How can you use a 3-month CD in a CD ladder?

With a CD ladder, you’ll open several short- and long-term CDs with staggered maturity dates. The long-term CDs should allow you to take advantage of higher CD interest rates, while the shorter-term CDs let you either access the money sooner or reinvest into a new CD if you can find higher interest rates.A three-month CD may fit into your ladder as the shortest rung. Once it matures, you can either use the funds or reinvest into a longer-term CD with a higher interest rate.

Can you lose money with a 3-month CD?

You won’t lose money with a three-month CD with a fixed rate if you keep the funds in the account for the duration of the term and if you’re within the limits and guidelines of the Federal Deposit Insurance Corp. (FDIC) or, for share certificates, the National Credit Union Administration (NCUA). If you choose to withdraw the funds before the term ends, however, you’ll likely be hit with an early withdrawal penalty.

Best 3-month CD rates - December 2023

Written by

Karen Bennett

Edited by

Brian Beers

Reviewed by

Robert R. Johnson

Best available rates across different account types for Saturday, December 02, 2023

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What To Know First

A three-month certificate of deposit (CD) allows you to earn a fixed rate on your money for the short term. When considering a three-month CD, it can pay to compare the rate with those offered from high-yield savings accounts.

Only commit money to a three-month CD that you won’t need before the term ends, or else an early withdrawal penalty could eat up your interest earnings.

Bankrate’s picks for the top 3-month CD rates

Boeing Employees' Credit Union —5.60% APY, $500 minimum deposit
Popular Direct —5.10% APY, $10,000 minimum deposit
America First Credit Union —4.50% APY, $500 minimum deposit
First Internet Bank of Indiana —4.18% APY, $1,000 minimum deposit
EverBank (formerly TIAA Bank) —4.00% APY, $1,000 minimum deposit
Bank of America —4.00% APY, $1,000 minimum deposit
SchoolsFirst Federal Credit Union —3.95% APY, $500 minimum deposit
Ally Bank —3.00% APY, no minimum deposit
Golden 1 Credit Union —3.00% APY, $500 minimum deposit
Security Service Federal Credit Union —2.40% APY, $500 minimum deposit

Note: Annual percentage yields (APYs) shown are as of Nov. 3, 2023. Bankrate’s editorial team updates this information regularly, typically biweekly. APYs may have changed since the last update and may vary by region for some products.

Bankrate’s picks for the top 3-month CD rates

Boeing Employees' Credit Union

3.8

Overview

Boeing Employees’ Credit Union (BECU) is one of the nation’s largest credit unions, with nearly 1.1 million members. Membership is open to Boeing employees as well as residents, employees and business owners in Washington and parts of Idaho and Oregon.

Among the credit union’s offerings are savings, checking and money market accounts, as well as CDs that range from three months to five years. Specialty CDs offered include a bump-up CD and another that allows you to add funds during the term.

5.60% APY

$500 minimum deposit

Popular Direct

4.0

Overview

Popular Direct CDs are for established savers, since the CDs have a $10,000 minimum deposit requirement. The CDs have eight fixed terms, from three months to five years. Popular Direct’s High-Rise savings account offers a competitive yield and requires a $5,000 minimum deposit.

All Popular Direct deposit accounts are opened through Popular Bank.

Read Bankrate's Expert Popular Direct Review

5.10% APY

$10,000 minimum deposit

America First Credit Union

4.2

Overview

America First Credit Union was founded in 1939 in Salt Lake City. It has CDs with terms ranging from three months to five years. The minimum opening deposit for CDs is $500.

It also offers a variety of checking and savings accounts.

Read Bankrate's Expert America First Credit Union Review

4.50% APY

$500 minimum deposit

First Internet Bank of Indiana

4.6

Overview

First Internet Bank of Indiana was the first FDIC-insured financial institution to operate entirely online, according to the bank’s website. It opened in February 1999 and serves all 50 states.

First Internet Bank offers eight terms of CDs, a money market savings account with a competitive yield, a savings account and two checking accounts.

Read Bankrate's Expert First Internet Bank of Indiana Review

4.18% APY

$1,000 minimum deposit

EverBank (formerly TIAA Bank)

4.6

Overview

TIAA Bank is a division of TIAA FSB and has 10 branches, all in Florida.

TIAA offers CD terms ranging from three months to five years. It also offers a bump-rate CD, which allows a one-time rate bump should rates go higher. TIAA Bank offers a service for customers with deposits that exceed the FDIC insurance limit of $250,000. Funds are spread around to different federally insured banks to expand insurance coverage.

Read Bankrate's Expert EverBank (formerly TIAA Bank) Review

4.00% APY

$1,000 minimum deposit

Bank of America

4.2

Overview

Bank of America offers a wide range of CDs with terms from 28 days to 10 years, all of which require a $1,000 minimum deposit. While some of the CD terms currently earn competitive rates, most only earn minimal yields.

Other deposit accounts Bank of America offers include its Advantage Savings, which earns a minimal APY that’s below the national average. Checking account options include a noninterest-bearing account as well as one that earns interest. Bank of America doesn’t offer a money market account.

Read Bankrate's Expert Bank of America Review

4.00% APY

$1,000 minimum deposit

SchoolsFirst Federal Credit Union

4.0

Overview

SchoolsFirst Federal Credit Union was formed by school employees in 1934, during the Great Depression. Today, it has 50 branches.

SchoolsFirst Federal Credit Union has CD terms ranging from 30 days to five years. CDs at this credit union have four balance tiers: $500, $20,000, $50,000 and $100,000.

Read Bankrate's Expert SchoolsFirst Federal Credit Union Review

3.95% APY

$500 minimum deposit

Ally Bank

5.0

Overview

Ally Bank is an online-only bank formerly known as GMAC Bank. Ally offers seven terms of CDs, a no-penalty CD and two terms of a Raise Your Rate CD.

The Sandy, Utah-based bank also offers a savings account, an interest-bearing checking account and a money market account. Ally has 2.5 million customers with deposit accounts.

Read Bankrate's Expert Ally Bank Review

3.00% APY

$0 minimum deposit

Golden 1 Credit Union

3.5

Overview

Golden 1 Credit Union was founded in Sacramento, California, in 1933. It has more than 1 million members and over 70 branches in California. Membership to Golden 1 Credit Union is open to all Californians.

Non-Californians can join Golden 1 Credit Union if they are a registered domestic partner or family member of a current member or if they’re a member of one of the nearly 1,000 Select Employee Groups.

Read Bankrate's Expert Golden 1 Credit Union Review

3.00% APY

$500 minimum deposit

Security Service Federal Credit Union

4.5

Overview

Security Service Federal Credit Union was founded in 1956 to serve the needs of members of the U.S. Air Force Security Service Command and their families.

Based in San Antonio, it offers CD terms ranging from three months to seven years. It also offers checking and savings accounts, mortgages, auto loans and credit cards.

Read Bankrate's Expert Security Service Federal Credit Union Review

2.40% APY

$500 minimum deposit

In the news

The Federal Reserve chose not to hike rates on Sept. 20, after raising rates 11 times since March 2022. Competitive banks tend to pay higher yields on CDs and savings accounts when the Fed hikes rates and less when it cuts them.

It remains to be seen whether the Fed will choose to lift rates in its November and December meetings. Any further Fed rate hikes could potentially result in higher CD rates.

How to find the best 3-month CD rates

Comparison shopping is key when you’re looking for the best three-month CD rates. There are multiple types of CDs, including bump-up, step-up and liquid CDs. But the top three-month CD rates are usually found with traditional CDs.

Check out the best three-month CDs offered by banks and credit unions and weigh the pros and cons of going with a short-term certificate of deposit over an account that’s more liquid. Don’t forget to crunch the numbers and calculate how much interest you could earn by the end of your term.

Annual percentage yields (APYs) on CDs can vary greatly among banks, so it pays to shop around on a site such as Bankrate for a CD with the highest yield. Often, online-only banks and some credit unions pay considerably higher rates than large brick-and-mortar banks.

A benefit of a three-month CD is it only ties up your money for a relatively short period of time, yet a drawback is you’ll often find higher rates from longer-term CDs. For instance, it’s easy to find one-year CDs that pay better yields than many three-month CDs.

Other factors to consider when choosing a three-month CD include minimum deposit requirements as well as what the penalty is for early withdrawals.

When should you get a 3-month CD?

Whether a three-month CD is right for you depends on your own financial situation and goals. Due to its short term, a three-month CD could be a good investment for those who want the money freed up soon for planned purchases or to invest elsewhere.

When looking at three-month CDs, be sure to compare their rates with those offered from top high-yield savings accounts. You may be able to find a savings account that earns a higher yield, and this way you won’t need to lock in your funds for any amount of time.

Alternatives to 3-month CDs

Savings accounts: You may be able to score a higher APY from a savings account than from a three-month CD, and an added benefit of a savings account is it doesn’t tie up your money for any period of time.
Money market accounts: Like savings accounts, money market accounts are liquid accounts, meaning you have access to your money at any time without an early withdrawal penalty. An added benefit of money market accounts is they sometimes come with a debit card and check-writing privileges, unlike CDs or standard savings accounts (although their minimum deposit requirements may be higher than those of other deposit accounts).
Longer-term CDs: Longer-term CDs, such as 5-year CDs, sometimes earn higher APYs than shorter-term CDs. For instance, it’s not difficult to find a one-year CD that pays a better yield than many three-month CDs.

3-month CD FAQs

With a CD ladder, you’ll open several short- and long-term CDs with staggered maturity dates. The long-term CDs should allow you to take advantage of higher CD interest rates, while the shorter-term CDs let you either access the money sooner or reinvest into a new CD if you can find higher interest rates.

A three-month CD may fit into your ladder as the shortest rung. Once it matures, you can either use the funds or reinvest into a longer-term CD with a higher interest rate.
You won’t lose money with a three-month CD with a fixed rate if you keep the funds in the account for the duration of the term and if you’re within the limits and guidelines of the Federal Deposit Insurance Corp. (FDIC) or, for share certificates, the National Credit Union Administration (NCUA).

If you choose to withdraw the funds before the term ends, however, you’ll likely be hit with an early withdrawal penalty.

Research methodology

Bankrate has been around since 1976. It’s a leading publisher of rates and personal finance articles. It’s also often cited by some of the most respected and well-known publications and websites. The Bankrate promise is that we strive to help our readers make smarter financial decisions, adhering to strict principles of editorial integrity and transparency.

Bankrate’s editorial team is made up of five banking experts. These experts have researched many banks and at least twice a month go to bank websites to make sure readers stay up to date on the latest rates and bank products.

We select banks that have high APYs and that are popular and broadly available, and we include some of the largest banks.

Alliant Credit Union, Ally Bank, Amerant Bank, America First Credit Union, American Express National Bank, Axos Bank, Bank5 Connect, Barclays, Bask Bank, BECU (Boeing Employees Credit Union), Bethpage Federal Credit Union, BMO Harris Bank, Bread Savings (formerly Comenity Direct), BrioDirect, Capital One Bank, Chase Bank, CIBC USA, CIT Bank, Citibank, Citizens, Citizens Bank (Rhode Island), Credit One Bank, Comerica Bank, Customers Bank, Delta Community Credit Union, Discover Bank, Emigrant Direct, Fifth Third Bank, First Citizens Bank, First Internet Bank, First Technology Federal Credit Union, FNBO Direct, Golden 1 Credit Union, Huntington National Bank, Investors Bank, KeyBank, Limelight Bank, Live Oak Bank, M&T Bank, Marcus by Goldman Sachs, Morgan Stanley Private Bank, MySavingsDirect, Navy Federal Credit Union, NBKC Bank, PenFed Credit Union, PNC Bank, Popular Direct, Quontic Bank, Randolph-Brooks Federal Credit Union, Regions Bank, Salem Five Direct, Sallie Mae Bank, Santander Bank, SchoolsFirst Federal Credit Union, Security Service Federal Credit Union, State Employees' Credit Union, Suncoast Credit Union, Synchrony Bank, TD Bank, TIAA Bank, Truist Bank, U.S. Bank, UFB Direct, USAA Bank, Vio Bank, VyStar Credit Union, Wells Fargo and Zions Bank.

Best 3-month CD rates - December 2023

What To Know First

Bankrate’s picks for the top 3-month CD rates

On This Page

Certificate of Deposit (CD)

Checking account

Savings / Money Market Accounts (MMA)