The top 4-year CDs have something in common. They offer:

The Best 4-year CD Rates for August 2019

  1. MAC Federal Credit Union: 3.10% APY; $1,000 minimum deposit to open
  2. GTE Financial: 2.94% APY; $500 minimum deposit to open
  3. Georgia Banking Company: 2.90% APY; $500 minimum deposit to open
  4. Hanscom Federal Credit Union: 2.85% APY; $1,000 minimum deposit to open
  5. State Department Federal Credit Union: 2.83% APY; $500 minimum deposit to open

These are the top nationally available 4-year CD rates. Evaluate the offers, then calculate how much interest you would earn when your CD matures.

Finding the best 4-year CD rates will require some research. Comparing deals offered by online financial institutions is a good place to start. The best 4-year CDs pay more than 2.5 times the national average of 1.15 percent APY, according to Bankrate’s most recent national survey of banks and thrifts.

Today’s top nationally available 4-year CDs pay 3.10 percent APY. This may be a good place to invest for long-term financial obligations, like starting a business.

As you compare rates, pay attention to details. An account that doesn’t require you to fork over too much money upfront is ideal. Consider finding offers that don’t force you to jump through extra hoops — such as opening a new checking account — before you can purchase a CD.

Who is a 4-year CD for?

A 4-year CD is good for someone who wants to earn a fixed APY on their money. This is a product to consider if this is long-term money that you don’t want exposed to volatility. Money invested in the stock market would be an example of funds that are subject to volatility and uncertainty – and a possible risk of principal.

So, a 4-year CD can be an option if you value safety and don’t want surprises – since you’ll earn a fixed APY. Your CD is protected if it’s in a 4-year CD at an FDIC-insured bank or in a 4-year CD at an NCUA credit union. FDIC banks and NCUA credit unions are both backed by the full faith and credit of the U.S. government. But there are limits to the insurance. Each depositor at an FDIC bank is insured to at least $250,000 per insured bank, according to the FDIC. The standard share insurance amount at an NCUA credit union is $250,000 per share owner, per insured credit union, for each ownership category at an NCUA credit union, according to the NCUA.

Why get a 4-year CD?

Get a 4-year CD if you have money that you’re looking to grow for more than four years. Generally, if you withdraw your money from the CD before the CD matures in four years, you’ll incur an early withdrawal penalty. If applicable, this will take away from your interest earnings.

You should get a 4-year CD if you want an APY that’s potentially higher than savings accounts and money market accounts. If you feel as if APYs will be stagnant or decreasing in the near future, than a 4-year CD is a way to earn an APY that is currently beating the inflation rate.

Best 4-year CD details

MAC Federal Credit Union

The credit union was originally founded as Tanana Valley Federal Credit Union and chartered in 1952. MAC Federal Credit Union is based in Fairbanks, Alaska. In the latest review of its financial health, it earned five out of five stars.

GTE Financial

GTE Financial was founded in 1935 and is based in Tampa, Florida. Anyone can join by funding a primary savings account, from which $5 will be automatically transferred to a Member Owner Share, signifying membership in the credit union. This is refundable when the GTE account is closed. GTE earned three out of five stars in Bankrate’s latest review of its financial health.

Georgia Banking Company

Georgia Banking Company is based in Atlanta. In addition to banking products, it offers loans, wealth management services and insurance products and services. In Bankrate’s latest review of its financial health, it earned three out of five stars.

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. The credit union earned five out of five stars in Bankrate’s latest review of its financial health.

State Department Federal Credit Union

Based in Alexandria, Virginia, State Department Federal Credit Union was founded in 1935 and was originally named U.S. Department of State Employees Federal Credit Union. Today, it serves more than 84,000 members worldwide. The credit union earned four out of five stars in Bankrate’s latest review of its financial health.

Pros and cons of a 4-year CD

Pros of a 4-year CD

  • Earn a fixed APY on your money.
  • If your CD is in an account at an FDIC bank or in a CD at an NCUA credit union – and within previously mentioned insurance guidelines – then your money will be backed by the full faith and credit of the U.S. government.
  • You’d lock in an APY that’s ahead of the current inflation rate.
  • If APYs end up decreasing, you’d be locked in for the next few years
  • A 4-year CD could help you diversify some of your savings/investments – if the rest is exposed to market volatility or has a possible loss of principal.

Cons of a 4-year CD

  • A 4-year CD may be a little long term for a CD at this point – especially if APYs start increasing dramatically.
  • If you need to make a withdrawal, generally, you’ll incur a penalty for that early withdrawal.
  • A 4-year CD may not be aggressive enough for you – depending on your time horizon and risk tolerance.

Factor in flexibility

The Federal Reserve just cut short-term interest rates for the first time in a decade. Long-term CDs pay the highest yields, but investing in one may not seem like the best idea. There’s no telling when rates might start to creep up again.

A typical CD comes with an early withdrawal penalty of six months’ interest. Looking for a deal that isn’t too expensive to exit may be worth it, especially if you may ditch your 4-year CD before it matures. Another option is to look for institutions giving savers a one-time rate increase over the course of their terms.

To recap, see below the best 4-year CD rates

Institution APY Minimum deposit
Mac Federal Credit Union 3.10% $1,000
GTE Financial 2.94% $500
Georgia Banking Company 2.90% $500
Hanscom Federal Credit Union 2.85% $1,000
State Department Federal Credit Union 2.83% $500