Unlock Top No-Penalty CDs for December 2024: Best Rates & Easy Access!
We may earn a commission from our partners for the products featured on this page, and certain terms apply to the offers listed (check out our advertiser disclosure for more info). Rest assured, our opinions remain our own. For insights into our evaluation process, see how we assess banking products.
One of the main downsides of CDs is the fees associated with early withdrawals. But don’t fret! With no-penalty CDs, you can sidestep those pesky fees and enjoy greater flexibility.
We’re dedicated to tracking and presenting you with the absolute best no-penalty CD rates from leading nationwide financial institutions. As rates from the Fed dip, we’re committed to reporting the highest available returns, ensuring you stay ahead of the game.
No-penalty CDs are a rare breed, which means your choices may be limited. Currently, the standout offer is a fantastic 4.50% APY from the Farmers Insurance Federal Credit Union No-Penalty Share Certificate.
If you’re after a wider selection of terms and don’t mind the potential for penalties, check out our comprehensive guide on the best CD rates.
Top No-Penalty CD Rates
Our top picks for no-penalty CDs feature low minimum opening deposits, competitive rates, and a variety of term options to suit your needs!
Compare the Best No-Penalty CDs
The best banks and credit unions offering no-penalty CDs provide attractive interest rates paired with low minimum opening deposits. All of our top recommendations come from online banking platforms, which often boast more competitive rates than traditional brick-and-mortar banks.
Consider exploring eco-friendly banks or community development financial institutions (CDFIs). These establishments utilize your deposits to make a positive impact, whether it’s supporting the environment or serving underserved communities.
Our favorite liquid CD rates come with the safety net of FDIC or NCUA insurance. Remember, funds are secure at federally insured institutions — up to $250,000 per depositor is guaranteed! Discover more about the best no-penalty CDs below.
No-Penalty CD Reviews
Farmers Insurance Federal Credit Union No-Penalty Share Certificate
Farmers Insurance Federal Credit Union currently offers the top rate for a no-penalty CD with its nine-month No-Penalty Share Certificate. Anyone can join by becoming a member of the American Consumer Council, making it accessible to all! Just keep in mind that withdrawals are limited to once per month, with no withdrawals allowed in the first month.
Term length: 9 months
APY: 4.50% APY
Climate First Bank 6-Month No-Penalty CD
If eco-conscious banking is important to you, Climate First Bank offers a solid 6-month no-penalty CD. This bank supports environmental initiatives and offers inclusive banking options, making it a great choice for socially-minded savers. However, be aware that their CD options are somewhat limited.
Term length: 6 months
APY: 4.34% APY
Mission Valley Bank 3-Month No-Penalty CD
The Mission Valley Bank 3-Month No-Penalty CD, powered by Raisin, offers competitive rates and an incredibly low minimum opening deposit of just $1! A perfect option for those looking for short-term savings without the hassle of hefty minimums.
Term length: 3 months
APY: 4.35% APY
SkyOne Federal Credit Union 1-Year No-Penalty CD
SkyOne Federal Credit Union provides a no-penalty CD with a competitive rate and only a $1 minimum to open. It’s a solid choice for those who want a longer term without being locked in completely.
Term length: 1 year
APY: 4.25% APY
Ponce Bank 4-Month No-Penalty CD
Ponce Bank’s 4-Month No-Penalty CD is perfect for those looking for a middle-ground option. With a minimum deposit of just $1, it offers the flexibility you need!
Term length: 4 months
APY: 4.20% APY
America First Credit Union Flexible Certificate
America First Credit Union offers a unique no-penalty CD that allows you to make ongoing deposits and partial withdrawals throughout the term. This feature provides flexibility that is hard to come by in traditional CDs.
Term length: 12 months
APY: 4.20% APY
MYSB Direct 13-Month No-Penalty CD
MYSB Direct’s 13-Month No-Penalty CD boasts a strong rate and allows for up to three penalty-free withdrawals. However, keep in mind the minimum deposit requirement is $5,000.
Term length: 13 months
APY: 4.15% APY
Bank Trustworthiness and Ratings
When it comes to banking, trust matters. The Better Business Bureau (BBB) rates institutions based on customer complaints and transparency:
Farmers Insurance Federal Credit Union scores an A- rating due to a couple of customer complaints.
Climate First Bank has earned an A rating, likely due to its relatively short operational history.
USALLIANCE Federal Credit Union received a D- rating from the BBB for not addressing customer complaints.
MYSB Direct’s parent, M.Y. Safra Bank, has an NR rating due to insufficient information.
USALLIANCE Financial 11-Month No-Penalty Certificate
If you qualify for membership, the USALLIANCE Financial 11-Month No-Penalty Certificate is a great choice, featuring a low opening deposit of $500.
Term length: 11 months
APY: 4.00% APY
Types of No-Penalty CDs
Fully Liquid CDs
Some no-penalty CDs allow you to withdraw any amount at any time. If you’re leaning towards this option, make sure to read the terms closely, as withdrawal conditions can vary significantly.
CDs with Limited Withdrawals
Many no-penalty CDs do impose restrictions on withdrawals. For example, some might only let you withdraw your entire balance at once, while others may permit partial withdrawals but limit the number of times you can do so within the term.
What Influences No-Penalty CD Rates
Market Competition
Financial institutions frequently adjust their rates based on market demand. If competitors raise their rates, your bank will likely follow suit to attract new customers.
Overall Economic Conditions
The Federal Reserve’s decisions can also impact CD rates. Institutions adapt their offerings based on these announcements, meaning your rates can shift in response to economic changes.
Is Investing in a No-Penalty CD Right for You?
Choosing a no-penalty CD depends on your financial landscape. If you want to lock in a solid rate but anticipate needing access to your funds, this could be a wise move. Just remember that these typically offer lower rates than standard CDs, and high-yield savings accounts are also worth considering.
High-yield savings accounts might not provide the same fixed terms, but they can offer competitive rates, almost matching those of short-term CDs.
Best No-Penalty CD FAQs
While no-penalty CDs typically yield lower rates than standard CDs, there are noteworthy exceptions available that can provide decent returns.
Not every bank or credit union offers no-penalty CDs, so it’s essential to verify with your chosen institution before proceeding.
Yes, extra restrictions can apply to no-penalty CDs. For instance, some may only allow full balance withdrawals, while others might limit the frequency of partial withdrawals.
Always read the fine print for any CD you’re considering to confirm it’s truly no-penalty. If unclear, reach out to customer support for clarification.
For easy and frequent access to your funds, high-yield savings accounts generally outperform no-penalty CDs, which place restrictions on withdrawals.
No-penalty CDs could be a valuable choice if you foresee needing to withdraw cash before the term concludes and find a competitive rate compared to traditional CDs. Otherwise, a high-yield savings account or standard CD may better suit your needs.
Why You Can Trust Us: Expert Guidance on Selecting the Best No-Penalty CD
Our expert team has gathered insights on what to consider when choosing the right CD for you:
Choosing the Right Institution
– Tania Brown, CFP® professional & VP of Coaching Strategy: Ensure your bank is FDIC or NCUA insured. Consider how often you want to interact with your bank. Do you prefer walking into a physical branch or are online banking options more your style?
Prioritizing Your Needs
– Sophia Acevedo, Banking Editor: Compile a list of your account priorities. Some banks may charge monthly fees, so investigate how to waive those and seek accounts with superior interest rates compared to the average.
Planning Your Terms
– Roger Ma, CFP® professional: Reflect on when you’ll need your funds and compare that with current CD rates. Craft a plan that aligns with both your financial goals and your timeline.
Assessing No-Penalty CDs
– Mykail James, MBA, Certified Financial Educator: Look for attractive interest rates. If the rate is similar to high-yield savings accounts, that might be a better route due to greater flexibility in deposits.
How We Selected the Best No-Penalty CDs
Our dedicated team evaluated no-penalty CD offerings from various national banks, analyzing factors such as minimum opening deposits, features, fees, and interest rates. We also gauged the overall banking experience by assessing customer support, mobile app usability, security, and ethical standards.
