.

      • lostAnnfound says:

        Good point about looking at the time-frame until college. This child has five more years till then, so a long-term CD should work fine. The older has just two years to go, so we will take the into consideration when her CDs mature next month.

  4. reinkefj says:

    For the savings component of a portfolio, my wife and I use a quarterly five year IRA CD ladder for some “mad money”. Yeah, I know “Certificates of Depreciation”. Four quarters over 5 years for 20 “buckets” across three different banks. Portfolio has an average return of 4.6%. It represents less than 2% of our total estate. It’s a “teachable moment” for my wife on what to do if something happens to me like death or disability. She can run a CD ladder and not get cheated by all the “salesmen” out there.

  5. Bradford says:

    There are several other excellent banks with top rates at present: check out

    USAA (in San Antonio; originally founded for members of the military, but now their banking services are open to anyone: call up and request a member number, and you’re on your way)
    Hudson City Savings Bank
    and, a little further down, Nationwide.

  6. eric says:

    Yeah long term CDs don’t make sense for me right now. Plus the rates are…. :/

  7. D. Roddy says:

    I’m just curious to know why USAA isn’t on this listing…I use USAA for CDs and their 60 month CD rate currently is 3.61%! In my opinion USAA is overall better in all rates regardless of the time frame you are looking to invest in CDs.

  8. daemondust says:

    It’s amazing how different these long term CD rates are between banks. Why would someone put their money in a 1.75% interest 60 month CD at ING Direct when they could get 3.25% at Ally with the same minimum deposit requirement? With a $1000 deposit, that’s a difference of $85 in interest.

    Also, don’t be too fixed on the length. While it does mean you’re guaranteed that return for the entire length of the deposit, many banks seem to also offer ‘teaser’ rates for shorter time periods. My credit union, for example is offering a 1.75% on a 13 month, and 2.1% on a 25 month deposit. Their regular schedule doesn’t get past 1.75% until longer than 2 years, and doesn’t come close to the 2.1%, even at 6 years. They still aren’t the best rates, but an example that shorter periods might have higher teaser rates to try to get people who are wary of their money being locked up for half a decade or longer.

  9. Soccer9040 says:

    Has anyone put together a list of shorter CDs? I have some 12 month CDs in a ladder (some are 4.5% 12 month ones from last year) that are coming to term and I don’t really want to renew at 1.5% (ING), but I might have to.

  10. Chris says:

    I am afraid to buy long term cds now as rates may go back up while my money sits there. What is a common penalty for an early withdrawal or closeout on a cd?

    • Jim says:

      It’s usually 3 months for CDs of under a year, 6 months for CDs with maturities of a year or more. Each bank does it differently though so you have to check to be sure.

  11. Ed says:

    I get 2% in my saving account but I can get 3% in 30 month CD. I don’t know whether I should lock into 30 month for 1%. The penalty is 6 month interest. Personally I don’t believe rates would go up anytime soon. Lets assume that after 6 months rates go to 2.25% and 6 months later it goes to 2.5% and in 2 years it goes to 4%. The average that you might get might be less than 3% that I can get in a 30 month CD.

  12. Anonymous says:

    Look for CD’s with 10%-20% return

  13. aua868s says:

    thinking about giving ally bank a try…but the no-penalty 9 month cd is stopping me from locking my money for 60 months!

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