August 2023’s top 3-month CD rates (up to 5.15%)
August 2023's top 3-month CD rates (up to 5.15%)
The Best 3-Month CD Rates: Making Smart Choices with Your Money
Investing your money in a certificate of deposit (CD) can be a smart financial move, offering a safe and predictable return. While the national average annual percentage yield (APY) on a 3-month CD is 1.11%, some of the best online banks are currently offering higher rates for this short-term investment. So, where should you look to get the best bang for your buck?
The Cream of the Crop
If you’re searching for a 3-month CD, look no further. We regularly check rates to find the best options for you. Let’s dive into our top recommendations:
- Oklahoma State Bank 3 Month CD, powered by Raisin: 5.23% APY
- Popular Direct 3 Month CD: 4.75% APY
- Newtek Bank 3 Month CD: 4.60% APY
- America First Credit Union 3 Month Certificate: 4.50% APY
- Alliant 3 Month Certificate: 4.50% APY
- First Internet Bank of Indiana 3 Month CD: 4.18% APY
- Bank of America 3 Month Fixed Term CD: 4.00% APY
- TIAA Bank Basic 3 Month CD: 4.00% APY
These rates are significantly higher than the national average, providing you with a great opportunity to earn more on your savings.
Behind the Scene: How We Choose the Best 3-Month CDs
At Personal Finance Insider, we want to equip smart people like you with the information needed to make the best financial decisions. We diligently researched over 20 banks and credit unions that offer 3-month CDs to find the most well-rounded options. Our criteria included minimum opening deposits, early withdrawal penalties, interest rates, customer support availability, mobile app ratings, and ethics.
What the Experts Say
To provide expert advice on choosing the best 3-month CD, we consulted four finance professionals:
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- Tania Brown, CFP at SaverLife
- Roger Ma, CFP with lifelaidout® and author of “Work Your Money, Not Your Life”
- Sophia Acevedo, CEPF, banking reporter, Personal Finance Insider
- Mykail James, MBA, CFEI, BoujieBudgets.com
Their insights shed light on important factors to consider when choosing your ideal banking partner. According to Tania Brown, FDIC insurance is a must to ensure the safety of your deposits. Sophia Acevedo suggests factoring in account costs and requirements when envisioning your banking experience. Roger Ma and Mykail James emphasize the importance of aligning the CD term with your financial goals and plans.
An In-Depth Look at Some of Our Top Picks
Now let’s dive into the specifics of some of our top recommendations:
Oklahoma State Bank 3 Month CD, powered by Raisin
As the highest-yielding 3-month CD on Raisin, the Oklahoma State Bank 3 Month CD stands out with an impressive 5.23% APY. Raisin offers a user-friendly platform to manage multiple high-yield savings accounts and CDs from over 20 banks and credit unions. Keep in mind that if you prefer a banking experience directly with a bank, you may consider other top picks.
Popular Direct 3 Month CD
Popular Direct offers a competitive rate on its 3-month CD, compounding interest daily and providing a solid 4.75% APY. While the bank charges high penalties on certain terms, the early withdrawal penalty for a 3-month CD is standard.
Newtek Bank 3 Month CD
Newtek Bank’s 3-month CD stands out for its competitive interest rate and its availability to customers across the United States. The bank also offers other banking options, such as business checking and savings accounts, as well as a personal high-yield savings account. However, availability for the personal high-yield savings account is limited, so you may need to sign up for a waitlist.
America First Credit Union 3 Month Certificate
With branches in Arizona, Idaho, Nevada, and Utah, America First Credit Union offers a variety of certificate terms with high interest rates. Its 3-month certificate provides a competitive 4.50% APY and an early withdrawal penalty of 60 days of interest. Keep in mind that credit unions require membership to open accounts, but joining is relatively easy if you meet the eligibility criteria.
Alliant 3 Month Certificate
For those comfortable with online banking, Alliant Credit Union offers a strong choice for CDs. Its 3-month and 6-month terms offer high interest rates, including a competitive 4.50% APY for the 3-month CD. Becoming a member of Alliant Credit Union is made easier by joining Foster Care to Success, as the $5 joining fee will be covered by the credit union.
First Internet Bank of Indiana 3 Month CD
If you prefer online banking and competitive interest rates, First Internet Bank of Indiana is worth considering. Alongside its 4.18% APY on the 3-month CD, the bank offers various CD terms and is featured in our best money market accounts guide. Note that interest is compounded monthly, not daily, which may or may not be a significant factor depending on your deposit amount.
Bank of America 3 Month Fixed Term CD
Bank of America, a well-known brick-and-mortar institution, offers a competitive interest rate on its 3-month CD. With a 4.00% APY, it provides a solid short-term investment opportunity. However, not all of Bank of America’s CDs pay competitive rates, so be sure to choose the right term for maximum returns.
TIAA Bank Basic 3 Month CD
TIAA Bank’s 3-month CD offers a competitive interest rate, as well as low early withdrawal penalties. With a 4.00% APY, this CD can be an attractive choice for short-term investments. Keep in mind that the bank has slightly stricter minimum opening deposit requirements compared to other institutions on our list.
Noteworthy Contenders
While our top picks stand out for their appealing features, there are other options worth considering. Here are some notable contenders:
- Chase 3 Month CD
- Citi Fixed Rate CD
- Bethpage Federal Credit Union Certificate Account
- Synchrony CD
- Ally High Yield CD
- Discover CD
- Quorum Federal Credit Union Term Savings
- Signature Federal Credit Union Certificate
- Navy Federal Credit Union Standard Certificate
- Consumers Credit Union CD
- Wells Fargo Standard Fixed Rate CD
- BrioDirect High-Yield CD
- Nationwide CD
- BMO Harris CD
Although these accounts didn’t make the cut as our top picks, they may still offer attractive features that align with your financial goals.
Trustworthiness and BBB Ratings
To provide a comprehensive assessment, we also evaluated the Better Business Bureau (BBB) ratings of each company. While a strong BBB score is a positive sign, it’s essential to consider other factors such as online reviews and personal recommendations. Here are the scores of our top contenders:
- Raisin: A rating (24 complaints)
- Bank of America: A- rating (government actions taken)
- TIAA: N/A
It’s worth noting that Bank of America and TIAA have been involved in recent public settlements. Bank of America settled claims related to overdraft fees, credit card rewards, and home loan denials, while TIAA settled over conflicts of interest disclosure.
Choose the Right CD for You
In conclusion, a 3-month CD can be a reliable way to grow your savings. By considering the expert advice, analyzing the top options, and evaluating your individual needs, you can confidently choose a CD that aligns with your financial goals. Remember to assess all the factors, including interest rates, early withdrawal penalties, and the reputation of the banking institution. With the right CD in hand, you’ll be on your way to maximizing your earnings and securing your financial future.
