August 2023’s Top 5-Year CD Rates (Up to 4.65%)

August 2023's Top 5-Year CD Rates (Up to 4.65%)

The Best 5-Year CD Rates: Where to Keep Your Money Safe and Growing

Investing your money in a certificate of deposit (CD) can be a smart way to earn a competitive interest rate while keeping your savings safe. A 5-year CD, in particular, is a great option if you don’t need immediate access to your funds and are looking for a higher yield. In this article, we will highlight the best 5-year CD rates available and provide expert insights on how to choose the right CD for your needs.

The Best 5-Year CD Rates

We have thoroughly researched banks and credit unions to find you the top 5-year CD rates available. These institutions offer not only high interest rates but also additional benefits such as low minimum opening deposits, low early withdrawal penalties, and user-friendly mobile apps. Here are our top picks:

1. First National Bank of America 5 Year CD: 4.65% APY
2. Popular Direct 5 Year CD: 4.60% APY
3. First Internet Bank of Indiana 5 Year CD: 4.59% APY
4. Barclays 5 Year Online CD: 4.50% APY
5. Crescent Bank 5 Year CD: 4.40% APY
6. Alliant 5 Year Certificate: 4.35% APY
7. Delta Community Credit Union 5 Year CD: 4.35% APY

Please note that these top picks are protected by FDIC or NCUA insurance, ensuring the safety of your funds. Even though banks like Silicon Valley Bank, Signature Bank, and First Republic Bank have recently been shut down, it is important to remember that money deposited in a federally insured financial institution is secure, with up to $250,000 per depositor protected in a bank account.

Choosing the Right 5-Year CD Term

Deciding on the term of your CD is an important step in maximizing your returns. Generally, a 5-year CD is ideal for individuals who don’t need access to their funds for a few years. However, it’s crucial to consider your future financial needs and goals. If you are planning to make a significant purchase, like buying a house, within the next five years, a shorter-term CD might be more suitable.

To determine the right term for your CD, start by evaluating when you will need the money. Once you have a clear timeline, you can compare available rates. Sometimes, it may be worth leaving your funds in the bank for a few more months or a year to take advantage of higher interest rates.

• August 2023’s Top 6 Bitcoin IRAs
• I’ve tested 30+ electric cars. Check out the top luxury rides...
• UK house prices drop sharply, the most since 2009, according to Nat...

CD or High-Yield Savings Account?

When deciding where to deposit your money, you have several options, including high-yield savings accounts, money market accounts, and CDs. Each type of account serves different purposes, and it’s perfectly acceptable to have multiple accounts for different financial goals.

High-yield savings accounts are ideal for emergency funds or money that you may need quick access to. These accounts offer competitive interest rates and flexibility in making regular withdrawals. On the other hand, money market accounts provide higher interest rates while still allowing for regular withdrawals.

CDs, like the 5-year ones mentioned above, are excellent for keeping a substantial savings sum untouched and out of sight, while earning a strong interest rate. They are ideal for long-term financial goals where you don’t need immediate access to your funds. By locking in your money for a fixed term, you can typically enjoy higher interest rates compared to regular savings accounts.

It’s crucial to consider your financial objectives and the specific purpose of your savings when deciding between a CD, high-yield savings account, or money market account.

Expert Advice on Choosing the Best 5-Year CD

To provide you with valuable insights, we consulted four financial experts who shared their expertise in choosing the right CD. Here’s what they had to say:

1. Tania Brown, CFP at SaverLife
2. Roger Ma, CFP with lifelaidout® and author of “Work Your Money, Not Your Life”
3. Sophia Acevedo, CEPF, banking reporter, Personal Finance Insider
4. Mykail James, MBA, CFEI, BoujieBudgets.com

These experts agree that when selecting a CD, it’s crucial to consider the term that aligns with your financial goals. They emphasize the importance of evaluating when you’ll need the money and how you plan to use it. If you have a specific goal, such as buying a house or funding a major expense, it’s essential to choose a CD term that matches your timeline.

Additionally, they advise comparing interest rates offered by different institutions to ensure you get the best return on your investment. By considering these expert tips, you can make an informed decision and maximize the benefits of your CD.

Our Methodology

We have conducted extensive research to compile a list of the best 5-year CD rates available. Our team evaluated over 20 banks and credit unions, considering factors such as minimum opening deposits, early withdrawal penalties, interest rates, customer support availability, mobile app ratings, and ethics. By thoroughly examining these institutions, we have identified the most well-rounded options for you to consider.

Frequently Asked Questions about 5-Year CDs

1. What is a CD?
2. What are the benefits of a 5-year CD?
3. How is the interest on a CD calculated?
4. Can I withdraw money from a CD before the maturity date?
5. Are CDs insured?

For answers to these and other frequently asked questions about 5-year CDs, please refer to our dedicated FAQ section.

In-Depth Reviews of Top 5-Year CDs

To provide you with a comprehensive understanding of each top pick, we have conducted in-depth reviews of the best 5-year CDs. Below are the detailed reviews of the CDs mentioned earlier, focusing on their standout features, interest rates, early withdrawal penalties, and potential drawbacks. These reviews will help you make a well-informed decision when choosing the right 5-year CD for your financial goals.

1. First National Bank of America 5 Year CD
2. Popular Direct 5 Year CD
3. First Internet Bank of Indiana 5 Year CD
4. Barclays 5 Year Online CD
5. Crescent Bank 5 Year CD
6. Alliant 5 Year Certificate
7. Delta Community Credit Union 5 Year CD

Other 5-Year CDs Considered

In addition to our top picks, we also evaluated several other 5-year CDs. While these CDs have their own merits, our top selections offer higher interest rates, lower minimum opening deposits, and lower early withdrawal penalties, making them more compelling options. However, it’s worth exploring these additional CDs to see if they align with your specific needs.

Bank Trustworthiness and BBB Ratings

When choosing a financial institution to entrust with your money, it’s important to consider their trustworthiness. To provide a comprehensive picture, we have compared each company’s Better Business Bureau (BBB) score. The BBB assesses businesses based on various factors such as responses to customer complaints, advertising honesty, and transparency of business practices. While a good BBB rating is favorable, it’s also advisable to research customer reviews and seek additional information to ensure the bank meets your specific requirements.

By considering these factors, engaging with our expert advice, and reviewing our top picks, you can choose the right 5-year CD and safely grow your savings. Remember, a 5-year CD can provide you with financial security and higher returns while ensuring your funds remain intact until you reach your goals.

• 5-Year CD
• Personal Finance Insider
• PFI Guide