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We assessed 5-year certificate of deposit options provided by the biggest banks and credit unions across the country to determine the best choices, ultimately only featuring those that fit our strict criteria. To be eligible, a bank or credit union had to:
- Fall among the top 30 banks and top 10 credit unions based on 2022 consolidated assets.
- Be federally insured by either the FDIC or the NCUA.
- Offer CDs in all 50 states.
Annuity.org’s independent editorial staff evaluated 5-year certificate of deposit options from the country’s biggest banks and credit unions to determine the best rates in 2023.
They evaluated products from the 30 largest banks and 10 largest credit unions based on consolidated assets according to the U.S. Federal Reserve or National Credit Union Administration to determine which companies qualified for their rankings.
To be eligible, a bank or credit union had to provide 5-year CDs in all 50 states and be insured by either the FDIC or the NCUA. This resulted in 19 banks and credit unions, of which only 12 offered 5-year terms.
The staff only chose CDs offering more than 3.00% APY on 5-year CDs for their final comparisons, narrowing the list to just seven institutions.
The final choices were made based on APY, minimum deposit requirements, early withdrawal penalties and any bonuses or promotions offered by the institutions.
Learn more about our broader Editorial Guidelines.
Editors Choice: Best Overall
BMO Bank Details
Founded in 1847, BMO was established under its current charter in 2011 and is headquartered in Chicago. It has branches in the Midwest, Florida and Arizona, but serves customers nationwide. It had $176.9 billion in consolidated assets in 2022, according to the U.S. Federal Reserve.
- Competitive APY
- Nationwide online banking access
- Wide range of other CD term options
- High early withdrawal penalty
- High minimum deposit requirement ($1,000)
Best for Small Depositors
Ally Bank Details
Founded in 1919 as GMAC — the dealer financing arm of General Motors — Ally Bank was rebranded in 2009. Ally is an online-only bank and has no physical branches. It reported 4 million retail customers in 2016 and $181.8 billion in assets in 2022, according to the U.S. Federal Reserve.
- High APY
- No minimum deposit
- Maximum 150 days’ interest for early withdrawal fees
- Lack of physical branches
Best From a Credit Union
Alliant Credit Union Details
One of the largest credit unions in the United States, Alliant was founded in Chicago in 1935 as the United Airlines Employees’ Credit Union. It changed its name in 2003 and diversified its membership. It now serves 700,000 members and has $17 billion in assets, according to its corporate website.
- Competitive rates
- Early withdrawal penalty is limited to 180 days’ interest maximum
- $1,000 minimum deposit requirement
- Must have an active savings or trust account with Alliant to open
- Limited physical branches
Best for Military Members and Their Families
Navy Federal Credit Union Details
Navy Federal has 12.3 million members and 350 branches globally. Membership is limited to military members, their families or household members, veterans and U.S. Department of Defense personnel. It had $156 billion in assets in 2022, according to the U.S. Federal Reserve.
- High APY is competitive with online banks
- Branches and ATMs near military installations
- Membership is limited to family or household members of current or former military
- Hefty $1,000 minimum deposit requirement
- Early withdrawal penalty
Others We Considered
Among the other institutions Annuity.org considered — with APYs of 3.00% or higher — there were some competitive choices among rates and minimum deposits.
- Capital One
- Capital One offered a competitive APY with no minimum balance at the time of consideration. Its early withdrawal penalty was six months’ interest, making it the best of our secondary choices.
- Discover Bank
- This online bank offered a competitive rate with a high $2,500 minimum deposit. But it also had a withdrawal penalty of nine months’ simple interest.
- Marcus (Goldman Sachs)
- This Goldman Sachs online bank offered a 5-year CD with just a moderate APY and a $500 minimum deposit at the time of our rankings. The early withdrawal penalty was nine months’ interest.
- American Express Bank
- American Express Bank offered a modest APY 5-year CD with no minimum deposit. Unfortunately, the minimum withdrawal penalty was equal to 356 days of interest.
Other Top-Rated 5-Year CD Rates
Typically, online-only institutions or regional or community banks and credit unions with robust online presence had the highest overall rates.
Four other large commercial banks on our list were not considered because their advertised 5-year CD rates fell below our 3.00% APY threshold. These included Citibank, JPMorgan Chase and U.S. Bank.
What Makes 5-Year CDs Different From Other CDs?
The biggest differences between 5-year CDs and other terms are the amount of interest you may be able to earn and the amount of commitment you have to have.
Typically, longer-term certificates of deposit — such as 5-year CDs — offer higher rates. This is not always the case, especially, when economic forces cause a partial inversion of the U.S. Treasury curve, which we are currently experiencing. In any economic environment, make sure to compare different terms and different institutions’ offerings.
In some cases, you may find a shorter-term CD with a special or promotional rate. Sometimes shorter-term CDs may actually offer higher rates. But you won’t be able to lock them in for as long as with a 5-year CD. This is something to consider if interest rates fall.
At the same time, to earn this higher interest, you have to commit to leaving your money in the CD for longer than with other, shorter-term CDs. Early withdrawal penalties also tend to be higher for 5-year CDs than shorter-term options.
Is a 5-Year CD Right for You?
To decide if a 5-year CD is right for you, financial professionals recommend you balance the highest interest rate with the ideal length of time you can keep your money in savings.
Early withdrawal incurs a penalty, meaning a 5-year CD may only be suitable if you are sure that you won’t require the money tied up in the CD until it hits maturity.
If this is too long for your financial goals — or needs — you may want to expand your search to CDs with shorter terms that better align with your timeline but still offer competitive rates.
Talking with a financial advisor or other professional can help you decide which CD term best fits your personal finance plans.
Frequently Asked Questions About 5-Year CDs
Banks and credit unions set their own CD terms, which typically range from one month to 10 years. Not all institutions provide all terms in that range, but the most common besides 5-year CDs include 3-month, 6-month, 12-month, 2-year and 3-year CDs.
Fixed-rate certificates of deposit pay a guaranteed rate for the term of the CD. You can lose some or all of your interest if you withdraw money before the end of the term, but if your CD is insured by the FDIC or NCUA, it’s covered up to $250,000 if the institution fails.
Investment alternatives to 5-year CDs may include high-yield savings accounts, money market accounts, bonds and fixed-rate annuities. Returns on investments may vary and may not guarantee a fixed rate of return.