Best national 1-year CD rates still stuck at 1.30%

piggy bank in glasses

It's been another frustrating year for anyone buying 12-month CDs.

Last fall, we were encouraged to see the top nationally available return climb to 1.25% APY, which was a welcome contrast to one year before, when the top yield was still at its post-recession worst of 1.05% APY.

But 13 months later, the top 1-year bank rate has only improved to 1.30% APY — and it's been stuck there since late July.

Yields reached their highest level since 2011 when Colorado Federal Savings Bank paid 1.35% APY for five weeks this spring. But it's all been part of a faltering pattern that has brought us little true gain.

Two banks currently lead the term at 1.30% APY: CIT Bank and E-Loan.

CIT is the online consumer bank of CIT Group Inc., a New York-based commercial lender to small and midsize companies.

Its 12-month certificate of deposit comes in two flavors. The first is a standard term CD requiring a modest $1,000 minimum investment.

But for those who can deposit $25,000 or more, it offers a 12-month certificate that provides for one rate bump and one added deposit during the CD's term.

Meanwhile, E-Loan is an online operation run by Popular Community Bank, which is the mainland sister to Puerto Rico's biggest bank, Banco Popular.

With almost 50 branches throughout New York, New Jersey and South Florida, Popular Community's deposits (including those made through E-Loan) are fully insured by the FDIC.

E-Loan's 1-year CD is offered in just one format: a standard certificate requiring a $10,000 minimum deposit.

TOP 12-MONTH CD RATES: Nationally Available Bank Yields

Bank APY Minimum Deposit
CIT Bank 1.30% $1,000
E-Loan 1.30% $10,000
iGObanking 1.25% $1,000
Triumph Savings Bank 1.25% $1,000
Synchrony Bank 1.25% $2,000
Sallie Mae Bank 1.25% $2,500
California First National Bank 1.24% $5,000
AloStar Bank 1.21% $1,000
BAC Florida Bank 1.21% $1,500
BankDirect 1.21% $10,000
Colorado Federal Savings Bank 1.20% $5,000
VirtualBank 1.16% $10,000
Discover Bank 1.15% $2,500
American Bank 1.10% $500
Amboy Direct 1.10% $10,000
Silvergate Bank 1.08% $25,000
Giant Bank 1.06% $2,500
Ally Bank 1.05% No minimum
AmTrust Direct 1.05% $500
MyBankingDirect 1.05% $500
Nationwide Bank 1.05% $500
State Bank of India – Chicago 1.05% $2,500
State Bank of India – New York 1.05% $5,000
TIAA Direct 1.01% $1,000

As is often the case, many savers can find better 1-year returns by turning to credit unions and community banks.

Three credit unions even offer nationwide deals for those who are willing to invest for two or three extra months:

For those who live in the right place or work for the right employer, it's possible to make even more from 1-year CDs.

The best return on strictly local deals is pushing 2% this month.

TOP 1-YEAR CD RATES: Credit Union, Community Bank Deals

Bank States Term (in months) APY
Peoples Transport Federal Credit Union New Jersey 12 1.94%
Self Reliance New York Federal Credit Union New York 12 1.92%
Four Corners Federal Credit Union Arizona, Colorado, New Mexico, Utah 12 1.56%
LG&E Co. Credit Union Kentucky 14 1.51%
Seasons Federal Credit Union Connecticut 14 1.51%
Idaho Central Credit Union Idaho, Nevada 12 1.50%
North Platte Union Pacific Employees Credit Union Nebraska 12 1.50%
Westmark Credit Union Idaho 13 1.50%
BCB Community Bank New Jersey, New York 15 1.50%
Direct Federal Credit Union Massachusetts 15 1.50%
Kearny Bank New Jersey 15 1.50%
Needham Bank Massachusetts 15 1.50%
Grand Rivers Community Bank Illinois 12 1.45%
Rockland Federal Credit Union Massachusetts 11 1.40%
Premier Credit Union Iowa 14 1.40%
First Bank & Trust Texas 15 1.40%
Walpole Co-operative Bank Massachusetts 15 1.40%
Community First Credit Union Wisconsin 17 1.37%

If you qualify, these deals are worth your effort since they all pay about five times more than the current average 12-month return of 0.28% APY, according to our weekly nationwide survey of banks and thrifts.

Average 1-year returns had fallen as low as 0.22% APY and still sat there in January 2014. But the improvements have been painfully slow and totally stalled for almost five months now.

Of course, all of these rates are a far cry from the 12-month average of 3.78% APY we saw in February 2007 — before reckless mortgage lending plunged us into the Great Recession.

Now, almost seven years after the Federal Reserve dropped interest rates to about zero in a bid to revive the economy, the Fed is finally close to reversing course and pushing rates higher over the next several years.

Several members of the bank's rate-setting committee have said they expect the rate hikes to begin in 2015. But there are just two meetings left this calendar year — one next week and one in mid-December.

It's unlikely we'll see a Fed increase at the October meeting, and there's no guarantee we'll even see it by year's end.

But whenever the process does begin, it's fair to expect returns to be higher by the time a 1-year CD bought now matures next October.