5 CDs with rates over 4.5% APY (and no penalties)
When it comes to earning high rates of interest on their money, savers have a lot of choices right now. While the Federal Reserve's recent rate hikes have resulted in much higher costs for borrowers, they've also led banks, credit unions and other financial institutions to offer significantly higher APYs on interest-bearing accounts, like high-yield savings accounts and certificates of deposit (CDs).
But if you're looking for a CD with a high APY, you may have realized that most charge penalties for withdrawing your money before the term is complete. That isn't the best option if there's a chance you may need to access your money before the CD has matured.
Luckily, there are certain CDs that offer flexibility in terms of your withdrawal date. These no-penalty CDs can be a smart option if you'd like to reap the benefits of the high APYs being offered right now but don't want to commit.
Curious about the rate you could be earning on your savings? Find out here.
5 CDs with rates over 4.5% APY (and no penalties)
If you're looking for a CD with flexible withdrawal terms, an APY over 4.5% and no penalties, consider one of the following:
America First Credit Union: 5.00% APY
America First Credit Union, one of the 10 largest credit unions in the nation, currently offers a 12-month CD account that functions much like a regular no-penalty CD — and it currently comes with a high APY of 5.00% and a low minimum deposit of $500.
However, it's important to note that the rules for this CD are a bit different. Account holders are indeed allowed to withdraw money without a penalty — but only one free withdrawal is allowed, and it must occur during the first five calendar days of each quarter. If you can work within those parameters, though, the high rate and low minimum deposit make it worth a look.
USAlliance Federal Credit Union: 5.00% APY
USAlliance Federal Credit Union offers an 11-month no-penalty CD with a high rate of 5.00% APY — and it's coupled with a low minimum deposit of $500.
With this CD, you're able to make a penalty-free withdrawal of your principal seven days after opening the account. That said, you can't make partial withdrawals if you're taking your money out early. You'll have to take out all of your balance or none of it if you're making an early withdrawal.
CIT Bank: 4.90% APY
CIT Bank, an online bank that's a subsidiary of First Citizens Bank, also offers a no-penalty CD with a rate well above 4.5%. This 11-month CD has a rate of 4.90% currently — and if you need to withdraw your money early, you won't pay a penalty to do it. And, that includes the principal and interest you've earned to that point.
However, at $1,000, the minimum deposit is higher than the requirements with some other no-penalty CDs. So, if you don't have enough to meet that minimum, you may want to look elsewhere.
Ally Bank: 4.55% APY
Ally Bank currently offers an 11-month no-penalty CD with an APY of 4.55% — and what's unique about this CD is that there is no minimum deposit requirement to open it. That flexibility makes it accessible to nearly everyone, and you also get 60 days to fund the account after opening it.
The withdrawal timeline is also shorter than some other no-penalty CDs. WIth Ally's no-penalty CD, you are able to withdraw the entire balance and any interest you've earned six days after funding the account.
However, you must withdraw the total balance if you're going to take out your money early. There's no option for a partial withdrawal with this CD.
Marcus by Goldman Sachs: 4.50% APY
If you open a CD with Marcus, you have your choice between three no-penalty CDs: a 7-month CD, an 11-month CD and a 13-month CD.
However, only the 13-month no-penalty CD offers a rate of 4.50%. The other two no-penalty CDs from Marcus offer rates well below that threshold, at 0.45% APY and 0.35% APY respectively.
With the 13-month no-penalty CD, you're able to withdraw your principal and interest as early as seven days after funding without paying a penalty. And, the minimum deposit requirement is also low at $500, making this CD accessible to most savers.
Learn more about the top savings rates you could qualify for here.
The bottom line
If you don't think you can commit to a CD term just yet, or if you aren't sure whether you'll need to access your savings in the near future, you still have the option to earn a high guaranteed APY on your money with a no-penalty CD. These accounts offer you more flexibility in terms of withdrawing your money — and there aren't any associated penalties to worry about. Just make sure to do your research before committing so you fully understand the requirements and the withdrawal terms before opening one.
