Best IRA CD Rates in August 2024

An individual retirement account (IRA) CD is a type of retirement account that invests your funds in a certificate of deposit (CD). When you open a regular CD, you're putting away money for the near future. With an IRA CD, it's part of your long-term retirement savings strategy. The type of IRA you use for your IRA CD determines guidelines for contributions and tax implications on withdrawals.

Below is our list of banks and credit unions where you can find the best IRA CD rates available right now. We've included annual percentage yield (APY) ranges for an overall look at the rates you can earn through each institution. APYs often vary among different CD terms. We chose the banks and credit unions that consistently offered the highest across most CD terms. At a credit union, a CD is called a share certificate, but it works in essentially the same way. For simplicity, this article calls them all CDs.

America First Credit Union IRA CD

America First Credit Union IRA CD

APY range

4.20% to 5.50%

Min. deposit

$500

Term options

Three months to five years

Why we like it:

Members of Utah-based America First Credit Union can open IRA CDs ranging from three months to five years. A $500 minimum balance is required to open an IRA CD through America First. All of its IRA CD terms offer rates above 4.00% APY, with some topping 5.00% APY. Its three-to-five–month IRA CD ties with Suncoast's 12-month IRA CD in offering the highest rate on our list at 5.50% APY.

Membership is open to individuals who live, work, worship, volunteer, or attend school in select areas in Utah, Nevada, Arizona, Idaho, Oregon, and New Mexico. It's also open to immediate family and household members of an existing member and other individuals with a qualifying affiliation.

Suncoast Credit Union IRA CD

Suncoast Credit Union IRA CD

APY range

3.85% to 5.50%

Min. deposit

$500; $100,000 for jumbo certificates

Term options

Six months to five years

Why we like it:

Suncoast Credit Union offers IRA CDs and jumbo IRA CDs. You can open an IRA CD through the credit union with a $500 minimum balance, while jumbo IRA CDs require $100,000. They are available for traditional, Roth and SEP IRAs and range from six months to five years. CD dividends are compounded daily and credited monthly. Suncoast's 12-month IRA CD ties with America First Credit Union’s three-to-five–month IRA CD in offering the highest rate on our list at 5.50% APY.

Suncoast Credit Union membership is open to individuals who live, work, attend school, or worship in the Florida counties where Suncoast operates.

Alliant Credit Union IRA CD

Alliant Credit Union IRA CD

APY range

4.00% to 5.45%

Min. deposit

$1,000; $75,000 for jumbo certificate

Term options

One year to five years

Why we like it:

Alliant Credit Union IRA certificates offer high yield rates on eight CD terms ranging from one to five years. IRA CDs have a $1,000 minimum opening balance requirement, while jumbo IRA CDs require a minimum of $75,000 to open. They're available for traditional, Roth and SEP IRAs opened through Alliant.

Membership is relatively open with Alliant. If you don't qualify for membership through one of its traditional paths, you can qualify by becoming a member of the Foster Care to Success (FC2S) program. Alliant even covers the one-time $5 FC2S membership fee for you.

NASA Federal Credit Union IRA CD

NASA Federal Credit Union IRA CD

APY range

4.00% to 5.30%

Min. deposit

$50, $250, $1,000, or $10,000 depending on the certificate

Term options

Six months to five years

Why we like it:

Nasa Federal Credit Union offers 13 IRA CDs in term lengths ranging from six months to five years. Mixed with its regular IRA CDs are a few alternative options, including bump rate and add-on IRA CDs and early saver IRA CDs for individuals 23 and under. CDs are available for traditional and Roth IRAs.

Something to keep in mind is that the minimum opening balance required to open an IRA CD through NASA Federal Credit Union varies depending on the term or IRA CD type chosen. An Early Saver CD only requires a $50 minimum opening balance, but other IRA CDs require anywhere from $250 to $10,000 to open.

You must become a NASA Federal Credit Union member to open an IRA CD account. You can qualify for membership through an eligible association with NASA, the National Academy of Sciences (NAS), NASA Federal Credit Union partner companies or associations, or by being a relative or household member of a current NASA Federal Credit Union member. If none apply, the credit union provides a complimentary one-year affiliated membership to the National Space Society (NSS) so you qualify.

Synchrony Bank IRA CD

Synchrony Bank IRA CD

APY range

1.90% to 5.15%

Min. deposit

None

Term options

Three months to five years

Why we like it:

Synchrony Bank offers IRA CDs which work with traditional or Roth IRA accounts. The online bank has IRA CDs ranging from as short as three months to as long as five years. Unlike many institutions, there's no minimum balance required to open a Synchrony IRA CD.

Interest on Synchrony IRA CDs compounds daily and is credited monthly. IRA CDs automatically renew after a 10-day grace period. In addition to IRA CDs, Synchrony is one of the rare banks that offer an IRA money market account.

Discover IRA CD

Discover IRA CD

APY range

2.00% to 4.80%

Min. deposit

$2,500

Term options

Three months to 10 years

Why we like it:

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Discover is home to high yield IRA CDs for traditional and Roth IRAs. You'll need a $2,500 minimum balance to open a CD through the online bank.

Discover is one of the few banks to offer CD terms longer than five years, as it has both a seven- and 10-year option.

Ally IRA CD

Ally IRA CD

APY range

3.00% to 4.50%

Min. deposit

None

Term options

Three months to five years

Why we like it:

Ally is one of the top online banks, thanks to its customer-friendly accounts and competitive rates on several deposit products. The online bank also offers IRA Raise Your Rate CDs in two- and four-year terms.

You can open an Ally IRA CD with any deposit amount. CDs are available for Roth, SEP, and traditional IRAs.

Best IRA CD rates today

*Rates as of March 7 (March 1 for NASA Federal Credit Union), 2024

Methodology

We chose the best IRA CD rates based on which financial institutions currently offered the highest APY ranges. Other determining factors included minimum deposit requirements and the range of terms offered. We only included banks and credit unions that insure deposits through the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

Pros and cons of investing in an IRA CD

Who is an IRA CD best for?

An IRA CD is best for individuals nearing retirement age who are looking for a safe pathway to saving for retirement. If you're retiring in the next 10 years, an IRA CD may offer more peace of mind than the volatility of the stock market. IRA CDs are also an excellent option for those who want to diversify their portfolio with low-risk accounts with guaranteed returns.

IRA CDs are probably not the best option for young professionals starting their careers. These individuals likely will have more time to recover from market fluctuations with aggressive, higher-risk investments and will earn more from them overall due to periods when markets are high.

Is an IRA CD tax deductible?

An IRA CD itself isn't directly tax deductible, but the money you contribute to your IRA could be, depending on the type of IRA. If you have a Roth IRA, you can't deduct the funds deposited into the account for the year from your income, but you can for traditional IRAs.

The type of IRA also determines whether you'll pay taxes on withdrawals later. You won't pay taxes on qualified Roth IRA withdrawals but will on distributions taken from a traditional IRA.

Alternatives to IRA CDs

IRA CDs may not be the best investment option for everyone. If you're not sure if they're right for you, consider the following alternatives to IRA CDs.

• Investment assets. IRAs can hold a variety of asset types, including stocks, bonds, mutual funds, exchange-traded funds (ETFs), and target-date funds.
• CDs. CDs work the same way IRA CDs do, but they exist outside of your IRA and offer a little more flexibility when they reach maturity.
• High yield savings accounts. Typically available through online banks, high yield savings accounts offer competitive APYs that sometimes rival the best CD rates, often with no monthly service fees.
• Money market accounts. These hybrid bank accounts offer the savings power of a high yield savings account with the convenience of a checking account. Money market accounts sometimes require keeping a higher balance to earn top-tier rates.

TIME Stamped: A good investment option for fast growing and stable savings

IRA CDs could be a good investment option if you're nearing retirement and want added financial protection without much hassle. Your money may not grow as fast as with other investment options, but the best IRA CD rates can help build your savings while providing stability. Consider your financial situation and timeline for retirement, and choose investment and savings options that best fit your needs.

Frequently asked questions (FAQs)

Are CDs and IRA CDs the same?

A regular CD is a timed deposit account held at a bank or credit union. It comes with a fixed APY and predetermined term length for guaranteed, predictable returns. After a CD matures, you have the option to withdraw your funds, renew the CD at the current interest rate, or reinvest the funds in a new CD.

An IRA CD works like a regular CD except that it is held within an IRA and meant for retirement savings. You can't withdraw funds from a traditional IRA—or earnings from a Roth IRA— before age 59½ without paying a penalty.

Can I buy a CD in my IRA account?

Yes, many banks offer IRA CDs (or share certificates for credit unions), which are held in your IRA.

What happens when a CD matures in an IRA?

When an IRA CD matures you can do one of three things: renew it, add funds to it, or withdraw funds (without penalty if you are of retirement age) and do what you will with them. This might include opening a new CD or putting the funds into another existing CD.