Best 1-year CD rates of November 2023 (Up to 5.60%)
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BLUEPRINT
Updated 5:06 p.m. UTC Nov. 27, 2023
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Savers willing to temporarily stash their cash can reap solid rewards in this topsy-turvy savings environment where one-year CDs are often yielding as much as, or more than, longer-term offerings. To determine the best one-year CD products, we evaluated more than 140 certificates of deposit (CDs) and the financial institutions offering them, looking at interest rates, customer ratings and more, to determine the best one-year CDs.
Annual percentage yields (APYs) and account details are accurate as of November 20, 2023.
Why trust our banking experts
Our team of experts evaluates hundreds of banking products and analyzes thousands of data points to help you find the best product for your situation. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.
- 140 CDs from 84+ financial institutions reviewed.
- 4 levels of fact checking.
- 50+ data points analyzed.
Best 1-year CD rates
My eBanc Online Time Deposit
Michigan State University Federal Credit Union Certificate
Connexus Share Certificate
Sallie Mae Bank CD
PenFed Money Market Certificate
Bread Savings CD
First National Bank of America
Synchrony Bank CD
Citibank Fixed Rate CD
Compare the best CDs
| Institution | Star rating | 1-year APY | Minimum Balance |
|---|---|---|---|
| My eBanc | 4.7 | 5.50% | $5,000 |
| Michigan State University Federal Credit Union | 4.7 | 4.25% | $500 |
| Connexus | 4.7 | 5.01% | $5,000 |
| Sallie Mae Bank | 4.6 | 5.25% | $2,500 |
| PenFed | 4.6 | 5.25% | $1,000 |
| Bread Savings | 4.5 | 5.60% | $1,500 |
| First National Bank of America | 4.5 | 5.15% | $1,000 |
| Synchrony Bank | 4.4 | 5.30% | $0 |
| Citibank | 4.4 | 4.30% | $500 |
Methodology
The most important category for a one-year CD is the APY; an account needs to offer a high rate in order to be considered. That’s why we tilted our methodology so heavily in that direction. A bank can offer the best customer service in the world, but if they don’t provide competitive rates, then you’ll have trouble meeting your financial objectives.
Non-APY factors still played a part, with customer experience being an important factor. To round out the score, we analyzed CD accounts further, valuing those with lower minimum deposits, daily compound interest schedules (rather than monthly) and those that are nationally available (think credit unions with an open versus limited membership).
We looked at over 140 CDs offered by 84 financial institutions and evaluated them to create a star rating for each. An institution with a perfect score of 100 would get five stars. One with a score of 80 would get four stars and so on. Here are the categories we analyzed and how we weighted each.
- APY: 75%
- Customer experience: 5%
- Minimum deposit: 5%
- Compound interest schedule: 5%
- Digital experience: 5%
- Available terms: 3%
- Availability: 2%
We monitor over 80 financial institutions, including Capital One, PenFed, Discover, Chase, TD Bank, Marcus by Goldman Sachs, TIAA Bank, Colorado Federal Savings Bank and American Express Bank.
Why some banks didn’t make the cut
We used the same report card to judge each CD and not every bank had one of the best one-year CDs. You’ll notice that many of the largest banks in the country didn’t make the cut.
This is primarily because larger banks don’t need to attract customers by offering great rates. They already have household names that Americans have known for generations, whereas smaller institutions offer competitive CD rates to make a splash and attract customers.
Those that did make our list graduated from our methodology rating with flying colors.
National average interest rate for CDs
Several factors influence CD rates, including the federal fund rate set by the U.S. Federal Reserve, and the type and the length of the CD.
“Generally longer-term CDs have higher rates to compensate investors for tying their funds up longer,” said Seth Mullikin, a CFP at Lattice Financial in Charlotte.
As of November 20, 2023, the average national deposit rate for a one-year CD was higher than any other, according to the Federal Deposit Insurance Corporation (FDIC).
| CD Term | National Deposit Rate (As of November 20, 2023) |
|---|---|
| 1 month CD | 0.23% APY |
| 3 month CD | 1.62% APY |
| 6 month CD | 1.43% APY |
| 12 month CD | 1.85% APY |
| 24 month CD | 1.55% APY |
| 36 month CD | 1.39% APY |
| 48 month CD | 1.32% APY |
| 60 month CD | 1.39% APY |
As of November 17, 2023, the current national high rate for a 12-month CD is 5.70% APY according to Curinos data.
Are 1-year CD rates going up?
Yes. In 2022, after more than a decade of low rates, the Federal Reserve increased the federal fund rate seven times in an effort to stamp down national inflation. When the Federal Reserve changes the federal funds rate, CD rates typically follow.
Financial institutions use the federal funds rate to help determine how much to charge in interest for lending products and how much to offer in interest on deposit accounts such as savings accounts and CDs. As rates spike, consumers face higher costs of borrowing, but, on the flip side, see a boost in their interest earnings.
The following table outlines how large these recent rate increases were.
| FOMC Meeting Date | Rate Change (bps) | Federal Funds Rate |
|---|---|---|
| March 17, 2022 | +25 | 0.25% to 0.50% |
| May 5, 2022 | +50 | 0.75% to 1.00% |
| June 16, 2022 | +75 | 1.5% to 1.75% |
| July 27, 2022 | +75 | 2.25% to 2.5% |
| Sept. 21, 2022 | +75 | 3.00% to 3.25% |
| Nov. 2, 2022 | +75 | 3.75% to 4.00% |
| Dec. 14, 2022 | +50 | 4.25% to 4.50% |
| Feb. 1, 2023 | +25 | 4.50% to 4.75% |
| March 22, 2023 | +25 | 4.75% to 5.00% |
When is a 1-year CD a good idea?
CDs are a great way to safely earn interest on money you aren’t currently using.
“CDs can be a good place to invest cash for individuals who are saving for short-term goals,” said Desiree Kaul of Main Street Planning in Satellite Beach, Fla. If you’re saving up for a car or a vacation, a CD may be an ideal option.
You can own multiple CDs with staggering maturities, which is called CD laddering. This gives you access to cash and the ability to save in longer term fares should rates rise.
1-year CD vs high yield savings account: how they work
CDs tend to earn higher interest rates than savings accounts, but these increased earnings come with a tradeoff. You have to keep the cash in the CD for a set period of time and can’t remove it until it matures, otherwise you’ll likely pay an early withdrawal penalty.
A CD isn’t a great option for storing the cash that you may need to access in a hurry. High-yield and online savings accounts allow much greater flexibility. As liquid accounts, they’re highly accessible, you can withdraw from them at any time, which makes them a perfect place to store emergency savings.
The financial rule of thumb is to have three- to six-months worth of expenses in a savings account so you’re able to support yourself and your family in case you lose your job or a disaster strikes. Once you have that, CDs are a great way to expand your deposits.
How to open a 1-year CD
1. Chose a CD provider
Research the best CD rates and pick the bank or credit union you want that offers the highest rate you can get.
As you look at the best rates, you’ll find that many of the big, brick-and-mortar banks don’t offer the most competitive yields. But they can offer great convenience, especially if you’re already a customer.
To help you if that’s the case, we reviewed CD rates for some of the largest banks in the nation:
2. Set up an account
Even if you’re already a customer of the CD provider you choose, you’ll need to set up your CD account by logging in and clicking the appropriate buttons.
If you’re becoming a customer or a member with this institution for the first time, you’ll need to provide some personal information, including your name, date of birth, contact information and government ID number, such as your Social Security number or Taxpayer Identification number.
You’ll also likely be asked to choose how and when you want the interest that your CD earns. Many institutions give you options of receiving the interest monthly, quarterly or at the end of the term, when the CD matures.
3. Transfer funds
To fully open a CD, you need to put money in it. You’ll have to meet any required minimum deposit amount, which commonly ranges from $500 to $2,000 but can be as low as “none” and as high as $100,000+ for jumbo CDs.
4. Sign paperwork
With the money ready to go, the last thing to do is to sign paperwork, agreeing to terms and conditions. The contract will outlay the relationship between you and the bank and state the APY your deposit will earn.
How are CDs taxed?
The money you earn on a CD counts as taxable income in most situations.
“CDs are taxed at both the state and federal levels,” said Mullikin.
If you earn more than $10 in CD interest, you should receive a tax document from your CD provider, either Form 1099-INT or Form 1099-OID. Whether you receive the forms or not, you are still responsible for reporting all taxable income, otherwise you risk paying backup withholding and a penalty.
However, if your CDs are part of your individual retirement account (IRA), then your taxes will be different. “You can have a CD in an IRA, traditional or Roth—then the rules are based on IRA taxes,” said Nicholas Bunio, CFP in Downingtown, Pa.
Consider alternative CD terms
When looking for a one-year CD, don’t completely discount other terms. With CD rates up across the board, other CDs can be great, low-risk investments.
Even if a longer-term vehicle has a slightly lower APY, you would earn more in interest over time.
For example, $5,000 invested in a one-year CD with a 4.00% APY would earn more than $200. A two-year CD with a 3.80% APY would earn nearly $400.
Why you should pay attention to odd terms
Providers sometimes run specials on CDs with an unusual amount of months, such as 10-, 11-,13- and 14-month CDs. By going a month or two over or under, you could get a higher APY.
If you have a cut-off date for when you need your cash, keep in mind that you could string together shorter-term CDs and still meet the deadline, such as two sequential six-month CDs or, for the long-term saver, two five-year CDs.
A higher CD rate is always better. As of October 16, 2023, the national average rate on a 12-month CD is 1.79% APY. However, the lowest rate on our list above is right around 4.00% APY.
No one knows what CD APYs will look like in six months for sure. But, choosing a six-month CD gives you more flexibility. When it matures in half a year, you can move your funds into another CD with a higher rate, if rates have gone up, or you could invest it in a completely different way.
Almost everyone should have a savings account. When something happens, like if you break an arm or need new tires, you can cover the costs from your savings and don’t have to get a loan. If you want to get a CD in addition to a savings account, that’s great.
As of November, Bread Savings has the best 12-month CD rate with a 5.60% APY and a $1,500 minimum deposit.
Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.
Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.
