June 5, 2017 in CDs

If the returns on the best savings accounts won’t do, look toward a CD.

Certificates of deposit are safe vehicles for investors. If you keep your funds locked up for an entire term, you can expect to end up with your initial deposit plus interest.

A 12-month CD won’t pay the highest rates in the market. But when your account comes due, you’ll be able to reinvest your funds in a CD with a more attractive yield.

The best 1-year CD rates pay more than four times the national average of 0.41 percent APY, according to Bankrate’s most recent national survey of banks and thrifts.

Today’s top nationally available 1-year CDs pay 1.76 percent APY. That’s not enough to retire on, but it’s a good vehicle to meet short-term financial obligations (like saving for a down payment on a mortgage) that can let your money grow near the rate of inflation without having to worry about missing out on better deals that arrive after you invest.

Finding the best 1-year CD rates

CD rates remain low by historical standards, but you can find significantly better deals than at the big national bank that handles your checking account if you’re willing to shop around. Researching rates at several local banks, as well as reputable online banks, will usually yield the best rate.


Here are the top nationally available 1-year CD rates. Compare these offers then calculate how much interest you would earn when your CD matures.

Best 1-year CD rates
Institution APY Minimum deposit
VirtualBank 1.76% $10,000
Banesco USA 1.75% $1,500
CDBank.com 1.75% $10,000
Limelight Bank 1.71% $1,000
KS StateBank 1.70% $500

Top account details

  • VirtualBank operated under Lydian Private Bank until it closed in 2011. Based in Miami, the internet bank is now a division of Sabadell United Bank, an FDIC-insured institution. Sabadell United Bank earned four out of five stars on Bankrate’s latest Safe & Sound Ratings, which measures the financial health of banks and credit unions throughout the United States.
  • Banesco USA is based in Coral Gables, Florida. It was founded in 2006 and has local branches as well as one in Puerto Rico. The bank earned three out of five stars from Safe & Sound.
  • CDBank.com is the online division of TBK Bank. It launched in May 2017 and is based in Dallas, Texas. TBK Bank earned four out of five stars from Safe & Sound.
  • Limelight Bank was founded in 2017 by Capital Community Bank. It’s based in Provo, Utah and offers a few short-term CDs. Capital Community Bank earned four out of five stars from Safe & Sound.
  • KS StateBank has six branches in Kansas and one in Phoenix. Based in Manhattan, Kansas, it’s an FDIC-insured institution founded in 1969. The bank earned five out of five stars from Safe & Sound.

Keep your goals in mind

A 1-year CD is only useful if you don’t plan to touch your savings for a full 12 months. Breaking the contract you made with a bank or credit union and dipping into your account before it matures could cost you quite a bit of interest.

Something that’s more liquid — like a money market account — could be a better place for your funds. You’ll be stuck with a lower interest rate, but you’ll have the flexibility to use your savings to cover a last-minute trip or an emergency expense.