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Karen Bennett
Written by
Marc Wojno
Edited by
Allyson Johnson
Reviewed by
Best available rates across different account types for Sunday, May 19, 2024
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What To Know First
Acertificate of depositis a financial product that allows you to stash away some cash and earn a fixed rate of interest for a set period of time. In exchange for handing over your money for a specified and longer term, you usually earn a higher interest rate. For example, a five-year CD can earn a higher (and guaranteed) rate than a typical savings account while still offering safety.
The average 5-year CD yield is 1.41 percent APY, according to Bankrate’s national index survey of banks and thrifts on May. 19, 2024, but Bankrate’s team shopped around to find some of the best CD rates available nationwide.
Compare these offers, thencalculatehow much interest you would earn when your CD matures.
Bankrate’s picks for the top 5-year CD rates
- First Internet Bank of Indiana — 4.50% APY, $1,000 minimum deposit
- SchoolsFirst Federal Credit Union — 4.35% APY, $500 minimum deposit
- Quontic Bank — 4.30% APY, $500 minimum deposit
- Popular Direct — 4.30% APY, $10,000 minimum deposit
- America First Credit Union — 4.20% APY, $500 minimum deposit
- Synchrony Bank — 4.00% APY, no minimum deposit
- Alliant Credit Union — 4.00% APY, $1,000 minimum deposit
- TAB Bank — 4.00% APY, $1,000 minimum deposit
- LendingClub Bank — 4.00% APY, $2,500 minimum deposit
- Sallie Mae Bank — 4.00% APY, $2,500 minimum deposit
Note: Annual percentage yields (APYs) shown were updated between May 12, 2024 and May 18, 2024. Bankrate's editorial team validates this information regularly, typically biweekly. APYs may have changed since they were last updated and may vary by region for some products. Bankrate includes only FDIC banks or NCUA credit unions in its listings.
On This Page
- Bankrate's picks for the top 5-year CD rates
- How to find the best 5-year CD rates
- When should you get a 5-year CD?
- What to consider when choosing a CD
- Pros and cons of 5-year CDs
- What an inverted yield curve means for CDs
- 5-year CD FAQs
- Research methodology
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Our banking reporters and editors focus on the points consumers care about most — the best banks, latest rates, different types of accounts, money-saving tips and more — so you can feel confident as you’re managing your money.
Show me:
The following accounts can be found at most banks and credit unions. They’re federally insured for up to $250,000 and offer a safe place to put your money while earning interest.
Certificate of Deposit (CD)
CDs are best for individuals looking for a guaranteed rate of return that’s typically higher than a savings account. In exchange for a higher rate, funds are tied up for a set period of time and early withdrawal penalties may apply.
Checking account
Checking accounts are best for individuals who want to keep their money safe while still having easy, day-to-day access to their funds. ATM and other transactional fees may apply.
Savings / Money Market Accounts (MMA)
Savings and MMAs are good options for individuals looking to save for shorter-term goals. They’re a safe way to separate your savings from everyday cash, but may require larger minimum balances and have transfer limitations.
Current savings trends
Bankrate Partner average
4.90% APY
National average
0.59% APY
The "Bankrate Partner average" is calculated from the average of the top savings account offers from the institutions we track, included on this page as of 5/19/2024. "National average" is determined by Bankrate's comprehensive national survey of savings accounts and CDs.
On This Page
On This Page
- Bankrate's picks for the top 5-year CD rates
- How to find the best 5-year CD rates
- When should you get a 5-year CD?
- What to consider when choosing a CD
- Pros and cons of 5-year CDs
- What an inverted yield curve means for CDs
- 5-year CD FAQs
- Research methodology
Bankrate's picks for the top 5-year CD rates
Note: Annual percentage yields (APYs) shown were updated between May 12, 2024 and May 18, 2024. Bankrate's editorial team validates this information regularly, typically biweekly. APYs may have changed since they were last updated and may vary by region for some products. Bankrate includes only FDIC banks or NCUA credit unions in its listings.
First Internet Bank of Indiana
Rating: 4.6 stars out of 5
4.6
Overview
First Internet Bank of Indiana is an FDIC-insured financial institution that operates online and has no branches. It opened in 1999 and offers products in 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
4.50% APY
$1,000 minimum deposit
SchoolsFirst Federal Credit Union
Rating: 4.5 stars out of 5
4.5
Overview
SchoolsFirst Federal Credit Union was formed during the Great Depression in 1934.
SchoolsFirst Federal Credit Union (SchoolsFirst FCU) has CD terms from as short as 30 days to as long as five years. The more money you put in your CD, the higher the APY. CDs at this credit union have four balance tiers: $500, $20,000, $50,000 or $100,000.
Read Bankrate's Expert SchoolsFirst Federal Credit Union Review
4.35% APY
$500 minimum deposit
Quontic Bank
Rating: 3.8 stars out of 5
3.8
Overview
Quontic Bank is an online bank that offers CDs as well as savings, money market and checking accounts.
A $500 minimum deposit is required to open a Quontic Bank CD and five terms are offered, ranging from six months to five years.
Read Bankrate's Expert Quontic Bank Review
4.30% APY
$500 minimum deposit
Popular Direct
Rating: 4 stars out of 5
4.0
Overview
Popular Direct is an online bank and a subsidiary of Popular Inc., a more than 120-year-old financial services company. Popular Direct was previously known as Banco Popular North America.
Popular Direct offers CDs in eight terms ranging from three months to five years. With a $10,000 minimum deposit to open, these CDs are geared toward serious savers. Interest compounds daily. Popular Direct doesn’t offer specialty CDs, such as bump-up or no-penalty CDs. It does offer a savings account with a competitive rate.
Read Bankrate's Expert Popular Direct Review
4.30% APY
$10,000 minimum deposit
America First Credit Union
Rating: 5 stars out of 5
5.0
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
4.20% APY
$500 minimum deposit
Synchrony Bank
Rating: 4.9 stars out of 5
4.9
Overview
Synchrony Bank offers competitive yields across 14 CD terms. Synchrony promises that CDs funded within 15 days of opening will pay a higher yield if rates increase during that period.
The bank also offers a money market account and a savings account. Both offer a competitive APY and have no minimum balance requirement.
Read Bankrate's Expert Synchrony Bank Review
4.00% APY
$0 minimum deposit
Alliant Credit Union
Rating: 4.7 stars out of 5
4.7
Overview
Alliant Credit Union was founded in 1935 as the United Airlines Employees’ Credit Union. It is one of the largest credit unions in Illinois and has 600,000 members nationwide. Alliant is an online credit union and doesn’t have branches.
Alliant offers six terms of CDs with competitive APYs and a reasonable minimum deposit requirement. It also offers IRA CDs, a high-yield savings account and a high-yield checking account.
Read Bankrate's Expert Alliant Credit Union Review
4.00% APY
$1,000 minimum deposit
TAB Bank
Rating: 4.6 stars out of 5
4.6
Overview
TAB Bank was established in 1998 in Ogden, Utah, as a banking service inside truck stops. TAB (Transportation Alliance Bank) serves businesses and individual customers.
It offers several checking accounts, a couple of savings account options, a money market account and CDs in eight terms, from six months to five years.
Read Bankrate's Expert TAB Bank Review
4.00% APY
$1,000 minimum deposit
LendingClub Bank
Rating: 4.3 stars out of 5
4.3
Overview
LendingClub is an online bank that offers six terms of CDs ranging from six months to five years. A $2,500 minimum deposit is required.
In addition to CDs, LendingClub offers a high-yield savings account and a rewards checking account.
Read Bankrate's Expert LendingClub Bank Review
4.00% APY
$2,500 minimum deposit
Sallie Mae Bank
Rating: 4.4 stars out of 5
4.4
Overview
Sallie Mae Bank offers 11 terms of CDs, savings accounts, a money market account, credit cards and private student loans. Sallie Mae Bank CD terms range from six months to five years.
Sallie Mae Bank offers a competitive yield on all of its deposit products.
Read Bankrate's Expert Sallie Mae Bank Review
4.00% APY
$2,500 minimum deposit
In the news
After 11 consecutive rate hikes, the Federal Reserve didn’t raise rates for the third time in a row during its December 2023 meeting. 94 percent of economists polled by Bankrate believe the Fed may start cutting rates in 2024.
With uncertainties about further rate increases and the possibility of rate cuts in the coming year, it might be an opportune time to think about a long-term investment strategy. Some shorter-term CDs are currently offering higher rates, but a five-year CD can guarantee a high rate for a longer amount of time, and it may be worth considering as part of a CD ladder.
How to find the best 5-year CD rates
Savers looking for the best CD rates probably want to venture online. Even if a bank is relatively small or not well known, as long as it’s a member of the Federal Deposit Insurance Corporation (FDIC), you can rest easy knowing each depositor (that’s you) is protected up to at least $250,000 per insured bank. At a National Credit Union Administration (NCUA) institution, the standard insurance amount is up to $250,000 per share owner (depositor), per insured credit union, for each ownership category (account type).
One thing to look for, though: ease of use. Banks that make it difficult or time-consuming to deposit and withdraw funds may waste so much of your time that the benefit of a few extra basis points of interest on your savings is lost. (A basis point is 0.01 percent, so 1 percent has 100 basis points.)
When should you get a 5-year CD?
For those with a longer financial horizon and no need to access funds at a moment’s notice, a five-year CD can be a great choice. Because they earn a guaranteed rate for the whole term, five-year CDs are suitable for those who want to grow some of their savings over a half-decade, without the volatility associated with stocks or mutual funds.
CDs typically come with penalties for early withdrawal, so they’re best for those who are confident they won’t need to access their funds in the interim. If there’s a chance you’ll need the money for unexpected expenses or opportunities, it might be wise to explore more liquid, high-yielding savings accounts.
Alternatively, you could invest some money in a five-year CD and some in shorter-term CDs to build a CD ladder, ensuring that a portion of your savings will be accessible in the shorter term. A CD ladder staggers maturities and APYs, giving you the opportunity to earn a higher yield and still have access to some cash at set intervals.
What to consider when choosing a CD
Consider these things to help you choose the right CD:
- Early withdrawal penalties:Know what penalties may be incurred should you withdraw your money before the CD matures.
- Minimum required deposit:Many CDs require a minimum amount of money to open.
- APY:Annual percentage yield is the yearly interest earned if you keep your money in the CD for the full term. Compare APYs, instead of interest rates, to make an apples-to-apples comparison of CDs.
- Term:The length of time required to earn interest on your money. Generally, it’s a good idea to choose a CD with a shorter term than when you expect to need your money. For example, if you need access to the funds in about two years, an 18-month CD may be a good choice.
- Insurance:Make sure the CD is offered by an FDIC-insured bank or at an NCUA credit union.
Pros and cons of a 5-year CD
Pros
Limited liquidity — CDs don’t provide immediate access to your funds (unlike savings accounts), which could benefit those who may be tempted to otherwise spend their money. A CD can help keep your savings intact. Just be sure you won’t need the money before the CD matures for such things as emergencies or living expenses. It’s also important to understand the early withdrawal penalty that you’d incur if you needed to withdraw your funds sooner.
Safety — CDs from FDIC-insured banks and NCUSIF-backed credit unions are backed by the full faith and credit of the U.S. government up to $250,000.
High returns — Banks generally sometimes provide a higher APY with a five-year CD than you could find in a traditional savings account or in a CD with a shorter maturity.
Wide selection — You can choose from thousands of banks and credit unions to find a CD with the interest rate, maturity date (term) and minimum deposit amount that fits your needs.
Fixed, predictable returns — Once you put your money in a CD, you’re guaranteed a set return at a specified date, which can help you plan your financial goals.
Cons
Limited liquidity — The inability to instantly access funds is a drawback for those who may need their money before the CD’s term is up. You’ll typically pay a penalty for making early withdrawals. If you think it’s likely you’ll need this money in less than five years, consider a shorter-term CD or a savings account.
Inflation risk — The money in your CD may lose its purchasing power over time if inflation overtakes your interest gains.
Low relative returns — Other investment options may offer a higher rate of return. But these investments generally involve higher risk, including the chance of losing the principal. If you leave your money in the CD for the full term at an FDIC-insured bank and are within FDIC guidelines, your fixed-rate CD will earn that yield. The same is true for NCUSIF-backed credit unions.
Reinvestment risk — When you park your money in a five-year CD, it’s a long wait before you can tap those funds. If interest rates rise in the meantime, you could miss out on investing in a higher-rate CD.
What an inverted yield curve means for CDs
Traditionally, longer-term CD rates have been higher than shorter-term ones. This isn’t always the case, however. A yield-curve inversion is what happens when short-term rates are actually higher than long-term ones. Whether it applies to Treasurys or CDs, when yield curves invert, it’s an indicator that investors are expecting a downturn in the economy.
Currently, a yield-curve inversion is in place when it comes to average CD yields, which are as follows, based on Bankrate data for May. 19, 2024:
- 1-year CD average: 1.78 percent APY
- 2-year CD average: 1.5 percent APY
- 5-year CD average: 1.41 percent APY
When you’re in the market for a new CD and a yield curve inversion is in place, it’s important to look at all CD terms instead of assuming longer terms will earn more favorable APYs than shorter ones.
5-year CD FAQs
Research methodology
At Bankrate, we strive to help you make smarter financial decisions. We follow strict guidelines to ensure that our editorial content is unbiased and not influenced by advertisers. Our editorial team receives no direct compensation from advertisers and our content is thoroughly fact-checked to ensure accuracy.
Bankrate regularly surveys around 70 widely available financial institutions, made up of the biggest banks and credit unions, as well as a number of popular online banks.
To find the best CDs, our editorial team analyzes various factors, such as: annual percentage yield (APY), the minimum needed to earn that APY (or to open the CD) and whether or not it is broadly available. All of the accounts on this page are insured by the Federal Deposit Insurance Corp. or the National Credit Union Share Insurance Fund.
When selecting the best CD for you, consider the purpose of the money and when you’ll need access to these funds to help you avoid early withdrawal penalties.
