What is a CD? A CD is a type of deposit account that typically earns higher interest rates than traditional savings accounts, but comes with a fixed withdrawal or maturity date.
When you open a CD account, you agree to leave your money in the account for the term you select. If you take your money out before the it reaches its maturity date, you will be charged an early withdrawal penalty.
It’s important to know that penalties vary by bank and even by the term of a CD at the same bank. You can continue reading below to learn more about their penalties.
| Service Credit Union | 4.25% APY 9-Month CD | Review |
| Western Alliance Bank | 4.50% APY 3-Month CD | Review |
| Western Alliance Bank | 4.40% APY 6-Month CD | Review |
| First Tech Federal Credit Union | 4.35% APY 13-Month Share Certificate | Review |
| Sallie Mae | 4.35% APY 10-Month CD | Review |
| Western Alliance Bank | 4.25% APY 12-Month CD | Review |
| Ponce Bank | 4.25% APY 3-Month High Yield CD | Review |
| Sallie Mae | 4.25% APY 14-Month CD | Review |
| Ponce Bank | 4.15% APY 4-Month No-Penalty CD | Review |
| Live Oak Bank | 4.10% APY 12-Month CD | Review |
| Live Oak Bank | 4.10% APY 12-Month Business CD | Review |
| First Mid Bank & Trust | 4.08% APY 9-Month CD | Review |
| Discover Bank | Up to 4.00% APY CD | Review |
| Sun Canyon Bank | 3.87% APY 11-Month CD | Review |
| Western Alliance Bank | 3.85% APY 5-Month CD | Review |
| Quontic Bank | Up to 3.75% APY CD | Review |
| GreenState Credit Union | 3.65% APY 10-Month CD | Review |
| Blue Federal Credit Union | 3.55% APY 15-Month CD | Review |
| Blue Federal Credit Union | 3.50% APY 9-Month No Penalty CD | Review |
| CIT Bank | 3.50% APY 13-Month CD | Review |
| CIT Bank | 3.50% APY 11-Month No-Penalty CD | Review |
| Southwestern National Bank | 3.40% APY 8-Month CD | Review |
| Ponce Bank | 3.00% APY 1-Month High Yield CD | Review |
| CIT Bank | 3.00% APY 6-Month CD | Review |
| CIT Bank | 3.00% APY 18-Month CD | Review |
CD Early Withdrawal Penalties
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Financial institution |
Penalty |
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|---|---|---|
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Alliant Credit Union* |
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Ally Bank |
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American Express Bank |
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Bank5 Connect |
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Bank of America |
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Barclays |
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Capital One |
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Chase |
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CIT |
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Citibank |
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Citizens Access |
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Connexus Credit Union |
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Discover Bank |
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Marcus by Goldman Sachs |
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Navy Federal Credit Union* |
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Pentagon Federal Credit Union** |
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Popular Direct |
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PurePoint |
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Synchrony |
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TIAA Bank |
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Wells Fargo |
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* Alliant and Navy Federal CU’s penalties: You pay interest, regardless of how early you withdraw. Most banks have a fixed penalty that allows them to take from your original CD deposit if you withdraw your CD early enough. But in Alliant and Navy Federal CU’s case it’s different: if you withdraw your CD before it reaches the maximum days of the penalty, such as 90 days of interest for a 1-year CD, the penalty is only the interest you’ve earned for the days your CD was opened.
* PenFed’s penalties: PenFed uses expected interest. PenFed’s penalty has a greater chance of dipping into your original deposit, meaning you can actually lose money from a CD.
No-Penalty CDs
Early withdrawal penalties are standard, however there are exceptions where some CDs let you withdraw virtually at any time for free. These no-penalty CDs don’t have the highest rates, but you can find yields comparable to high-yield savings accounts. Not only that, your rate is locked in.
Editor’s Note: You can learn more about No Penalty CDs here and where you can find one!
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Bottom Line
Every bank has its own rules for penalties, so make sure you pay attention to their policies regarding early withdrawal. If you’re interested on finding a way to lock your money in, you can check out our master list of the best CD rates here on HMB!
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