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Online banks and credit unions have higher interest rates than the average CD. The most competitive 18-month CDs offer up to 5.25% Annual Percentage Yield (APY).
If you prioritize a low-risk savings option and don't need immediate access to your money, an 18-month term might be worth considering. If you're interested in other CD term lengths, check out our overall best CD rates guide. Here are our top picks.
The Best 18-month CDs
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These are our picks for the best 18-month CD rates. Our top picks for CDs are protected by FDIC or NCUA insurance. Although Silicon Valley Bank, Signature Bank, and First Republic Bank have recently been shut down, keep in mind money is safe at a federally insured financial institution. When a financial institution is federally insured, up to $250,000 per depositor is secure in a bank account.
Compare the Best 18-month CDs
Expert Advice on Choosing the Best 18-month CD
To learn more about what makes a good CD and how to choose the best fit, four experts weighed in:
Insider
Here's what they had to say about CDs. (Some text may be lightly edited for clarity.)
How can someone determine whether a bank is the right fit for them?
Tania Brown, certified financial planner at SaverLife:
"Obviously, you want to make sure it's FDIC insured. Also, your banking experience — do you like walking into a bank? Well, then you need someone local. Do you just not care if you ever see your bank? Then you're okay online. Do you write checks? Do you not write checks? So it's thinking through how your experience with it is going to be before you make that decision."
Sophia Acevedo, certified educator in personal finance, banking reporter, Personal Finance Insider:
"I would create a list of what I prioritize most in a bank account. For example, some banks have accounts that charge monthly service fees. I would look to see what the requirements are for waiving the monthly service fee and whether I think I could feasibly meet those requirements each month. If I'm searching for an interest-earning bank account I'll pay attention to interest rates. I would make sure the account pays a higher interest rate than the average bank account."
How should someone choose a CD term length?
Roger Ma, certified financial planner with lifelaidout® and author of "Work Your Money, Not Your Life":
"I would think about when you need the money and then compare that with what the prevailing CD rates are, and then what makes sense from a financial perspective, but also from your own personal timing perspective."
Mykail James, MBA, certified financial education instructor, BoujieBudgets.com:
"I believe in having a plan for whatever the funds are. If it's supposed to be a house fund, and you want to wait for another two years to buy a house, that's what you should be thinking of when you want to have this money."
How should someone decide whether to put their money in a high-yield savings account, money market account, or CD?
Tania Brown, CFP:
"So I guess we'll start off with how much money you want to put in and ... the level of transactions you want to have. If you want to have any transactions, that automatically takes out CDs. Then you're stuck between the high-yield savings and the money market account."
Sophia Acevedo, Personal Finance Insider:
"Generally, I think a high-yield savings account or money market account could be good options for an emergency fund or short-term savings goals. A high-yield savings account offers a higher interest rate than traditional savings accounts at brick-and-mortar banks. Meanwhile, money market accounts might be worth considering if you want more account accessibility — several offer paper checks, ATM cards, or debit cards. CDs could be worthwhile if you don't need access to some of your money, since they have a fixed interest rate for a specific term."
Our Methodology
At Personal Finance Insider, our goal is to create helpful reviews, guides, and explainers so that you can make good decisions about your money. We recognize every person has distinct preferences, so we provide ample options to help you find the most suitable financial product or account.
First, we researched to find over two dozen banks and credit unions that offered 18-month CDs. Then, we reviewed each institution to find the most-well rounded banking options. For each account, we compared the minimum opening deposits, early withdrawal penalties, and interest rates. We also considered the overall banking experience at each bank by assessing customer support availability, mobile app ratings, and ethics. Read more about how we rate CDs.
18-month CD Frequently Asked Questions
What is an 18-month CD?
An 18-month CD is a type of savings account. You make a one-time deposit and keep money in the account for 18 months. In return, banks offer a fixed interest rate so you can earn a little extra on your savings. You'll have the option to renew your CD at the end of the 18-month period or close the account and pocket the money.
CDs do not charge monthly service fees, but you may have to pay an early withdrawal penalty if you decide to take out money before the end of your term. You also typically won't be able to deposit more money before the CD matures.
How does an 18-month CD work?
Traditional CDs lock in your rate for a specific term. Let's say, for example, you want to open an 18-month CD that pays 5.00% APY. You'll earn 5.00% APY for 18 months — the rate won't fluctuate until your term ends. If you choose the renew your CD after it matures, you'll earn the new rate that is currently offered by your bank.
Who has the highest CD rates for 18 months?
The highest 18-month CD rate on our list is available at CFG Bank. The offers APY.
Which is better: a short-term CD or a long-term CD?
Typically, your choice will likely depend on how soon you plan to need the money.
For example, if you want the money to buy a house in less than a year, a longer term isn't the best idea. If you don't need access to your money soon and you're searching for a low-risk option, a CD might be a worthwhile option.
Many experts recommend CD laddering. With this strategy, you open multiple CDs with different term lengths so you can take advantage of higher rates with longer terms, but also access some of your money earlier. For instance, you might open 6-month, 18-month, and 5-year CDs at the same time, which means you'll get some of your money back in six months, then more in 18 months, then more in five years.
Which is better: an 18-month CD or a high-yield savings account?
Choosing between an 18-month CD or a high-yield savings account may ultimately depend on your goals and preferences.
You may prefer a high-yield saving account over a CD if you want quick access to your money. If you need access to money from your 18-month CD before it matures, then you'll usually have to pay a fee. In comparison, you should be able to access funds from your savings account regularly.
A CD also locks in your rate for the entire term. If rates are dropping, this could make the CD a better choice, because the interest rate on your saving account could decrease over the next few months. If rates are rising, the savings account might be a better fit, because your rate could go up. Either way, there's a good chance rates will fluctuate over an 18-month period.
Which is better: an 18-month CD or a money market account?
Like with a high-yield savings account, you may prefer a money market account over a CD if you want quick access to your money. Money market accounts often come with debit cards or paper checks so you can use your account for spending. With a traditional CD, you usually face a penalty if you want to take out money from an account before the end of its term.
Money market account rates also fluctuate, so you may prefer a money market account if rates are rising, but a CD if rates are dropping. Still, remember that rates will likely go up or down over a 6-month term.
Is an 18-month CD a good investment?
CDs are generally viewed as a savings account. CDs are a low-risk option since you're guaranteed fixed returns as long as you keep your money in an account for an entire time. Your potential gains, however, are limited.
If you're comfortable parting with your money for longer and want to take more risk with your money, then you may want to invest in the stock market. One way to do this is through tax-advantaged retirement accounts, like a 401(k) or IRA, which grows your money over decades. Another is through brokerage accounts, which are useful tools to build long-term wealth, but can't guarantee a given return like a CD can.
Why it stands out: CFG Bank has a high interest rate on its 18-month CD, and you'll only need upfront to open one.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 180 days of interest
What to look out for: CFG Bank doesn't have many CD terms to choose from — there are only 12-month, 13-month, 18-month, 36-month, or 60-month CDs. If you're looking for more CD options, you might prefer another institution.
Why it stands out: If you would rather join a credit union than a bank, Alliant Credit Union is a great online option regardless of where you live in the US. Alliant Credit Union pays competitive CD rates, particularly for 1-year and 18-month terms.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 120 days of interest
What to look out for: Credit unions require you to become a member to open accounts. The easiest way to become a member is to join Foster Care to Success. Alliant will cover your $5 joining fee.
Why it stands out: CIBC Bank USA, the US division of the Toronto-based bank Canadian Imperial Bank of Commerce, has competitive CD rates on 1-year, 18-month, and 2-year terms. With the 18-month and 2-year term, you'll also earn a higher rate if you deposit $25,000 or more.
CIBC Agility CDs also have low early withdrawal penalties compared to other banks.
Interest for an 18-month CD: APY
1-year CD early withdrawal penalty: 30 days of interest
What to look out for: CIBC Bank USA has an online savings account and CDs that you can open anywhere in the US. To open a checking account or money market account in the US, you must live in a state that has a banking center. Banking centers are only located in Illinois, Michigan, Missouri, and Wisconsin.
Why it stands out: Ally High Yield CDs have a minimum opening deposit, and the 18-month term offers the highest interest rate right now. You also might like Ally if you'd like to open other types of bank accounts. Ally has a high-yield savings account, interest-earning checking account, money market account, and specialty CDs.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 60 days of interest
What to look out for: You may be able to find other online banks that offer slightly higher rates on CDs.
Why it stands out: Sallie Mae pays a competitive interest rate on its 18-month term.
It's also a good option if you're searching for a variety of CD terms. Usually, banks offer CDs ranging from six months to five years. At Sallie Mae, you'll have more options to choose from. For example, the online bank has 9-month, 15-month, and 30-month terms.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 180 days of simple interest
What to look out for: Sallie Mae CDs require a minimum of . Usually, banks only require $1,000 for CDs.
Why it stands out: Popular Direct pays a competitive rate, and it compounds interest daily.
APY for 18-month CD: APY
18-month CD early withdrawal penalty: 270 days of simple interest
What to look out for: You'll need at least to open a Popular Direct CD. The early withdrawal penalty is also fairly high.
Why it stands out: Crescent Bank has high interest rates on a variety of online CDs. It also has standard early withdrawal penalties for an 18-month term.
To deposit money into an online Crescent Bank CD, you may mail a check or transfer money from an account from another bank or credit union.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 180 days of interest
What to look out for: Crescent Bank CDs will automatically renew at the end of each term, unless you call customer service to cash out your CD.
Why it stands out: The online bank First Internet Bank of Indiana has a competitive interest on several CDs. First Internet Bank of Indiana also has savings, checking, and money market accounts.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 180 days of interest
What to look out for: First Internet Bank of Indiana compounds your interest monthly, not daily. Depending on how much money is in your CD, this might or might not make a significant difference.
First Internet Bank of Indiana Review
Why it stands out: Air Force Federal Credit Union pays high rates on 18-month CDs regardless of your balance, and you'll earn the best rate on a jumbo CD that requires a $100,000 minimum deposit.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: AFFCU early withdrawal penalties depend not just on your term length, but on how long the money has been in your account before you withdraw
What to look out for: Like most credit unions, AFFCU compounds interest monthly, not daily. Depending on your balance, this may or may not make a significant difference in how much you earn. You'll also need to be eligible for membership before opening an account — the easiest way to qualify is by joining either the Airman Heritage Foundation or Dream Educational Foundation.
Why it stands out: Barclays CDs have a minimum opening deposit and low early withdrawal penalties compared to other banks.
Interest for an 18-month CD: APY
18-month CD early withdrawal penalty: 90 days of interest
What to look out for: Barclays only offers a high-yield savings account and CDs. If you're looking for a bank to open a checking or money market account, then consider one of our other picks.
Other 18-month CDs We Considered
- : Synchrony CDs have a minimum opening deposit, but our top picks offer more competitive rates right now.
- : Discovers CDs require a minimum of . Our top picks also have higher interest rates for an 18-month term.
- : Marcus CDs have a low minimum opening deposit, but its 18-month term has a lower interest rate than our top picks.
- : Our top picks have higher interest rates and lower early withdrawal penalties.
- : CIT Bank has variety of CD terms, but our top picks have higher interest rates for an 18-month term.
- : Capital One 360 CDs have a minimum opening deposit, but our top picks have more appealing interest rates right now.
- : Citi CDs have a minimum opening deposit. But if you're strictly searching for a high rate, our top picks might be a better choice.
- : Bask Bank has fewer term options than most of our top picks. Its CD rates are also lower than our top picks.
- : You'll need at least to get a CD. Our top picks have lower minimum opening deposits.
- : Popular Direct offers APY, but it wasn't one of our top picks because you'lll need at to open a CD.
- : Live Oak CDs require at least . Our top picks have lower minimum opening deposits.
- : Bethpage offers a high interest rate on some CDs. Its 18-month CD doesn't stand out as much as our top picks.
- : Nationwide offers a solid interest rate on its 18-month CD, but our top picks pay higher interest rates.
- : TIAA has a variety of CD terms, but our top picks offer even higher rates.
- : American Express has a low minimum opening deposit, but our top picks pay higher interest rates.
- : Bank5 Connect has solid CD rates on short-term CDs, but its 18-month CD doesn't stand out as much our top picks do.
- : Navy Federal Credit Union has solid interest rates, but our top picks have higher interest rates.
- : Charles Schwab has brokered CDs, meaning Charles Schwab doesn't actually own the CD. Instead, Charles Schwab acts as the middleman for you and the bank that owns the CD. Depending on your preferences, you may prefer open a CD directly with the financial institution.
- : TAB Bank's 18-month CD offers a lower interest rate than our top picks.
- : Quorum Federal Credit Union's 18-month CD isn't as competitive as some of its other terms.
Bank Trustworthiness and BBB Ratings
We've compared each company's Better Business Bureau score. The BBB grades businesses based on factors like responses to customer complaints, honesty in advertising, and transparency about business practices. Here is each company's score:
| Institution | BBB rating |
| CFG Bank | None |
| Alliant Credit Union | A+ |
| CIBC Bank USA | A+ (F rating from parent company) |
| Ally | A |
| Sallie Mae | A+ |
| Popular Direct | A+ (Rating for its parent bank, Popular Bank) |
| Crescent Bank | A+ |
| First Internet Bank of Indiana | A+ |
| Air Force Federal Credit Union | F |
| Barclays | A+ |
CFG Bank currently doesn't have a rating because its profile is being updated on the BBB website. Ally received an A rating from the Better Business Bureau because it has a few unresolved customer complaints.
The BBB gave CIBC Bank USA an A+ rating. However, its parent company CIBC has an F rating because the BBB has received numerous complaints, and the bank hasn't responded to or resolved some complaints. AFFCU also has an F grade because it has a number of complaints and hasn't resolved some of them.
A good BBB rating doesn't necessarily mean that your relationship with the bank will be perfect. Talk to current customers or read online customer reviews to get a more well-rounded perspective about whether the bank may be ideal for you.
CIBC Bank has been involved in a recent public controversy. In 2021, CIBC agreed to pay $125 million in a settlement when accused of misrepresenting financial information regarding CIBC investments and US residential mortgage-backed securities.
from All Content from Business Insider https://www.businessinsider.com/personal-finance/best-18-month-cd-rates
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