If you’re willing to set aside your extra money for a year and a half, you can still earn a high annual percentage yield, or APY, with an 18-month certificate of deposit. However, rates have been dropping for weeks across different CD terms. So, now’s the time to act if you’ve been thinking about opening an 18-month CD.
Interest rates on deposit accounts, including CDs, remain high even though the Federal Reserve chose to hold rate steady at its last four meetings. However, experts believe these rates are as high as they’re going to get. Opening a CD now will allow you to secure a high rate while rates remain elevated and protect your earnings from future rate drops.
What is an 18-month CD?
An 18-month CD is a deposit account that lets you earn a fixed return on your savings in exchange for locking up your money for a year and a half. Some banks and credit unions offer it as a low-risk savings account option, insured by either the Federal Deposit Insurance Corp. or National Credit Union Administration for up to $250,000 per person, per institution in case of a bank failure.
Like with other CD terms, you’ll make a one-time deposit. And once the 18 months are up, you can access the funds free of charge. But if you need the money before the term ends, you’ll pay an early withdrawal penalty, which is usually a few months’ worth of interest.
CNET’s picks for the best 18-month CD rates
| Bank | APY | Min. deposit to open |
|---|---|---|
| Alliant Credit Union | 5.15% | $1,000 |
| CommunityWide Federal Credit Union | 5.00% | $1,000 |
| Barclays | 4.50% | $0 |
| Synchrony Bank | 4.50% | $0 |
| Marcus by Goldman Sachs | 4.80% | $500 |
| Ally Bank | 4.45% | $0 |
| CFG Bank | 4.95% | $500 |
| Capital One Bank | 4.70% | $0 |
Alliant Credit Union
- APY APY = Annual Percentage Yield.
- 5.15%
- Min. deposit to open
- $1,000
- CDs offered: High-yield and jumbo CDs
- IRA CDs are also available for retirement
- Terms range from three months to five years
- Early withdrawal penalties range from seven days to three months of interest
About the bank: Alliant provides different types of checking and savings accounts -- including options for teens and kids. We like that the credit union lets you open as many as 19 savings accounts and tracks your financial goals online. And you’ll get up to $20 reimbursed for out-of-network ATM surcharges.
However, you’ll need to meet certain eligibility requirements to open an account, but it’s still available nationwide. You can open an account online or by calling 800-328-1935.
- CDs offered: High-yield and jumbo CDs
- IRA CDs are also available for retirement
- Terms range from three months to five years
- Early withdrawal penalties range from seven days to three months of interest
About the bank: Alliant provides different types of checking and savings accounts -- including options for teens and kids. We like that the credit union lets you open as many as 19 savings accounts and tracks your financial goals online. And you’ll get up to $20 reimbursed for out-of-network ATM surcharges.
However, you’ll need to meet certain eligibility requirements to open an account, but it’s still available nationwide. You can open an account online or by calling 800-328-1935.
CommunityWide Federal Credit Union
- APY APY = Annual Percentage Yield.
- 5.00%
- Min. deposit to open
- $1,000
- CDs offered: Only high-yield CDs
- Terms range from six months to five years
- Requires a $1000 minimum deposit and a $4.95 processing fee
- Certificates do not automatically renew
- CommunityWide may match better rates
About the bank: CommunityWide Federal Credit Union offers high-yield share certificates ranging from six months to five years. There’s a minimum deposit of $1,000 to get started. Your share certificate won’t automatically roll into a new share certificate after it matures. Your interest is credited monthly and can be paid into your share certificate or rolled into the bank account of your choosing.
And if you find a better rate somewhere else, CommunityWide will try to match the other rate.
You’ll need to meet eligibility requirements to open an account and when you do, a one-time $4.95 processing fee will be charged to open a debit card.
- CDs offered: Only high-yield CDs
- Terms range from six months to five years
- Requires a $1000 minimum deposit and a $4.95 processing fee
- Certificates do not automatically renew
- CommunityWide may match better rates
About the bank: CommunityWide Federal Credit Union offers high-yield share certificates ranging from six months to five years. There’s a minimum deposit of $1,000 to get started. Your share certificate won’t automatically roll into a new share certificate after it matures. Your interest is credited monthly and can be paid into your share certificate or rolled into the bank account of your choosing.
And if you find a better rate somewhere else, CommunityWide will try to match the other rate.
You’ll need to meet eligibility requirements to open an account and when you do, a one-time $4.95 processing fee will be charged to open a debit card.
Barclays
- APY APY = Annual Percentage Yield.
- 4.50%
- Min. deposit to open
- $0
- CDs offered: Only high-yield CDs are available
- Terms range from one to five years
- No monthly maintenance fees
- Early withdrawal penalties range from three to six months of interest -- depending on the CD term
About the bank: Barclays Bank is a good choice for high-yield savings accounts and CDs, but you won’t find any other options -- such as checking or money market accounts. However, you can manage your accounts online or via the mobile app. We also like that Barclays offers a few helpful tools to help you manage your money and track savings goals, including the Savings Assistant and CD calculator.
Barclays’ customer service is available seven days a week, but its hours are limited to 8 a.m. to 8 p.m. ET. -- there’s no 24/7 customer service line.
- CDs offered: Only high-yield CDs are available
- Terms range from one to five years
- No monthly maintenance fees
- Early withdrawal penalties range from three to six months of interest -- depending on the CD term
About the bank: Barclays Bank is a good choice for high-yield savings accounts and CDs, but you won’t find any other options -- such as checking or money market accounts. However, you can manage your accounts online or via the mobile app. We also like that Barclays offers a few helpful tools to help you manage your money and track savings goals, including the Savings Assistant and CD calculator.
Barclays’ customer service is available seven days a week, but its hours are limited to 8 a.m. to 8 p.m. ET. -- there’s no 24/7 customer service line.
Synchrony Bank
- APY APY = Annual Percentage Yield.
- 4.50%
- Min. deposit to open
- $0
- CDs offered: High-yield and jumbo CDs
- IRA CDs are also available for retirement
- Terms range from three months to five years
- Early withdrawal penalties range from seven days to three months of interest
About the bank: Alliant provides different types of checking and savings accounts -- including options for teens and kids. We like that the credit union lets you open as many as 19 savings accounts and tracks your financial goals online. And you’ll get up to $20 reimbursed for out-of-network ATM surcharges.
However, you’ll need to meet certain eligibility requirements to open an account, but it’s still available nationwide. You can open an account online or by calling 800-328-1935.
- CDs offered: High-yield and jumbo CDs
- IRA CDs are also available for retirement
- Terms range from three months to five years
- Early withdrawal penalties range from seven days to three months of interest
About the bank: Alliant provides different types of checking and savings accounts -- including options for teens and kids. We like that the credit union lets you open as many as 19 savings accounts and tracks your financial goals online. And you’ll get up to $20 reimbursed for out-of-network ATM surcharges.
However, you’ll need to meet certain eligibility requirements to open an account, but it’s still available nationwide. You can open an account online or by calling 800-328-1935.
Marcus by Goldman Sachs
- APY APY = Annual Percentage Yield.
- 4.80%
- Min. deposit to open
- $500
- CDs offered: High-yield, no-penalty and bump-up CDs
- Terms range from six months to six years -- depending on the type of CD
- Early withdrawal penalties range from three to nine months of interest
- You can modify your CD 12 months before it matures with the CD Maturity Center -- including withdrawing money or closing the account
About the bank: Marcus by Goldman Sachs offers a variety of CDs, but doesn’t provide a checking account, making it less than ideal to move all of your money to this bank. We like that its high-yield CDs require a small $500 minimum deposit, while its other savings accounts don’t require any amount to get started. We also like that you can make same-day transfers of $100,000 or less to and from other banks. And you can reach the contact center 24/7 by calling 855-730-7283. An extensive list of frequently asked questions is also available online.
However, there are some shortcomings. In addition to not offering a checking account, Marcus by Goldman Sachs also doesn’t come with an ATM network and doesn’t offer money market accounts. Lastly, you won’t be able to deposit cash or mobile check deposits.
- CDs offered: High-yield, no-penalty and bump-up CDs
- Terms range from six months to six years -- depending on the type of CD
- Early withdrawal penalties range from three to nine months of interest
- You can modify your CD 12 months before it matures with the CD Maturity Center -- including withdrawing money or closing the account
About the bank: Marcus by Goldman Sachs offers a variety of CDs, but doesn’t provide a checking account, making it less than ideal to move all of your money to this bank. We like that its high-yield CDs require a small $500 minimum deposit, while its other savings accounts don’t require any amount to get started. We also like that you can make same-day transfers of $100,000 or less to and from other banks. And you can reach the contact center 24/7 by calling 855-730-7283. An extensive list of frequently asked questions is also available online.
However, there are some shortcomings. In addition to not offering a checking account, Marcus by Goldman Sachs also doesn’t come with an ATM network and doesn’t offer money market accounts. Lastly, you won’t be able to deposit cash or mobile check deposits.
- APY APY = Annual Percentage Yield.
- 4.45%
- Min. deposit to open
- $0
- CDs offered: No-penalty, bump-up and high-yield CDs
- Terms range from three months to five years -- depending on the type of CD
- Early withdrawal penalties range from two to five months of interest
- Earn a 0.05% Loyalty Reward when you renew your CD
About the bank: Ally is one of our favorite banks and a top choice when it comes to opening a CD. It’s a full-service bank with several deposit accounts, including high-yield checking, savings and money market accounts. None of these accounts require a minimum deposit or balance -- and if you’re eyeing a CD with Ally, we like that it offers a loyalty reward that boosts your APY by 0.05% when you renew your term.
Keep in mind, Ally is an online-only bank, so you’ll need to be comfortable managing your account online. ATMs are available nationwide, but cash deposits aren’t accepted.
- CDs offered: No-penalty, bump-up and high-yield CDs
- Terms range from three months to five years -- depending on the type of CD
- Early withdrawal penalties range from two to five months of interest
- Earn a 0.05% Loyalty Reward when you renew your CD
About the bank: Ally is one of our favorite banks and a top choice when it comes to opening a CD. It’s a full-service bank with several deposit accounts, including high-yield checking, savings and money market accounts. None of these accounts require a minimum deposit or balance -- and if you’re eyeing a CD with Ally, we like that it offers a loyalty reward that boosts your APY by 0.05% when you renew your term.
Keep in mind, Ally is an online-only bank, so you’ll need to be comfortable managing your account online. ATMs are available nationwide, but cash deposits aren’t accepted.
CFG Bank
- APY APY = Annual Percentage Yield.
- 4.95%
- Min. deposit to open
- $500
- CDs offered: Only high-yield CDs
- Terms range from one to five years
- Requires a $500 minimum deposit
- The maximum CD deposit is $500,000
- Subject to a seven-day interest penalty if a withdrawal occurs within six days of account opening
About the bank: CFG Bank offers competitive rates for money market accounts, CDs and savings accounts. Several checking accounts are also available, with access to over 2,000 ATMs. CFG also charges a few more fees than other banks, such as a $25 overdraft fee and a monthly maintenance fee between $2 and $10 (depending on the account).
Branches are available in Maryland -- which can be a downside if you need in-person help and are not nearby. However, you can manage your account online, via the mobile app or by phone at 410-823-0500.
- CDs offered: Only high-yield CDs
- Terms range from one to five years
- Requires a $500 minimum deposit
- The maximum CD deposit is $500,000
- Subject to a seven-day interest penalty if a withdrawal occurs within six days of account opening
About the bank: CFG Bank offers competitive rates for money market accounts, CDs and savings accounts. Several checking accounts are also available, with access to over 2,000 ATMs. CFG also charges a few more fees than other banks, such as a $25 overdraft fee and a monthly maintenance fee between $2 and $10 (depending on the account).
Branches are available in Maryland -- which can be a downside if you need in-person help and are not nearby. However, you can manage your account online, via the mobile app or by phone at 410-823-0500.
Capital One Bank
- APY APY = Annual Percentage Yield.
- 4.70%
- Min. deposit to open
- $0
- CDs offered: Only high-yield CDs are available
- Terms range from six months to five years
- CDs cannot exceed $1,000,000
- Early withdrawal penalties range from three to six months of interest
About the bank: Capital One offers traditional CDs with terms ranging from six months to five years. No minimum deposit is required to open an account, and you can open an account in person at a physical branch or online. You can also determine when your CD interest is paid to you -- whether monthly, annually or at the end of the term.
- CDs offered: Only high-yield CDs are available
- Terms range from six months to five years
- CDs cannot exceed $1,000,000
- Early withdrawal penalties range from three to six months of interest
About the bank: Capital One offers traditional CDs with terms ranging from six months to five years. No minimum deposit is required to open an account, and you can open an account in person at a physical branch or online. You can also determine when your CD interest is paid to you -- whether monthly, annually or at the end of the term.
How to get the best 18-month CD
Before you open an 18-month CD, compare rates and requirements to see which CD is best for you and your savings goals. Online banks generally offer the most competitive interest rates because they don’t have the same overhead costs as brick-and-mortar banks.
It’s also important to look beyond the rate when comparing CDs. If you prefer banking in person, find a bank or credit union in your area that provides the accessibility you need. If you’re comfortable managing your account online, review an online bank’s customer service options and hours of operation should you need to speak with a representative.
You should also watch out for fees. Although most of the banks with high CD rates don’t charge monthly maintenance fees, some might require a minimum deposit. Make sure you know the bank’s early withdrawal penalty, too, in case you do need to pull your funds out sooner.
Should I choose an 18-month CD?
Although an 18-month CD is considered a long-term CD because it requires you to lock up your funds for more than a year, this term offers competitive yields and a relatively brief term compared with other long-term CD options.
The average annual percentage yield for an 18-month CD is 4.65%, based on the banks we track at CNET. One-year CDs right now offer on average 5.06% APY, which is a higher rate on a shorter term. If you’re worried you might be tempted to spend your savings before you need it, a longer-term CD -- such as 18 months or two years -- may be more suitable.
If, however, there’s a chance you’ll need the money sooner, shorter-term CDs also offer high rates. Six-month and nine-month CDs currently average 4.89% and 4.91%, respectively. You should consider your savings timeline and whether your savings goal requires more liquidity before committing to an 18-month CD. Most experts agree that high-yield savings accounts are the better choice should you need easier access to your funds.
You should consider your savings timeline and whether your savings goal requires more liquidity before committing to an 18-month CD. Most experts agree that high-yield savings accounts are the better choice should you need easier access to your funds.
“The flexibility that comes with an HYSA cannot be understated,” said Jeff Rose, a certified financial planner. “It allows consumers to access their funds without the constraints of a term commitment, which can be particularly beneficial in a time of financial uncertainty or if better investment opportunities arise.”
The biggest advantage of an 18-month CD over a savings account is you can lock in your interest rate. If rates drop months from now, yours will remain the same. The disadvantage is if there’s a chance you’ll need the money before the term is up, you’ll pay an early withdrawal penalty that may not make it worthwhile.
But with the uncertainty of where rates will head in the next year and a half, locking in a high rate now might be worth it, according to Lawrence D. Sprung, a certified financial planner and founder of Mitlin Financial.
How to open an 18-month CD
Once you’re ready to open a CD, you can open the account in person or online, depending on the bank. You’ll need to fill out an application with basic personal information, such as your full name, mailing address, Social Security number (or Individual Taxpayer Identification number) and email.
After you complete the application, you’ll need to make a one-time deposit to fund the CD. The minimum deposit will vary depending on the bank and can be anywhere from less than $100 to over $1,000. Most CDs won’t allow you to make additional contributions after your initial deposit, so be prepared to make your deposit in full upon opening the account.
Alternatives to an 18-month CD
If you don’t want to lock your money up for a year and a half with a CD, it may be worth considering other options.
High-yield savings accounts
If you need more flexibility to withdraw and deposit funds over time, consider a high-yield savings or money market account. Just keep in mind that savings and money market accounts have variable rates, while an 18-month CD has a fixed rate. If rates drop, there’s a good chance your savings rate will too. Since most 18-month CDs have a higher APY than savings accounts and MMAs right now, locking in a CD might help you earn a bigger return. But we still recommend storing your emergency savings and other funds you may need quickly in a savings account or MMA -- even if rates start to dip.
Short-term CDs
Depending on your timeline, you may choose a shorter CD term with a higher rate. Right now, six- and nine-month CDs have average APYs that are close to 18-month CDs but give you access to your money sooner. Just keep in mind that a short-term CD (less than one year) will earn less than the full APY.
CD ladders
You can also build a CD ladder to incorporate several CD term lengths with multiple accounts. This way, you can spread your deposit across several terms and have access to some of your money sooner instead of locking all your funds into one CD term.
Bonds
You may also consider bonds, such as an I bond, if you don’t need the money for several years. The current I bond rate is 5.27% until April 30, 2024 -- which is right on par with most 18-month CDs. But I bonds have a variable rate, which fluctuates with inflation. So as inflation goes down, there’s a chance your variable rate could be close to zero. And if you need the money before five years, you’ll forgo the previous three months of interest.
FAQs
Fees and withdrawal penalties vary depending on the bank. Most CDs charge a withdrawal penalty for taking money out of your CD before the term ends. For example, you may forfeit 180 days (or six months) of interest earned on an 18-month CD if you withdraw the money before the term ends.
Unless you buy a CD offered by a brokerage account, CDs purchased through a FDIC-insured bank or NCUA-insured credit union are insured for up to $250,000 per person, per account. Any compound interest is also covered by the insurance, making it a low-risk investment.
However, fees and early withdrawal penalties can reduce your expected return on your CD -- and possibly your deposit. That’s why it’s important to ensure you can leave your CD funds untouched for the duration of the term.
When you open a CD, your rate is fixed for the entire term, meaning it won’t go up or down at any point (unless you have a bump-up or step-up CD).
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Methodology
CNET reviews CD rates based on the latest APY information from issuer websites. We evaluated CD rates from more than 50 banks, credit unions and financial companies. We selected the CDs with the highest APY for 18-month terms from among the organizations we surveyed.
The banks, credit unions and neobanks we reviewed include: Alliant Credit Union, Ally, American Express National Bank, Bank of America, Barclays, Bask Bank, Bethpage, BMO Harris, Capital One, Chase, CFG Bank, CIT Bank, CIBC Bank, CFG Bank, CIT Bank, CommunityWide Federal Credit Union, Discover, EverBank, First Internet Bank of Indiana, Limelight Bank, Marcus by Goldman Sachs and Synchrony.
The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.
