bank rates

Little Joy In 1-Year CD Rates This Holiday

If you bought a top-paying 12-month CD just before Thanksgiving 2009, you could have earned as much as 2.60% APY over the past year.

Renew that CD as this holiday season approaches and you’ll be lucky to make 1.4% APY to 1.5% APY.
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But that’s still two to three times what you can make with the average rate on 12-month CDs, which fell to a record low of 0.51% APY yesterday.

That’s why you’ve got to take a good hard look at our rankings of the best nationally available returns on 1-year certificates of deposit.

In dollars and cents terms, you can earn an additional $10 over the course of the next year for every $1,000 you invest if you refuse to settle for an average rate and choose one of these top-paying CDs.

Our current leaders are:

Melrose Credit Union, which has a single office in New York and is paying 1.51% APY with a $5,000 minimum deposit.

Bank of Internet, an online bank based in San Diego that’s paying 1.41% APY with a minimum deposit of $1,000.

Ascencia, an online division of PBI Bank in Louisville, Ky., which is paying 1.40% APY with a $500 minimum deposit.

Colorado Federal Savings Bank, an online bank located in Greenwood Village, Colo., which is paying 1.35% APY with a $5,000 minimum.

Discover Bank, an online bank owned by the credit card company, which is also paying 1.35% APY with a $2,500 minimum deposit.

These banks and credit unions qualify for our rankings by imposing no restrictions on who can buy their CDs.

Melrose is one of the few credit unions in our rankings because its unique charter allows anyone to join for only $1, regardless of where they live or work. (You will also be required to hold at least $25 in a savings account.)

We use Bankrate’s weekly survey of major banks and thrifts to track the average return on CDs. So when we say they’ve reached a record low, we mean it’s the lowest since Bankrate began tracking 12-month CD rates in October 1983.

Click here to compare these returns with the best CD rates from scores of other banks in our database.

You can calculate exactly how much you’ll make on any investment, at any rate for any term with our CD calculator.

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