Best 2 Year CD Rates for December 2024
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Secure your wealth with a 2-year CD. Discover top 24-month CD rates available today.
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- Always.bank:
4.45% APY - American First Credit Union:
3.75% APY
Looking to preserve capital for the next couple of years? A 2-year CD could provide a secure place to park your funds and grow it a little.
But note that there is the possibility of hefty early withdrawal penalties if you need to access your funds early.
Here are the top 2-year CD rates in the market to get you started.
PRO TIP: Currently, one of the highest rates on a 2-year CD is with Always.bank:
24-Month Callable CD - 4.45% APY
- $1 minimum deposit
- No fees
- 24/7 online access to funds
- FDIC insured
24-Month High-Yield CD - 3.75% APY
- $1 minimum deposit
- No fees
- 24/7 online access to funds
- Federally insured by NCUA
What is a 2-Year CD?
A 2-year (or 24-month) certificate of deposit is a savings account with a fixed rate that requires you to deposit a fixed amount of money for a period of 2 years. Typically, you earn a higher APY than with a regular savings account.
2-year CDs are quite common in the market, so you'll get many 2-year CD options to choose from.
How Much Interest Will a 2-Year CD Earn?
With $25,000 in a 2-year CD at 5% APY, you earn $2,563 when the CD matures. Here's a table showing how much you earn at different rates and deposit amounts:
| $10,000 | $25,000 | $50,000 | |
|---|---|---|---|
| 0.00% | $10,000 | $25,000 | $50,000 |
| 0.50% | $10,100 | $25,251 | $50,501 |
| 1.00% | $10,201 | $25,503 | $51,005 |
| 1.50% | $10,302 | $25,756 | $51,511 |
| 2.00% | $10,404 | $26,010 | $52,020 |
| 2.50% | $10,506 | $26,266 | $52,531 |
| 3.00% | $10,609 | $26,523 | $53,045 |
| 3.50% | $10,712 | $26,781 | $53,561 |
| 4.00% | $10,816 | $27,040 | $54,080 |
| 4.50% | $10,920 | $27,301 | $54,601 |
| 5.00% | $11,025 | $27,563 | $55,125 |
| 5.50% | $11,130 | $27,826 | $55,651 |
Use this CD calculator to see how much you can earn on a 2-year CD with other APY and amounts.
Is a 2-Year CD Worth It?
A 2-year CD is best if you already have money saved and don't need it for at least 2 years. It provides a safe place to park your funds and earn steady passive income.
It could be worth it if interest rates are expected to drop in near future. With a 2-year CD, you'd be able to secure a fixed high rate for a whole 2 years.
But note that rates may not be as high as shorter term CDs. However, if you're willing to give up some potential returns for security, it's worth considering.
Here are some of the top CD rates by term:
| Term | Bank and Yield Rate |
|---|---|
| 3 Month | Ponce Bank: |
| 6 Month | Western Alliance Bank: |
| 9 Month | Western Alliance Bank: |
| 1 Year | SkyOne Federal Credit Union: |
| 18 Month | SkyOne Federal Credit Union: |
| 2 Year | Always.bank: |
| 3 Year | mph.bank: |
| 4 Year | SkyOne Federal Credit Union: |
If you really need to, you can withdraw from a 2-year CD, but you'll face penalties for early withdrawal (usually several months' of interest). If you might need an early withdrawal, no-penalty CDs can be a good choice.
Can You Lose Money on a 2-Year CD?
In general, you will not lose money on 2-year CDs. Your deposits in CDs are federally insured by the FDIC or the NCUA for up to $250,000, so you're covered in case your bank or credit union closes down.
However, one way you can lose some money is if you withdraw your funds so early that your earnings can't cover the penalties.
Pros and Cons of a 2-Year CD
Pros
- Higher interest rates compared to savings accounts
Since you're tying up your money for two years, you usually get fixed, competitive rates that are higher compared to that of regular savings accounts. - Low-risk and guaranteed returns
Deposits in CDs are federally insured and the rate is fixed so your money and earnings are safe, guaranteed, and predictable. - Curb spending
2-year CDs work great if you want to stow away your money. You can't withdraw your CD without paying penalties, so it discourages you from using it.
24-Month Callable CD - 4.45% APY
- $1 minimum deposit
- No fees
- 24/7 online access to funds
- FDIC insured
Cons
- Limited liquidity
If you suddenly need to take out your money, 2-year CDs are not the best option because of the early withdrawal penalties. You may lose some or all of the interest your CD earned. - Missed opportunities for higher returns
CD rates can change quite often. If you get a 2-year CD and then rates go up, you would miss out on better offers. - Inflation
If the APY is too low, your earnings may not grow fast enough to match changes in the inflation rate.
High Yield Savings Account - 4.50% APY
- No fees
- $1 minimum deposit
- 24/7 online access
- FDIC insured
Yes because most financial institutions that offer 2-year CDs are members of the FDIC or NCUA. This means your deposits are covered in case your bank or credit union fails.
How to Find the Best 2-Year CD
If you've decided to get a 2-year CD, here are some things to ask before you commit to a specific offer.
What is the APY?
You should find the highest APY to maximize your interest earnings. Look at online banks and credit unions for the highest 2-year CD rates.
What is the minimum deposit requirement?
Some CDs have minimum deposit requirements, ranging from just $1 to $100,000 for Jumbo CDs. Choose a CD that fits your budget.
How much is the early withdrawal penalty?
A lot of things can happen within 2 years. To avoid paying high penalties, try to find a 2-year CD with low early withdrawal fees. You can also look for No-Penalty CDs, although these are quite rare.
Are there unique features?
A 2-year CD with convenient features, like the ability to bump your rate or add to your deposit, can give you more flexibility.
Alternatives to 2-Year CDs
If 2-year CDs may not be for you, here are other investments you can consider:
High-Yield Savings Account
Liquidity is a big issue with 2-year CDs. If you want flexibility with your money, look for online high-yield savings accounts with competitive rates.
- Western Alliance Bank:
High Yield Savings Account - 4.50% APY - Mission Valley Bank:
High Yield Savings Account - 4.50% APY - DR Bank:
High-Yield Savings Account - 4.40% APY - Dayspring Bank:
High-Yield Savings Account - 4.30% APY - Paprika Capital Bank:
High-Yield Savings Account - 4.29% APY - First Community Bank:
High-Yield Savings Account - 4.22% APY - The State Exchange Bank:
High Yield Savings Account - 4.20% APY - CFBank National Association:
High-Yield Savings Account - 4.20% APY - RBMAX:
High-Yield Savings Account - 3.66% APY - Customers Bank:
High-Yield Savings Account - 4.16% APY
No-Penalty CDs
If you're not sure about tying up your money, no-penalty CDs let you withdraw before the term ends with no early withdrawal fees. Think of it like a savings account with locked-in returns.
- Mission Valley Bank:
3-Month No-Penalty CD - 4.35% APY - SkyOne Federal Credit Union:
12-Month No-Penalty CD - 4.25% APY - Ponce Bank:
4 Month No-Penalty CD - 4.20% APY - Technology Credit Union:
5-Month No Penalty CD - 4.00% APY - Sallie Mae Bank:
14-Month No Penalty CD - 3.95% APY - Freedom Bank:
12-Month No-Penalty CD - 3.75% APY - Blue Federal Credit Union:
9-Month No Penalty CD - 3.75% APY - GreenState Credit Union:
12-Month No Penalty CD - 3.70% APY
Odd-Term CDs
Do you want higher rates? Some banks and credit unions offer promotional CDs with non-standard terms. These are CDs with terms like 13-months, 11-months, 5-months, etc. and usually they come with good rates.
Treasury Securities
Consider Treasury bills, notes, and bonds if you want fixed rates for a period of two years. These government-backed securities can offer a safe and reliable investment option similar to CDs.
Blue Chip Stocks
If you don't mind a bit of risk, try investing in blue chips. Blue chip stocks are shares in established, renowned companies with a strong growth record and often pay good dividends. You can also easily sell and withdraw if needed.
2-Year CD FAQs
Where can I get a 2-year CD?
2-year CDs are often available at banks and credit unions. You can visit a nearby branch or their official website to see what CDs and rates are being offered. You can usually open an account either online or at a physical location as well.
When should I get a 2-year CD?
Generally, it's best to get a CD when interest rates are at their peak. CD rates usually move with the Fed Funds rate and the Treasury Yield. By monitoring these trends, you can determine the best time for you to invest in a 2-year CD.
Is a 2-year CD better than a savings account?
If you need easy access to your money, choose a savings account. If not, consider a 2-year CD to lock in potentially higher rates. Both are FDIC-insured, as long as your bank or credit union is an FDIC or NCUA member.
Bottom Line
Making a two-year commitment is a major decision, but if you're looking to stow away your savings for a while, a 2-year CD might be a good choice. Check out Always.bank:
If it fits well with your financial plans, then a 2-year CD may be worth your while. Otherwise, consider other savings accounts and investments.
24-Month Callable CD - 4.45% APY
- $1 minimum deposit
- No fees
- 24/7 online access to funds
- FDIC insured
24-Month High-Yield CD - 3.75% APY
- $1 minimum deposit
- No fees
- 24/7 online access to funds
- Federally insured by NCUA
Write to Rue Atanacio at feedback@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.
Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.
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