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The average rate for a 1-year CD in the US is 1.59% APY (Annual Percentage Yield). However, some of the best online banks pay up to 5.28% APY on a 1-year CD.

A 1-year term may be a good choice if you’d like to maintain a solid interest rate for a relatively short time. If you choose a 1-year CD, you’ll also have the chance to earn a higher interest rate if rates are up in a year. If you’re also interested in other CD term lengths, check out our overall best CD rates guide.

Best 1-year CD Rates

These are our picks for the best 1-year CD rates. Our top picks for CDs are protected by FDIC or NCUA insurance. Although Silicon Valley Bank, Signature Bank, and First Republic Bank have recently been shut down, keep in mind money is safe at a federally insured financial institution. When a financial institution is federally insured, up to $250,000 per depositor is secure in a bank account.

Compare 1-year CDs

Expert Advice on Choosing the Best CD

To learn more about what makes a good CD and how to choose the best fit, four experts weighed in:

Insider

How can you be sure you’re picking the right bank?

Tania Brown, certified financial planner at SaverLife, says the most important thing is FDIC insurance, which protects your money if the bank were to collapse. For credit unions, the equivalent is NCUA insurance. Next, she says, consider the experience you want to have with your bank: Do you want to walk in and talk to a person? Then you need a bank with a local branch. Are you fine never speaking to someone in person? Then an online bank will work for you. Do you write checks (or not)? Then you need an account that comes with checks.

Sophia Acevedo, a certified educator in personal finance and banking reporter for Personal Finance Insider, adds that it’s a good idea to include costs in your list of priorities. For instance, is there a monthly fee for the account you want? If so, what are the requirements to waive it — and can you meet them? If it’s important that you earn interest, you’ll want to choose a bank and an account that pays a higher interest rate than the average bank account.

How do you choose between all the available CD terms?

Roger Ma, certified financial planner with lifelaidout® and author of “Work Your Money, Not Your Life”, says you should start by deciding when you need the money, then looking at available rates for CDs with similar timing.

Knowing how you’ll use the money you plan to put in a CD is central to the one you choose, says Mykail James, MBA, certified financial education instructor at BoujieBudgets.com. Perhaps it’s a house fund — in that case, if you know that you want to buy a house in two years, you’ll need to make sure your CD term ends by then.

When do you use a CD instead of a high-yield savings account or money market account?

Brown says you should know two things to help make this decision: how much money you’ll be putting in, and how much you plan to interact with that money. If you’re going to need to make transactions before the term of a CD ends, you’ll have to choose a high-yield savings or money market account.

Acevedo adds that both the high-yield savings account and money market account can be good options for an emergency fund or short-term savings goals. The savings accounts tend to offer strong interest rates, while money market accounts typically offer more access to your money, like paper checks or debit cards.

Methodology: How did we choose the best 1-year CDs? 

Personal Finance Insider’s mission is to help smart people make the best decisions with their money. We understand that “best” is often subjective, so in addition to highlighting the clear benefits of a financial product or account — a high APY, for example — we outline the limitations, too. We spent hours comparing and contrasting the features and fine print of various products so you don’t have to.

First, we researched to find over 20 banks and credit unions that offered 1-year CDs. Then, we reviewed each institution using our CD rates methodology to find the most-well rounded banking options. For each account, we compared the minimum opening deposits, early withdrawal penalties, and interest rates. We also considered the overall banking experience at each bank by assessing customer support availability, mobile app ratings, and ethics.

1-year CD Frequently Asked Questions

BrioDirect 12 Month High-Yield CD

Why it stands out: BrioDirect could be a good choice if you’re specifically searching for CDs. It’s offering a promotional 1-year CD with an interest rate that’s significantly higher than the average CD. 

APY for 1-year CD: 5.25% APY

1-year CD early withdrawal penalty: 90 days of interest

What to look out for: BrioDirect currently isn’t offering savings, checking, or money market accounts. You’ll have to look elsewhere for these types of accounts.

BrioDirect Review

CFG Bank 1 Year CD

Why it stands out: CFG Bank has a high interest rate on its 1-year CD, and you’ll only need $500 upfront to open one.

APY for 1-year CD: 5.28% APY

1-year CD early withdrawal penalty: 90 days of interest

What to look out for: Limited term options. CFG Bank doesn’t have many CD terms to choose from — there are only 12-month, 13-month, 18-month, 36-month, or 60-month CDs.

CFG Bank Review

Limelight Bank 1 Year Online CD

Why it stands out: Limelight Bank, an online division of Community Capital Bank, pays a competitive interest rate on a 1-year CD. 

APY for 1-year CD: 5.25% APY

1-year CD early withdrawal penalty: 90 days of interest

What to look out for: Limelight Bank only offers CDs. If you plan on opening a savings or checking account at the same bank, you’ll have to choose another financial institution.

Keep in mind that Limelight Bank uses the same mobile app as CCBank. 

First Internet Bank of Indiana 1 Year CD

Why it stands out: First Internet Bank of Indiana pays high interest rates on several short-term CDs. First Internet Bank of Indiana also has a savings account, a money market account, and two types of checking accounts.

APY for 1-year CD: 5.22% APY

1-year CD early withdrawal penalty: 180 days of interest

What to look out for: First Internet Bank of Indiana compounds your interest monthly, not daily. Depending on how much money is in your CD, this may or may not make a significant difference.

First Internet Bank of Indiana Review

Forbright 1 Year Online CD

Why it stands out: Forbright Bank is an eco-friendly financial institution in Maryland that has nationwide online CDs. The 1-year CD offers a high interest rate. You also might like Forbright if you value banking with a financial institution that aligns with your values. Forbright Bank has received a Fossil Free Certification, which means that it will not lend to fossil fuel companies or projects.

APY for 1-year CD: 5.20% APY

1-year CD early withdrawal penalty: 3 months of interest

What to look out for: If you’d like to open a checking, savings, or money market account, you’ll have to open an account at a branch in Maryland. Forbright Bank also has limited online CD terms. You may find more variety at other online banks.

Bread Savings 1 Year High-Yield CD

Why it stands out: Bread Savings might be worthwhile if you’re searching for a 1-year CD. Interest is compounded daily, which could make a difference depending on how much you deposit into a CD.

APY for 1-year CD: 5.20% APY

1-year CD early withdrawal penalty: 180 days of interest

What to look out for: Generally, financial institutions require only $1,000 to open a CD. To open a CD at Bread Savings, you’ll need at least $1,500. 

The early withdrawal penalty for a 1-year CD is also a bit steep, compared to other financial institutions.

Bread Savings Review

Rising Bank 1 Year CD

Why it stands out: Rising Bank offers competitive interest rates on short-term CDs. Its 1-year, and 15-month terms, in particular, stand out for their high interest rates.

APY for 1-year CD: 5.15% APY

1-year CD early withdrawal penalty: 90 days of interest

What to look out for: Rising Bank only offer terms ranging from 6 months to 3 years. If you’re also interested in long-term CDs, you might prefer another financial institution. 

Other 1-year CDs We Considered

We looked at the following 1-year CDs as well. These CDs ultimately weren’t chosen among our top picks because they may have lower rates than our winners, higher minimum opening deposits, or more substantial early withdrawal penalties. You might find some of these options appealing though, depending on your preferences.

• Crescent Bank CD: Crescent Bank pays a lower interest rate on its CD than all our top picks. 
• Idabel National Bank 1 Year CD: Through SaveBetter, you may use one account to find, fund, and manage multiple high-yield savings and CDs from over 20 banks and credit unions. Idabel National Bank offers some of the most competitive CD rates on the platform, but our top picks currently pay higher rates for 1-year terms.
• America First Credit Union 1 Year Certificate: AFCU pays a high rate on its 1-year term, but the rates at our top picks are slightly higher.
• Barclays Online CD: Barclays CDs can be opened with $0, but our top picks offer higher interest rates.
• Vio Bank CD: Vio Bank’s 1-year term pays a lower interest rate than our top picks
• Air Force Federal Credit Union Certificate Account: Air Force Federal Credit Union pays high CD rates for a 1-year term but you’ll need a minimum of $100,000 to qualify for the highest interest rate.
• Pentagon Federal Credit Union Money Market Certificate: PenFed pays a good interest rate on a 1-year CD, but our top picks have even higher rates right now. 
• Alliant Certificate: Alliant offers competitive interest rates for short-term CDs. However, our top picks have even higher interest rates with lower minimum opening deposits. 
• Bask Bank CD: Bask Bank pays a solid rate on a 1-year CD, but our top picks have even higher rates right now. 
• American Express® CD: American Express lets you open a CD with $0, but our top picks offer more competitive interest rates right now.
• Quontic CD: Quontic Bank pays good CD rates, but our top picks have lower early withdrawal penalties or higher rates. 
• Marcus High-Yield CD: Marcus has high-yield CDs with solid interest rates, but our top picks have more competitive rates for a 1-year CD. 
• First National Bank of America CD: First National Bank of America has a variety of CD terms and pays good rates. However, the rates on its CDs don’t compete with any of the banks on our list. 
• Capital One 360 CD: Capital One 360 might be worth considering if you’d like to open a CD with a low minimum opening deposit. But, its CD rates aren’t as competitive as our top picks.
• Citi Fixed Rate CD: Citi Fixed Rate CDs have a low $500 minimum opening deposit. Still, our top picks pay higher interest rates right now. 
• Sallie Mae CD: You’ll need a minimum opening deposit of $2,500 to open a CD at Sallie Mae. Our top picks have lower minimum opening deposits.
• Bank5 Connect High-Yield CD: Bank5 Connect has a strong interest rate on a 6-month CDs, but its other CD terms aren’t as strong.
• Nationwide CD: Nationwide’s 1-year CDs and 18-month CDs are its most appealing options, but other online banks offer even higher rates right now.
• Ally High Yield CD: Ally CDs might be a good choice if you’d like to get a CD with a $0 minimum opening deposit or low early withdrawal penalties. But its CD rates are currently lower than any of the banks on our list.
• Discover CD: The initial opening deposit for a Discover CD is $2,500. Our top picks have lower minimum opening deposits.
• Citizens Online CD: You’ll need at least $5,000 to open an account, which is a bit steep compared to other online banks.
• Amerant CD: Amerant has solid interest rates, but our top picks offer more competitive rates right now. 
• Connexus Share Certificate: Connexus requires a minimum opening deposit of $5,000. Our top picks have much lower minimum opening deposits.
• NBKC CD: NBKC offers competitive interest rates on long-term CDs, but its short-term CDs aren’t as strong. 
• Live Oak Bank CD: Live Oak Bank offers a competitive interest rate, but you’ll need at least $2,500 to open an account.

Bank Trustworthiness and BBB Ratings

We’ve compared each banks Better Business Bureau score. The BBB grades businesses based on factors like responses to customer complaints, honesty in advertising, and transparency about business practices. Here is each company’s score:

CFG Bank, BrioDirect, and Bread Savings have the lowest BBB ratings on our list. 

CFG Bank currently doesn’t have a rating because its profile is being updated on the BBB website. Bread Savings’ parent company also has an NR “No Rating” because the BBB is evaluating a pattern of complaints before giving a rating.

The BBB gave BrioDirect’s parent company, Webster Bank, a B- rating because it received numerous customer complaints filed against the bank and hasn’t resolved the complaints.

A BBB rating isn’t necessarily the be-all and end-all. If you’d like to see if a company is a good fit, talk to current customers or read online customer reviews.

Bread Savings has been involved in a recent public controversy. 

According to a note on the BBB website about Comenity Capital Bank (Bread Savings’ partner bank), there has been a pattern of complaints and reviews received by the BBB between October 15, 2022, and November 14, 2022. The complaints claim that customers have experienced billing inaccuracies, customer service deficiencies, and inaccurate reporting to credit bureaus. The BBB has written to the company about these issues twice in the last two months. Comenity agreed to meet with the BBB on March 2, 2023, and the BBB will provide updates as needed.

Sophia Acevedo, CEPF

Banking Reporter

Evelyn He

Compliance Associate

Evelyn He is a compliance associate at Insider who supports the Personal Finance Insider team. Personal Finance Insider is Insider’s personal finance section that incorporates affiliate and commerce partnerships into the news, insights, and advice about money that Insider readers already know and love.
The compliance team’s mission is to provide readers with stories that are fact-checked and current, so they can make informed financial decisions. The team also works to minimize risk for partners by making sure language is clear, precise, and fully compliant with regulatory and partner marketing guidelines that align with the editorial team.
Before joining Insider, she served in various legal and compliance roles in different industries, including the legal and pharmaceutical industries.   
Evelyn obtained her M.S. degree in Marketing at Boston University in 2022. Prior to combining and consolidating her knowledge of law and business, she spent one year finishing 1L courses at Suffolk University Law School to further her legal knowledge. She has also completed MBA business law courses while working on her Bachelor of Business Administration in Management at the University of Massachusetts, Amherst. 
Outside of work, she enjoys spending time with her 14-year-old Shih Tzu named Money, and her 4-year-old Bichon named Tibber.

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• Around 79% of US workers are worried that adopting AI will result in pay cuts, a new survey found.
• Workers are concerned that AI-driven layoffs will happen in the next six months to two years. 
• However, 86% of workers are willing to take a cut in salary if AI can help them work less. 

American workers are concerned about the adoption of AI in the workplace, especially the prospect of wages declining across the country, a new survey found. 

The survey, carried out via survey platform Pollfish and commissioned by employment screening service Checkr, polled 3,000 employed American workers between April 27 and 28, 2023. An equal number of Boomers, Gen Xers, Millennials, and Gen Z were surveyed as part of the report. 

It found that 79% of all American workers were fearful or unsure about the possibility of AI driving pay cuts for their position with 82% of millennials feeling this way. Meanwhile, 76% of Gen Zers and a similar percentage of other generations echoed the feeling. 

Additionally, 78% of all workers were unsure about whether AI could lead to wage declines across the country.

74% of all workers felt the incorporation of AI in the workplace may result in them losing their jobs with the same amount believing AI layoffs are going to happen in the next six months to two years. 

Although there’s fear that AI could kill their jobs, many workers are excited that it could take some workload off their shoulders. 

Over half of all workers said they would take a pay cut if AI-enabled a four-day workweek. A further 86% said they’d take a pay cut to work less if AI could help them get all their work done. 

Millennials, Gen Xers, and Boomers are willing to take a pay cut of 10% whilst Gen Zers said they’d give up 15% of their pay to work less. 

Insider has contacted Checkr for comment but did not immediately hear back outside regular working hours. 

One study of 5,000 customer support agents at Fortune 500 companies in the Philippines found that generative AI had a positive effect on worker productivity. 

The lowest-skilled agents in the study who received AI assistance in responding to customer inquiries and other tasks saw a 35% increase in productivity. 

• Nationwide, the typical home has a monthly mortgage cost that’s about 25% more than rent, according to Redfin.
• However, buying is actually more affordable in Detroit, Philadelphia, Cleveland, and Houston. 
• California’s Bay Area has the biggest premium on owning a home. 

In the US, it’s about 25% more expensive to buy a home than rent it, but in four metro areas ownership is cheaper, according to Redfin.

An analysis of single-family homes and townhouses found that estimated monthly mortgage costs are lower than monthly rental costs in Detroit, Philadelphia, Cleveland, and Houston. 

In Detroit, the typical home is 24% less expensive to buy than rent — the largest percentage discount among the 50 most populous metros, Redfin said in a report Friday. The median mortgage payment for homebuyers there is $1,296, while the average estimated rent hovers at $1,697.

Philadelphia offers a 7% discount, and it’s followed by Cleveland (4% discount) and then Houston (1% discount).

Property values in these four locations have stagnated relative to the rest of the country, Taylor Marr, Redfin’s deputy chief economist, explained in the report. If Americans looking to buy a home can’t build equity, they have less incentive to pay a premium to own. 

Meanwhile, California’s Bay Area features the largest premium to homeownership in the US. It’s twice as expensive to own than buy in cities including San Jose, San Francisco, and Oakland. 

“Buying a home often makes more financial sense than renting if you can afford a down payment and monthly mortgage because you’re building equity,” Marr said. “When you own your home, your home pays you; when you rent, you and your home pay your landlord.”

Still, buying isn’t always the best option, as some people move often so renting makes more sense. Others simply don’t have enough money to make a down payment on a property, Marr noted, and that’s become increasingly common as mortgage rates climb and affordability drops.

The average rate on a 30-year fixed mortgage just topped 7% for the first time since March, Bankrate data showed Wednesday.

It’s worth noting, too, that while home values in Cleveland and Detroit haven’t climbed in the same way as pandemic boom-towns like Phoenix and Miami — where there are virtually zero homes that are cheaper to buy than rent — that means they also won’t see the same crashes, Redfin noted.

Redfin

“I wouldn’t encourage people to squeeze their budgets in order to buy a home when prices are falling and we’re teetering on a recession,” Marr said. “In the years leading up to the pandemic, it made sense for some homebuyers to break the rule that says not to spend more than 30% of your income on monthly housing costs, but these times are more risky, so it makes sense to be a little more conservative.”