12 month CDs (Certificates of Deposit)
A 12 month CD, also known as a 1 year CD, is the most popular FDIC insured deposit product. The length of the term is short enough to keep your funds relatively accessible, but long enough to help you earn interest on your investment.
In the past, CDs have provided a higher rate of interest than they currently do. However, these are still fundamental cornerstones of healthy portfolios.
While there is nothing wrong with keeping some cash liquid, the ability to tie up other money in a 12 month CD is beneficial for a variety of reasons. With a 1 year bank CD, you are able to hedge against the loss of your dollar’s buying power despite the fact that interest rates are lower than in the past.
Compare 12 Month CD Rates
It is one thing to say you are interested in a 12 month CD, but another thing entirely to find the product that is best for you, your money, and your financial goals.
Once you decide that you are interested in a 1 year CD, there are several routes you can take.
First and foremost, you can speak with your current bank about the products they offer. By doing this, you are taking a lot of the guesswork out of the process. You are already comfortable with the financial institution, so this will give you the confidence to move forward.
On the downside, your bank may not offer the most competitive interest rate.
Your other option is to shop around for a 12 month CD with the highest rate. By taking a few minutes to browse the internet, you will soon find which products offer the highest rates for this type of CD.
If you currently bank with a small local bank or credit union, check with them first as smaller institutions often provide CD rates that are higher than current national averages. If you bank with a large institution, such as Bank of America, Chase, CitiBank, Wells Fargo or the like, you will most likely have to opt for a lower rate.
Points of Comparison
While there is no denying the importance of comparing interest rates, there are other details to consider along the way. These include but are not limited to the following:
- Process for investing in a 12 month CD
- Minimum deposit
- Is interest compounded daily or monthly?
- Fees, including those for early withdrawal
- What happens to the CD upon maturity?
In our 12 month CD rate search engine above, we collect the rates of hundreds of banks from around the country (including the large national ones) and display the top APY’s for consumers who are in the market for these products. The top 12 month CD rate from our database today will always beat the national average by a significant margin. All the institutions listed in our database are member FDIC, therefore your 12 month deposit will be federally insured up to $250,000.