CDs or Certificates of Deposit play an important role in earning the best interests and increasing our investments. You agree to place your money with a bank or credit union for a set amount of time, during which it will earn interest. At the end of the period, you get your money back plus a nice chunk of interest earnings. But, if you withdraw money from your CDs before the term expires or before the CD “matures,” in financial parlance — the institution will charge you a penalty fee for breaking the terms of your agreement. Generally, depositors think that when they invest the money it takes time for the CDs rates. But the accounts below are special CDs that let customers withdraw money from a CDs account with the no-penalty charge at whatever time they want.
No-penalty CDs aren’t generally widespread, but we’ve selected the best of these accounts available nationwide, based on the following criteria:
An APY of at least 1.80%
No penalties for early withdrawal of funds
Available across the nation
1. Marcus by Goldman Sachs®
Term
APY
Minimum balance to earn the APY
7-month
1.55%
$500
11-month
1.45%
$500
13-month
1.35%
$500
Marcus by Goldman Sachs stakes a strong claim to offering the best no-penalty CDs around, requiring a mere $500 deposit for customers to start earning solid APYs beginning at 1.55%. Interested customers should be aware, however, that like other-penalty CDs on this list, the accounts offered by this bank lock in your money for seven days after your deposit. You can’t open a 7-month no-penalty CD on Monday and take out your money on Wednesday (if you needed to for whatever reason).
2. CFG Bank
Term
APY
Minimum balance needed for APY
13 months
1.55%
$500
Headquartered in Baltimore, CFG Bank offers an array of financial products to consumers nationwide, both online and through its handful of branches across Maryland. It is the 12th-largest bank in Maryland, with over $1 million in assets.
The crown jewel of CFG Bank’s CD line-up is its 13-month CD, which you can open either online or at a branch. This CD is the bank’s only certificate of deposit that allows for a one-time, penalty-free withdrawal. There is a $500 minimum deposit for this product, which is also the amount that is required to earn its competitive APY of 1.55%. CFG Bank does not allow for additional deposits after the initial deposit, and all accounts face a seven days’ interest penalty if you make a withdrawal within six days of opening.
3. CIT Bank
Term
APY
Minimum balance to earn the APY
11-month
1.30%
$1,000
If you have the $1,000 minimum deposit for this no-penalty CD account, CIT Bank will give you a rate of 1.30% APY on an 11-month term. While that’s not as much as you can earn with a comparable CD term with some of the options above, the deal offered by CIT could provide a decent alternative.
4. Ally Bank
Term
APY
Minimum balance to earn the APY
11 months
1.30%
Up to $5,000
11 months
1.30%
$5,000
11 months
1.30%
$25,000
Online-only bank Ally offers a single no-penalty CD account with an 11-month term that earns more APY depending on how much you deposit. Because it has a low minimum balance requirement, this account will attract consumers without a lot of money to spare who still want a no-penalty CD. Higher balances can earn better APYs.
Similar to all of the other products listed, this Ally no-penalty CD account makes you wait for the seventh day after the initial deposit to withdraw your funds, and the bank doesn’t allow for partial withdrawals.
5. Citizens Access Liquid CD
Term
APY
Minimum balance to earn the APY
11 months
1.15%
$5,000
Another no-penalty CD hails from online-only bank Citizens Access. This bank is backed by Citizens Bank N.A., which has roots dating back 190 years and has over $150 billion in assets.
What are no-penalty CDs?
A no-penalty CD is a CD that usually doesn’t have a penalty if you break the term early. In general, early withdrawal isn’t allowed around the first week of funding or opening a no-penalty CD. But after that, you can usually make a penalty-free withdrawal.
It may be a good fit for people who aren’t sure when they’ll need access to their money but still want to earn a possible higher annual percentage yield (APY).
