Best 1-year CD Rates

Certificates of deposit are a safe way to store your savings and accumulate interest over time. Unlike traditional and high-yield savings accounts, however, you can’t touch the funds you invest in a CD for a certain period without incurring fees and penalties. CD term lengths vary from three or four months to several years. Good CDs have high-interest rates, robust customer service and perks, and low fees.

In this article

    The 7 best 1-Year CDs of 2021

    Provider1-Year APYMin. DepositEarly Withdrawal Penalty
    Ally Bank0.55%$060 days’ interest
    TIAA Bank0.50%$5,00091 days’ simple interest
    Synchrony0.50%$2,000180 days’ simple interest
    Marcus0.55%$500270 days’ simple interest
    Barclay’s0.25%$090 days’ simple interest
    Capital One0.20%$06 months’ simple interest
    CIT Bank0.30%$1,0003 months’ simple interest

    Rates accurate as of April 2021.

    The 7 best 1-Year CDs of 2021

    Ally Bank – Best customer satisfaction

    Ally’s online CD is simple, easy to access and comes with great customer service.

    1Y APY
    0.55%
    3Y APY
    0.65%
    Min. Deposit
    N/A
    SimpleScore
    4.2 / 5.0
    close
    SimpleScore Ally 4.2
    Savings APY 5
    1Y CD APY 5
    Customer Satisfaction 4
    Mobile App 3
    Products 4

    Ally Bank has made a name for itself with its robust offering of online-only banking services, including checking accounts, savings accounts and CDs. It has no minimum deposit requirement for CDs, but investors with higher deposits may be able to secure better rates. Its one year CD rate is 0.55%, which is competitive in the industry. Ally Bank also has an extremely high customer satisfaction score, and with no fees to open or maintain a certificate of deposit, it’s a great option when it comes to 1-year CDs.

    TIAA Bank – Best for yield pledge promise

    TIAA Bank has a guaranteed high-yield CD that matches prices with the top 5% of competitors.

    1Y APY
    0.50%
    3Y APY
    0.70%
    Min. Deposit
    $5,000
    SimpleScore
    3 / 5.0
    close
    SimpleScore TIAA Bank 3
    1Y APY 3
    3Y APY 4
    Customer Satisfaction N/A
    Support 4
    Minimum Deposit 1

    TIAA bank’s 1-year CD locks you into a guaranteed rate with a deposit of $5,000. TIAA assesses competitors weekly to ensure that it’s offering the best possible deal to their customers. The CD also offers a competitive rate of 0.50% APY, on par with many other CD providers, with term months ranging from three months to five years. There’s no monthly account fee, and the CD also comes with a 20-day maturity alert and automatic rollover. It does have a minimum deposit of $5,000, which may be out of reach for some investors.

    Synchrony – Best customer perks

    With consistently great rates, customer perks and a great mobile app, Synchrony checks all the boxes when it comes to a 1-year CD.

    1Y APY
    0.50%
    3Y APY
    0.65%
    Min. Deposit
    $2,000
    SimpleScore
    4 / 5.0
    close
    SimpleScore Synchrony 4
    1Y APY 5
    3Y APY 4
    Customer Satisfaction N/A
    Support 5
    Minimum Deposit 2

    Synchrony’s 1-year APY rate is 0.50%, which is competitive in the industry. It also offers a variety of perks, including 24/7 digital banking and dedicated phone lines for long-time customers. Its website features easy-to-use CD calculators and comprehensive educational resources that cover a variety of banking topics, so you can stay educated about how to make your money work for you. When it comes to CDs, Synchrony offers term lengths ranging from three to 60 months. It does have a minimum deposit requirement of $2,000, so it may not be a good fit for investors with savings lower than that amount.

    Marcus – Best rate guarantee

    Marcus has some of the best rates around when it comes to CDs, making it a competitive option for safely and sustainably growing your savings.

    1Y APY
    0.55%
    3Y APY
    0.55%
    Min. Deposit
    $500
    SimpleScore
    4 / 5.0
    close
    SimpleScore Marcus by Goldman Sachs 4
    1Y APY 5
    3Y APY 4
    Customer Satisfaction N/A
    Support 4
    Minimum Deposit 3

    Marcus is the online lending and banking branch of financial giant Goldman Sachs. Its 1-year CD rates are 0.55%, which is one of the highest yield CD rates available. Those looking to make the most of their CD investment will be hard-pressed to find rates as good as Marcus’. The CDs also come with a 10-day rate guarantee, meaning if its CD rates go up within 10 days of opening an account, your rate is increased to match it. Even if the rate is lowered, you stay locked in at your original APY.

    Capital One – Best mobile app

    Capital One offers a simple, user-friendly mobile app that makes managing your CD investments easier than ever.

    1Y APY
    0.20%
    3Y APY
    0.30%
    Min. Deposit
    $0
    SimpleScore
    3.6 / 5.0
    close
    SimpleScore Capital One 3.6
    1Y APY 2
    3Y APY 3
    Customer Satisfaction 3
    Support 5
    Minimum Deposit 5

    Capital One is one of the most customer-friendly lenders that offer CDs. It has a simple, intuitive mobile app that can help users to manage their money on the go. When it comes to CDs, there’s no minimum balance requirement and guaranteed returns. At 0.20%, Capital One’s rates are on par with others in the market, making it still competitive within the industry.

    CIT Bank – High APY

    CIT Bank has kept CD rates high for customers, despite the market trending lower, making it a top pick for 1-year CD rates.

    1Y APY
    0.30%
    3Y APY
    0.40%
    Min. Deposit
    $1,000
    SimpleScore
    2.8 / 5.0
    close
    SimpleScore CIT Bank 2.8
    1Y APY 2
    3Y APY 3
    Customer Satisfaction N/A
    Support 4
    Minimum Deposit 2

    With the high APY among banks and CD providers, CIT Bank scores high on the list of 1-year CD rates. Once you open an account, interest compounds daily, meaning your earning potential is maximized over the term of the deposit. The minimum deposit of $1,000 can be slightly daunting to new investors with little funds to start, but it’s much more accessible than other banks that require higher deposit minimums.

    What is a certificate of deposit?

    A certificate of deposit, or CD, is a way to safely and reliably invest your money over the short to medium term, as they have much less associated risk than investing in stocks. Like high-yield savings accounts, they offer much better interest rates than traditional savings accounts, with an average rate of around 1.50%. One downside when it comes to CDs is that you’ll usually face penalty fees if you remove any funds from the account before the term limit is up.

    How should I choose the right CD?

    Choosing the right CD is largely a matter of personal preference. In many cases, it’s a smart idea to shop around and compare rates before deciding on a particular CD. If you’re wondering, “What is the best 1-year CD rate?” you’ll be glad to know that our recommended lenders all have rates from 0.50% to 1.10%, which are some of the most competitive in the industry. If you particularly value other banking aspects, such as robust customer service or online banking, you may prefer a lender with strengths in those areas. In order to choose the best CD for you, you should:

    • Decide how long you want to invest.
    • Research different options and compare rates.
    • Look into costs and fees associated.
    • Keep in mind any additional perks.
    • Make sure to choose a CD with a minimum deposit that fits your budget.

    What are early withdrawal penalties?

    Almost all CDs charge penalty fees for early withdrawal. If you withdraw funds from your CD before the term length is up, you’ll usually be subject to these fees. Because of this, you should only invest money in CDs that you’re very comfortable “setting and forgetting.”

    For example, Ally Bank only imposes 60 days of interest penalty for early withdrawal, which means that the equivalent of 60 days of interest on your account will be subtracted from your total should you withdraw your funds before the end of the term. However, some banks do off no-penalty CDs, typically for a short and specific amount of time, that will allow customers to withdraw all funds early should they need to.

    Please Note: Information about Ally Invest has been collected independently by TheSimpleDollar.com. The issuer did not provide the details, nor is it responsible for their accuracy.

    Methodology

    SimpleScore

    The SimpleScore is a proprietary scoring metric we use to objectively compare products and services at The Simple Dollar.

    For every review, our editorial team:

    • Identifies five measurable aspects to compare across each brand
    • Determines the rating criteria for each aspect score
    • Averages the five aspect scores to produce a single SimpleScore

    Here’s a breakdown of the five aspect scores and their rating criteria for our review of the best CDs of 2020.

    Why do some brands have different SimpleScores on different pages?

    To ensure the SimpleScore is as helpful and accurate as possible, we developed unique criteria for every category we compare at The Simple Dollar. Since most brands offer a variety of financial solutions, their products and services will score differently depending on what we’re scoring on a given page.

    However, it’s possible for brands to have multiple SimpleScores. For instance, if we compare CDs offered by Discover, it scores a 3.75 out of 5 SimpleScore according to our metrics and rating system. But if we review Discover’s savings account according to our SimpleScore, it scores a 4.5 out of 5. We adjust our rating system to account for different products and industry standards.

    Questions about our methodology?

    Email Hayley Armstrong at hayley@thesimpledollar.com.

    12-month APY

    We awarded brands that offered higher APYs on 12-month certificates of deposit — the higher the APY, the higher the score.

    3-year APY

    We awarded brands that offered higher APYs on 3-year CDs — the higher the APY, the higher the score.

    Customer satisfaction

    We leveraged J.D. Power’s 2020 U.S. Retail Banking Satisfaction Study and 2020 U.S. Direct Banking Satisfaction Study to rate each brand for customer satisfaction. The higher the satisfaction score, the higher the SimpleScore.

    Minimum deposit

    Some providers require a minimum deposit to open a CD. We rated and rewarded brands that required low minimum deposits with higher scores.

    Customer support

    Providers with multiple channels of customer support were rewarded with higher scores in this aspect. We considered social media, mobile app support, in-branch support, phone and email as channels of support for customers.

    Margaret Wack

    Contributing Writer

    Margaret Wack writes about personal finance, health, wellness, arts and culture, among other topics.