Why You Can Trust the MarketWatch Guides Team
Here’s a breakdown of how we reviewed and rated top banks and credit unions
130
Institutions MonitoredOur team reviewed more than 100 of the country’s largest and most prominent financial institutions, from big banks like Chase and Bank of America to credit unions like Navy Federal Credit Union and PenFed Credit Union.
688
Products StudiedTotal number of checking, saving, CDs, and money-market accounts that inform our review ratings.
719
Rates TrackedThe accounts with an annual percentage yield (APY) several times the national average rate receive the highest scores. Accounts with the lowest APY offering (under 1%) earn the least points.
10
Professionals ConsultedBefore we began our research process, we consulted with financial advisors and industry experts to ensure our evaluations covered the banking product aspects that matter most to potential customers.
Top Offers of June 5, 2024
You could get over 10 times** the average savings account rate with our featured partners below.
*Annual Percentage Yield
**Accurate as of June 2024, assuming FDIC average savings rate of 0.45% and $2,500 deposit.
Our Picks for the Top 3-Year CDs With High Rates
To decide the best three-year CD rates, we looked at over 100 financial institutions. We focused on three-year CDs with high APYs and low minimum deposit requirements. We also looked at the overall banking experience and only considered accounts that are insured through the National Credit Union Administration (NCUA) or the Federal Deposit Insurance Corp. (FDIC). Learn more about our rating methodology.
- Quontic Bank – 3-Year CD APY: 4.40%
- BMO Alto – 3-Year CD APY: 4.60%
- First National Bank of America – 3-Year CD APY: 4.60%
- First Internet Bank – 3-Year CD APY: 4.61%
- Popular Direct – 3-Year CD APY: 4.50%
Quontic Bank
4.5
Three-Year CD APY4.40%Minimum Deposit Requirement$500Interest Compounding ScheduleDaily
Our Experience Opening a Quontic Bank CD
Two out of three MarketWatch Guides researchers who tried to open Quontic Bank CDs had their applications rejected. In both cases, Quontic provided an email that stated the bank couldn’t verify each applicant’s device, address, phone number or public records.
A Quontic phone representative said this is a common problem because the company uses a third-party provider to verify accounts. Two common reasons for denials are recent moves (both researchers had moved recently) and issues related to using virtual private networks (VPNs). If your application is rejected, you can call Quontic’s U.S.–based customer service representatives to ask them to release your application so you can apply again.
For our application that was accepted, we found the process to be short and smooth.
- Just nine seamless steps to apply for a CD and fund it from another bank account
- Starts earning interest as soon as you initiate the transfer
- User-friendly dashboard provides your complete credit report
- Knowledgeable U.S.-based customer service quickly connects you to a person once you enter your phone number
The email our research team received from Quontic customer service:
Source: Quontic.com via MarketWatch Guides user testing
Why We Like It
While Quontic Bank’s three-year online CD requires a $500 minimum deposit, this is less than the amount some competitors (such as Discover and Sallie Mae at $2,500) require. The account also gives you the flexibility to withdraw interest without paying the penalty that applies for withdrawing your principal early — two years’ interest.
Customer service is available online via chat or audio or by phone during business hours. Beyond letting you manage your CD, the Quontic mobile app includes financial tools such as credit monitoring and account syncing across banks, which allows you to view your bank accounts, credit cards or loans from any bank through the Quontic app.
Pros & Cons
Pros Competitive APY Allows you to withdraw interest early without a penalty Mobile app with credit monitoring and account syncing across banks Focus on customer support Cons Doesn’t have bank branches, so in-person support isn’t available Steep early withdrawal penalty of two years’ worth of interest for removing the principal before the CD’s maturity date No specialty CDs Applications are verified by a third-party provider and some get denied for common reasons like address changes for recent moves
BMO Alto
4.3
Three-Year CD APY4.60%Minimum Deposit Requirement$0Interest Compounding ScheduleDaily
Our Experience Opening a BMO Alto CD
We were impressed with BMO Alto’s website and its application process for an online CD.
- Option to save and retrieve your application later
- Simple, intuitive menus and interfaces to find statements and notices
- Gives you the higher interest rate on your CD if the rate increases after you open your account but before you fund it
- Website clearly shows the CD’s maturity date when we’re logged in, which isn’t the case with some other banks we opened accounts with
- Let us update account options online instead of requiring us to call
However, there were several parts of the technical experience that could use improvement.
- Account automatically logged us out twice even though we were actively using the site
- Site asked for our location during the application process
- Doesn’t have a mobile app, so you’ll need to use its online banking site to manage your account
- Technical errors when we linked our bank accounts
Source: Alto.bmo.com via MarketWatch Guides user testing
Why We Like It
Unlike our other top picks, the three-year high-yield CD from BMO Alto has no minimum opening deposit requirement, making it the most accessible option on our list. There’s also no minimum balance to earn the APY.
BMO Alto charges an early withdrawal penalty of 180 days of interest for taking principal out of the CD. However, you can have your monthly interest earnings transferred to an eligible account by calling the bank.
BMO Alto’s four- and five-year CDs offer the same APY, so you may want to consider a longer term. If you’re considering shorter term lengths, you can earn the online bank’s best rates with a six-month CD or a one-year CD.
Pros & Cons
Pros Competitive APY on all balances No minimum deposit requirement Penalty-free interest withdrawals Cons No in-person support at traditional BMO bank branches No mobile app or online chat support, so you must call for customer service Early withdrawal penalty of 180 days’ interest for removing principal from a CD No specialty CDs
First National Bank of America
4.3
Three-Year CD APY4.60%Minimum Deposit Requirement$1,000Interest Compounding ScheduleQuarterly
Why We Like It
First National Bank of America three-year CDs are available as standard or individual retirement account (IRA) CDs. While the standard CDs are available online, the IRA CDs are only available in person at one of the bank’s three Michigan branches.
Both options require a $1,000 minimum deposit, which is the same as the requirement from competitors such as EverBank and PenFed Credit Union. You can withdraw interest without a penalty, but withdrawing principal from a three-year CD early comes with a penalty of 360 days of interest.
This bank stands out from our other top picks for its in-branch customer service. You can also call or mail the bank. Besides its online banking site, First National Bank offers a highly rated mobile app that lets you manage your CD account.
Pros & Cons
Pros Highly competitive APY Three branches for in-person support Early interest withdrawals allowed without a penalty Cons $1,000 minimum opening deposit requirement IRA CDs only available at a branch Steep early withdrawal penalty for removing the principal
First Internet Bank
4.4
Three-Year CD APY4.61%Minimum Deposit Requirement$1,000Interest Compounding ScheduleMonthly
Why We Like It
The three-year high-yield CD from First Internet Bank requires a $1,000 initial deposit, which is on par with competitors such as CIT Bank and Alliant Credit Union. As long as you only withdraw your earned interest, you can avoid the early withdrawal penalty that applies for taking principal out before the CD’s maturity date (360 days of interest).
While this online bank doesn’t have branches, it offers various ways to get help during business hours. You can call, email or use its online contact form. Whether you prefer text updates, an online banking site or a mobile app, you’ll have plenty of ways to monitor your three-year CD’s balance.
Pros & Cons
Pros Highly competitive APY No penalty for withdrawing interest early Multiple customer support options Cons No branches for in-person support Early withdrawal penalty for taking principal out of the account $1,000 minimum opening deposit requirement No specialty CDs
Who It’s Best For
First Internet Bank’s three-year CD is best for those who want a high APY and can afford the $1,000 minimum deposit.
Popular Direct
4.2
Three-Year CD APY4.55%Minimum Deposit Requirement$10,000Interest Compounding ScheduleDaily
Why We Like It
Getting Popular Direct’s three-year CD and its competitive APY requires a hefty $10,000 minimum opening deposit, which is the highest out of our top picks. There’s an early withdrawal penalty of 365 days of simple interest to access the principal or interest, so commitment is very important.
This online bank doesn’t have physical locations, but it does offer extended phone support hours daily, a mailing address and secure messaging through your online account. Popular Direct also has a mobile app that includes basic tools for watching your CD balance and working toward savings goals.
Pros & Cons
Pros Competitive APY Extended customer support hours Mobile app with savings tools Cons Large minimum deposit requirement of $10,000 Hefty early withdrawal penalty for removing principal or interest No branches for in-person support
Who It’s Best For
Popular Direct’s three-year CD suits savers who have at least $10,000 to deposit and are sure they won’t need their deposit during the CD term.
Rates accurate as of May 31, 2024.
Highest 3-Year CD Rates
The table below includes the highest 3-year certificate of deposit (CD) rates available today.
| Financial Providers | CD Term | APY |
| Merchants Bank of Indiana | 3 years | 5.92% |
| Dollar Savings Direct | 3 years | 5.00% |
| Raymond James Bank | 3 years | 4.85% |
| Alliance Bank Central Texas | 3 years | 4.73% |
| Newtown Savings Bank | 3 years | 4.75% |
| MYSB Direct | 3 years | 4.70% |
| Luana Savings Bank | 3 years | 4.65% |
| Pacific Crest Savings Bank | 3 years | 4.70% |
| Community Savings | 3 years | 4.67% |
| Nebraskaland National Bank | 3 years | 4.65% |
Is Now the Right Time To Open a 3-Year CD?
Now is an excellent time to open a three-year CD. While CD rates have dropped slightly in 2024, they’re still at some of their highest levels in more than 15 years. Our experts predict rates will fall later in the year.
“For those considering CDs as an investment, the window to secure a good rate might be narrowing,” said Taylor Kovar, CFP, CEO and founder of Kovar Wealth Management. “Securing a CD sooner rather than later could lock in higher returns before rates drop.”
In our recent MarketWatch Guides CD survey of 1,000 Americans, respondents told us the main reason they opened a CD was to take advantage of high interest rates.
Shawn Carpenter, CEO of investment-tracking company Stock Alarm, said, “If you've been eyeing CDs as an investment, you still have some wiggle room to snag decent rates, but don't dilly-dally too long. Since CD rates are expected to keep slipping in 2024, it's wise to lock in a rate sooner rather than later to avoid losing out on better deals.”
“The most important benefit of a long-term CD is that you have the predictability of knowing what interest you will earn, for a longer period of time. That predictability is worth a lot to some people, especially if they have a long-term goal that needs a predictable outcome,” Renee Stene, financial advisor and founder, Weddington Advisors
Renee Stene, financial advisor and founder, Weddington Advisors
CD CALCULATOR
Certificates of deposit generally have higher interest rates, but less flexibility, than savings accounts. Enter your deposit, CD term and annual percentage yield (APY) to see what you would earn on a certificate of deposit.
CD INFORMATION
YOUR ENDING BALANCE
$1,025
Total Interest Earned
$25
Initial Balance
$1,000
What Are 3-Year CDs?
A three-year CD is a savings option that traditionally lets you make an opening deposit and get a fixed interest rate for three years. Because market rates are expected to drop in 2024, shorter-term CDs typically have higher APYs than three-year terms. If you make an early withdrawal of principal, you’ll likely pay a penalty unless you have a flexible or no-penalty CD.
Benefits of 3-Year CDs
Three-year CDs are beneficial for those who don’t like risk and prefer a modest, stable return. Their safety comes from features such as NCUA or FDIC insurance and fixed rates, meaning there’s no threat of market issues hurting your account balance.
Since you’ll know your guaranteed rate for the next three years, you can easily calculate your savings’ increase and not worry about falling rates if something changes in the economy.
Fixed vs. Variable Rates
Most three-year CDs pay a fixed interest rate through maturity. But if you prefer future rate increases, look for bump-up and step-up CDs. Bump-up CDs give you the option to ask for at least one rate hike if your bank advertises a better rate during your term. Step-up CDs have set rate changes at certain intervals.
Whether your rate is fixed or variable, find out how often the bank compounds interest since this makes a small difference in earnings.
Average Rates for 3-Year CDs
The national average interest rate for a three-year CD is rather low at 1.94%, but our top picks pay at least three times this rate. While your rate is fixed once you have the account, you’ll find that three-year CD rates in the market widely vary. Here are some factors that impact CD rates:
- Economic conditions, including market stability and inflation levels
- The Federal Reserve’s decisions to lower or raise the federal funds rate, which affects what banks pay for overnight loans
- Account promotions, balance requirements or customer loyalty benefits
- Bank competition and the need for deposits
Average Rates for Other Types of CDs
| Term | National Average APY |
| 3 months | 1.54% |
| 6 months | 2.48% |
| 12 months | 2.59% |
| 18 months | 2.22% |
| 2 years | 2.08% |
| 3 years | 1.94% |
| 5 years | 1.91% |
Minimum Opening Deposit and Balance Requirements
Ensure you can afford the minimum amount to open your three-year CD account. If the account has balance tiers, check how much you need to get a good APY.
Some banks charge a year or more of interest for withdrawing any part of your initial deposit from a three-year CD, so you should also find out what the penalties are for any CDs you’re interested in. Also research whether the CD options you’re considering let you withdraw interest early without penalties.
Types of CDs
A bump-up CD allows you to get a set number of rate increases if the bank offers higher rates during your term. If you think rates will go up, you may want to consider this CD type. Most bump-up CDs have terms that last at least two years. Examples include:
- Ally Bank: Two- or four-year term
- First Tech Federal Credit Union: 13-month term or two- or three-year term
- Synchrony: Two-year term
A step-up CD automatically increases your interest rate on a schedule, usually every few months. However, the highest rate on a step-up CD probably won’t beat a traditional CD’s rate. Examples include:
- Marcus by Goldman Sachs: 20-month term
- U.S. Bank: 28-month term
A no-penalty CD usually has a much lower rate than a traditional CD, but there’s no penalty if you withdraw your money early. This type of CD is best for those who may need their funds earlier than the maturity date and aren’t as worried about getting the best CD rates. Examples include:
- Ally Bank: 11-month term
- Marcus by Goldman Sachs: seven, 11- or 13-month term
- Synchrony: 11-month term
Alternatives To 3-Year CDs
Even if a three-year CD sounds appealing, a different CD term or an alternative deposit account may better fit your needs, especially if you’ll avoid early withdrawal penalties.
| Feature | 3-Year CDs | High-Yield Savings Accounts | Money Market Accounts | Bonds |
| Type of investment | Time deposit | Savings account | Savings account | Debt security |
| APY | Typically fixed | Variable | Variable | Fixed or variable |
| Timeline | 3 years | No fixed term | No fixed term | Fixed term |
| Risk | Low | Low | Low to moderate | Low to moderate |
| Ease of access | Limited access until maturity | Immediate access | Immediate access | Varies depending on the bond type and market conditions |
| Initial deposit | Varies | Typically low | Typically low | Varies |
| Insured by the FDIC or the NCUA | Typically | Typically | Typically | No |
The Bottom Line: Is a 3-Year CD Right For You?
A three-year CD may be right for you if your financial goal is at least three years away. With high rates from our top picks, a CD can be a safe option for growing your money with predictability.
But consider your personal finance needs and the potential drawbacks of long-term CDs, such as high deposit requirements or penalties if you need to withdraw your money early.
FAQ: 3-Year CD Rates
Based on the national averages from the FDIC, a three-year CD pays a lower rate than most short-term CDs. When compared to CD rates for four- or five-year terms, three-year CDs rates are about the same.
You can expect your financial institution to offer a grace period when your three-year CD matures. During this period of time, you can redeem your CD, renew it or make changes to reinvest the money. Some banks may automatically renew the CD if you don’t do anything.
Most financial institutions allow early withdrawals from a three-year CD, but you’ll often pay a penalty. There may also be a waiting period. If you think you might need to withdraw your money early, you may want to consider a shorter-term CD or a no-penalty CD to avoid early withdrawal fees.
Methodology
Our team researched more than 100 of the country’s largest and most prominent financial institutions, collecting information on each provider’s account options, fees, rates, terms and customer experience. We then scored each firm based on the data points and metrics that matter most to potential customers. Read our full methodology.
For our list of the best three-year CD rates, we selected the highest-scoring financial institutions in our review of CDs. These banks and credit unions provide CD products available to customers throughout the U.S. and earn high scores for offering low or no minimum opening deposit and competitive yields on three-year terms.
For the banks that we opened CDs with, we provided at least the minimum deposit and measured the speed and thoroughness of the account-opening process. We evaluated the ease of use of the account website, the speed of our deposit to fund the account, the rewards and features available to account holders and our experience with customer service chat and phone options.
Rates accurate as of May 31, 2024
**Data accurate at time of publication
*Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor. Weddington Advisors and Great Valley Advisor Group are separate entities from LPL Financial.
Certificates of Deposit are FDIC insured and offer a fixed rate of return if held to maturity. There is no assurance that the techniques and strategies discussed are suitable for all investors or will yield positive outcomes. The purchase of certain securities may be required to effect some of the strategies. Investing involves risks including possible loss of principal.
If you have feedback or questions about this article, please email the MarketWatch Guides team ateditors@marketwatchguides.com.
