Overview
Find the best 1-year CD rates available. Compare short-term certificates of deposit with the highest APYs and lowest minimums. Finding the right option depends on your specific needs, spending habits, and financial goals. Below we break down the key factors to consider and the top choices available.
Best 1-Year CD Rates by Bank
| Bank | Why It Stands Out | Minimum Deposit | |
|---|---|---|---|
| CIT Bank | Often features especially strong promotional rates specifically on the 1-year term | $1,000 | Compare → |
| Marcus by Goldman Sachs | Consistently competitive rate with no minimum on many terms | $500 | Compare → |
| Synchrony Bank | No minimum deposit required, frequent rate promotions | $0 | Compare → |
| Ally Bank | 11-month "Raise Your Rate" CD is a close alternative if you want one rate increase option | $0 | All CD Terms → |
Why Choose a 1-Year CD Specifically
A 1-year CD sits in a sweet spot for many savers — long enough to typically earn a meaningfully higher rate than a savings account, but short enough that your money isn't locked away for years. It's a popular choice when you have a specific savings goal roughly a year out (a down payment, a wedding, a planned purchase) or when you want to keep your options open to reinvest at a potentially higher rate once it matures.
Compared to longer terms like 3-year or 5-year CDs, 1-year CDs also carry less "opportunity cost" risk — if rates rise significantly after you open the CD, you're only locked in for a year rather than being stuck at a below-market rate for much longer.
1-Year CD vs. Other Terms
- Vs. 6-month CDs: 1-year CDs typically offer a modestly higher rate in exchange for the longer commitment.
- Vs. 2-year and 5-year CDs: Longer-term CDs sometimes offer higher rates, but not always — in some rate environments, 1-year CDs are actually competitive with or better than longer terms, since banks price based on their own funding needs, not just term length.
- Vs. high-yield savings: A 1-year CD usually locks in a fixed rate, protecting you if rates fall during the year, while a savings account rate can drop at any time.
What Happens When Your CD Matures
Most banks give you a short grace period (often 7-10 days) after your 1-year CD matures to decide what to do — withdraw the funds, or let it automatically renew into a new CD at the current rate. If you don't act within the grace period, many banks will automatically roll your money into a new CD term, which may not offer the best available rate. Set a reminder for your maturity date so you can compare rates before it auto-renews.
Frequently Asked Questions
A 1-year CD is generally a solid choice if you want a fixed rate for a moderate commitment period. It's particularly appealing when you expect rates might fall, since it locks in today's rate; it's less ideal if you think rates will rise significantly, since you'd want a shorter term to reinvest sooner.
Early withdrawal penalties for 1-year CDs commonly equal about 3 months of interest, though this varies by bank. Some banks offer "no-penalty" CD options at a slightly lower rate if early access is a real possibility for you.
Not necessarily — several competitive online banks like Ally and Synchrony have no minimum deposit requirement, while others may require $500-$2,500 to open. Compare minimums alongside rates since a high minimum can rule out a bank even if its rate looks attractive.