The top 4-year CDs have something in common. They offer savers a higher yield than savings accounts and money market accounts. Combine that with a guaranteed rate of return and safety (when you choose a federally-insured account) and these investments may be worth your consideration.

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 1.02 percent APY, according to Bankrate’s most recent national survey of banks and thrifts.

Today’s top nationally available 4-year CDs pay 2.70 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.

Best 4-year CD rates for January 2020

  • Hiway Federal Credit Union: 2.70% APY; $25,000 minimum deposit
  • Credit Union of the Rockies: 2.60% APY; $1,000 deposit to earn APY
  • Advancial Federal Credit Union: 2.58% APY; $25,000 deposit to earn APY
  • MAC Federal Credit Union: 2.55% APY; $1,000 minimum deposit
  • Garden Savings Federal Credit Union: 2.53% APY; $500 minimum

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.

Best 4-year CD details

Hiway Federal Credit Union – 2.70% APY; $25,000 minimum deposit

Hiway Federal Credit Union offers today’s highest nationally available 4-year CD rate. A minimum of $500 is needed to open a share certificate, but the higher your deposit, the higher your interest rate. Even with a $500 deposit, however, you would still qualify for a competitive rate (2.48 percent APY).

In addition to its 4-year share certificate, the credit union offers various short- and mid-term certificates, including IRA certificates, a certificate builder and a 24-month step up account that allows members to adjust their rate once during their term. Note these perks and keep in mind that early withdrawal penalties apply for early withdrawals. For the 5-year share certificate, for example, the penalty for cashing out before the certificate matures is equal to 365 days of dividends.

Hiway was founded in 1931 to serve employees of the Minnesota Department of Transportation. The credit union, based in St. Paul, Minnesota, has since grown to 75,000 members. Membership is open to anyone who makes a one-time $10 donation to the Minnesota Recreation and Park Foundation. In the latest review of its financial health, it earned two out of five stars.

Credit Union of the Rockies – 2.60% APY; $1,000 deposit to earn APY

The Credit Union of the Rockies offers certificates across most standard terms. The minimum deposit to open an account is relatively low ($1,000) and the accounts can be easily opened online.

Founded in 1937, Credit Union of the Rockies is based in Golden, Colorado. Membership is open to anyone who joins the Consumers United Association for a $5 membership fee. In addition to its standard share certificates, the credit union offers promotional CDs and baby jumbo certificates requiring a minimum deposit of $50,000.

Advancial Federal Credit Union – 2.58% APY; $25,000 deposit to earn APY

Advancial Federal Credit Union consistently offers some of the highest yields available for credit union members interested in short-term share certificates. Terms range from three months to five years and members are rewarded with higher yields for larger deposits.

You’ll need at least $50,000 to earn the top yields at the credit union. But you’ll still earn a relatively impressive yield if you have at least $25,000 to deposit. In addition to regular share certificates, the credit union offers an add-on certificate that allows multiple deposits. The certificate can also potentially be used as collateral to secure a loan.

Advancial has been around since 1937 and is based in Dallas. Membership applications are available online and paper applications can be downloaded and printed. Membership is open to employees and individuals associated with specific groups and organizations in addition to locals who live, work or worship in certain parts of Louisiana. It’s also possible to qualify for membership by joining the Connex Professional Network and paying a $5 fee.

MAC Federal Credit Union – 2.55% APY, $1,000 minimum deposit

The credit union offers one of the top nationally available  4-year CD yields. A relatively low minimum deposit is required to open an account. Share certificates are available as IRAs. Money market and accounts for kids are also available.

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. Membership is open to local students and residents, as well as those who join the AUSA Polar Bear Chapter.

Garden Savings Federal Credit Union – 2.53% APY, $500 minimum deposit

There’s a reason why the 4-year CD at Garden Savings Federal Credit Union ranks as one of the best nationally available accounts: the yield is higher than what’s available at most banks, especially since the Federal Reserve cut interest rates several times in 2019.

The credit union was originally founded in 1968 to serve the employees of AT&T Bell Laboratories. The institution currently serves more than 25,000 members, including customers near their headquarters in Parsippany, New Jersey. Membership is open to employees of select companies, local residents and others who worship and live in the surrounding communities. For others, the easiest way to join is through the American Consumer Council.

Who is a 4-year CD good for?

A 4-year CD is good for someone who wants to earn a certain amount of 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 a good 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, then a 4-year CD is a way to earn an APY that is currently beating the inflation rate.

4-year CD yields offered by popular banks – January 2020

  • Citizens Access: 2.20% APY, $5,000 minimum deposit
  • Comenity Direct: 2.10% APY, $1,500 minimum deposit
  • Synchrony Bank: 2.09% APY; $2,000 minimum deposit
  • Barclays Bank: 2.00% APY, no minimum deposit
  • PurePoint Financial: 2.00% APY, $10,000 minimum deposit

Citizens Access – 2.20% APY, $5,000 minimum deposit

Citizens Access launched in July 2018. It made its debut with a savings account and CDs. And then in November 2019, it added an 11-month liquid CD and stopped offering the six and 18-month CDs.

The bank offers a competitive yield on its CDs and savings account. All of its products require a $5,000 minimum deposit. Interest payment options are flexible, meaning customers can have interest credited to the principal balance of the CD or transferred to another account, without penalty, before the CD matures.

Citizens Access is a direct bank offering savings products and the new online division of Citizens Bank.

Comenity Direct – 2.10% APY, $1,500 minimum deposit

Among popular online banks, Comenity Direct offers one of the most competitive yields. And savers don’t have to pony up too much cash to qualify. The minimum deposit for its savings account is even lower ($100). CD terms range from one year to five years. As in most cases, at Comenity Direct, the longer-term CDs pay higher APYs.

Comenity Direct launched in April 2019. It’s an online-only bank that offers high-yield savings products and CDs. It’s a division of Comenity Capital Bank, which is part of a brand that has been around for 30 years.

Synchrony Bank – 2.09% APY, $2,000 minimum deposit

Synchrony Bank offers competitive yields across 12 terms. All standard CD terms typically offered by banks and credit unions are available. The bank also offers a savings account and a money market account. The savings account has a competitive APY and has no minimum balance requirement.

The bank is an online-only financial institution that’s part of a company that also issues credit cards. The bank’s relatively new mobile app makes it possible to manage your accounts from anywhere.

Barclays Bank – 2.00% APY, no minimum deposit

Barclays Bank doesn’t have minimum balance requirements to open its CDs and savings account. That means it’s an option for savers across all income levels. The bank offers nine CD terms. It has competitive yields, but it doesn’t tend to offer the highest available APY. Barclays also offers a savings account, which has a competitive APY.

The bank is headquartered in the U.K. and has a global presence. In the U.S., its products are limited, but the bank overall rates well for its lack of monthly fees and deposit products.

PurePoint Financial – 2.00% APY, $10,000 minimum deposit

PurePoint Financial is a division of MUFG Union Bank. It offers nine regular CD terms and three terms for its no-penalty CDs. It also offers an online savings account with a competitive yield.

All of PurePoint Financial’s products have one thing in common: they require a $10,000 minimum deposit to open. So these accounts aren’t a good fit if you’re not ready to deposit that much.

Pros and cons of a 4-year CD

Pros of a 4-year CD

  • Earn a fixed APY.
  • If your account is insured by the FDIC or the NCUA – and you’re within the previously mentioned insurance guidelines – 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.

Cons of a 4-year CD

  • A 4-year CD may be 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 lowered interest rates three times in 2019. The future is uncertain and investing in a long-term CD may not seem like the best idea for most people.

A typical CD comes with an early withdrawal penalty of six months’ interest. If your investment strategy calls for putting your money into a 4-year CD, consider looking for a deal that isn’t too expensive to exit, especially if you may ditch your account 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 for the best 4-year CD rates

Institution APY Minimum deposit
Hiway Federal Credit Union 2.70% $25,000
Credit Union of the Rockies 2.60% $1,000
Advancial Federal Credit Union 2.58% $25,000
MAC Federal Credit Union 2.55% $1,000
Garden Savings Federal Credit Union 2.53% $500