Savers have tons of places to park their cash. But choosing between a savings account and a certificate of deposit (CD) can be difficult.

A CD allows you to tuck away your money at a bank and earn fixed interest on that money until the CD matures. But because 3-month CDs are pretty short investments, banks tend to offer lower interest rates on these when compared to a high-yield savings account.

The top savings accounts pay around 2.4 percent APY. But the average yield is much lower (0.10 percent APY). If you’re hoping to earn a higher rate of return and you want the money you invest to be accessible, consider buying a 3-month CD.

The best 3-month CD rates available from banks and credit unions pay more than six times the national average of 0.34 percent APY, according to Bankrate’s most recent national survey of banks and thrifts.

The best 3-month CD rates for November 2019

  • VirtualBank: 1.51% APY; $10,000 minimum deposit
  • Spectrum Credit Union: 1.85% APY; $500 minimum deposit
  • Advancial Federal Credit Union: 1.70% APY; $25,000 minimum deposit to earn APY
  • Hanscom Federal Credit Union: 1.70% APY; $1,000 minimum deposit to open
  • MyBankingDirect: 1.65% APY; $2,500 minimum deposit

Today’s top nationally available 3-month CDs pay 1.9 percent APY (when the minimum deposit is $25,000 or less). They could be a great place to invest for short-term financial obligations, like establishing a rainy day fund you can eventually transfer to a savings account.

[COMPARE: Best CD rates]

Finding the best 3-month CD rates

Comparison shopping is a must when you’re looking for the best 3-month CD rates. There are multiple types of CDs, including bump-up CDs and liquid CDs. But the top 3-month CD rates are usually found in the form of a traditional CD.

Check out the best 3-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.

Best 3-month CD details

VirtualBank

An online division of Iberiabank, founded in 1887 and based in Lafayette, Louisiana. The bank’s financial services include retail, commercial, business and private banking as well as mortgages. Iberiabank earned four out of five stars in Bankrate’s latest review of its financial health.

The bank is based in Dallas but offers certain products nationwide, including several certificates of deposit that are available online.

Spectrum Credit Union

Founded in 1973, Spectrum Credit Union is based in Oakland, California. It is a division of Chevron Federal Credit Union. Membership is open to anyone who joins the Contra Costa County Historical Society or the Navy League of the United States.

Advancial Federal Credit Union

Founded in 1937, the credit union offers membership to any U.S. Citizen or permanent resident alien who joins Connex, a professional, online interactive network. The credit union earned four out of five stars in the latest review of its financial health.

Hanscom Federal Credit Union

Founded in 1953 with headquarters at Hanscom Air Force Base in Massachusetts. Anyone can become a member by joining the Nashua River Watershed Association for a $35 membership fee.

MyBankingDirect

The online bank is a division of the New York Community Bank. Accounts — including CDs, a checking account and a money market account — can be accessed 24/7. Services available include bill pay, mobile check deposit and the ability to transfer money through Popmoney if the recipient or sender has a different bank.

Best 3-month CD rates from big banks

Check out the 3-month CD rates offered by some of the country’s most popular big banks:

  • Ally Bank: 0.75% APY; $0 minimum deposit
  • Barclays Bank: 0.35% APY, $0 minimum deposit
  • Discover Bank: 0.35% APY, $2,500 minimum deposit

How to 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 3-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.

Alternatives to 3-month CDs

This type of CD isn’t right for everyone. Check out these alternatives to 3-month CDs:

Savings account or money market account

You may be able to score a higher interest rate with a money market account or a high-yield online savings account, while still maintaining access to your money.

“Money market and high-yield savings accounts typically offer higher interest rates than standard savings accounts, but normally require higher balances and may have restrictions or conditions to accessing one’s money,” says Robert Drury, executive director of the Association of Christian Financial Advisors.

Consider a CD with a longer term

CDs give savers a little bit of a yield boost over savings accounts in exchange for a long-term deposit. The longer savers agree to leave their money in the bank, the higher the yield.

Investing in a 1-year CD, for example, would require you to tie up your funds for a full 12 months. But it’s possible to earn a yield as high as 3 percent APY (for CDs available nationwide).

“Money market and high-yield savings accounts typically offer higher interest rates than standard savings accounts, but normally require higher balances and may have restrictions or conditions to accessing one’s money,” says Robert Drury, executive director of the Association of Christian Financial Advisors.

“CDs normally offer higher interest than these but unconditionally obligate one’s money for a specified term,” he says.

Learn more about other CD terms:

To recap, see the best 3-month CD rates below:

Institution APY Minimum deposit
VirtualBank 1.51% $10,000
Spectrum Credit Union 1.85% $500
Advancial Federal Credit Union 1.70% $25,000
Hanscom Federal Credit Union 1.70% $1,000
MyBankingDirect 1.65% $2,500