Best national 1-year CD rates pay 1.80%

piggy bank in glasses

Top national 1-year CD rates inched up in 2017, following the Fed rate hikes throughout the year.

In its recent December meeting, the Fed decide to lift rates again, citing an improving U.S. economy.

Indeed, it's not just 1-year CD terms that we've seen rise this year. CD rates across all terms have been on the move in an upward trend. Although, they are still a far cry from the nearly 4.00% yields we saw on 1-year CDs pre-recession.

As always, several credit unions and community banks are offering competitive deals — we'll share those with you.

And fortunately for savers, more Fed rate hikes could be in the cards for 2018.

The top national deals

Today's top yield among nationally available 12-month CDs is 1.80% APY.

While it's nice to see 1-year CDs hit that mark, we're naturally eager to see higher returns.

Still, it helps to remember that, after plunging in the spring of 2011, the leading 12-month yield wavered between its post-recession low of 1.05% and 1.10% APY for all of 2012 and half of 2013.

Fast forward to 2017 and one bank is currently offering the leading 1.80% APY rate: Live Oak Bank. That's with a $2,500 minimum deposit.

Based in Wilmington, Live Oak Bank does not operate any branches. All of its services are offered online.

Right behind Live Oak Bank, offering the second best deal, is ableBanking. It's paying 1.75% APY with a $1,000 minimum deposit.

TOP 12-MONTH CD RATES: Nationally Available Bank Deals

Bank APY Minimum Deposit
Live Oak Bank 1.80% $2,500
ableBanking 1.75% $1,000
Sallie Mae Bank 1.72% $2,500
EverBank 1.72% $5,000
Colorado Federal Savings Bank 1.70% $5,000
TAB Bank 1.70% $1,000
BAC Florida Bank 1.70% $1,500
VirtualBank 1.69% $10,000
State Bank of India-New York 1.68% $5,000
State Bank of India-Chicago 1.66% $2,500
Bank of Baroda 1.65% $1,000
Marcus by Goldman Sachs 1.65% $500
Capital One 1.65% No minimum
Synchrony Bank 1.65% $2,000
PenFed Credit Union 1.61% $0
Popular Direct 1.60% $10,000
Pacific National Bank 1.60% $1,000

All of these deals pay at least three times the current national average of 1-year CDs, which is 0.42% APY.

Earning more with local deals

Savers can often find better, or at least comparable, 1-year returns by turning to credit unions and community banks.

Florida Credit Union, for instance, is offering 1.76% APY, just below our national leader. And Idaho Central Credit Union matches our second place national leader at 1.75% APY.

But for those who live in the right place or work for the right employer, it's possible to make as much as 2%, or even 5%. That why it pays to shop for rates locally.

On all of the deals below, eligibility requirements apply. Contact the bank or credit union directly to determine if you qualify for membership.

TOP REGIONAL 1-YEAR CDS: Credit Unions & Community Banks

Bank States Term (in months) APY
Florida Credit Union Florida 12 1.76%
Idaho Central Credit Unon Idaho, Nevada 12 1.75%
USAlliance Financial Credit Union Nationwide 15 1.71%
Melrose Credit Union Nationwide 12 1.65%
Penfed Credit Union Nationwide 12 1.61%
Peoples Transport Federal Credit Union New Jersey 12 1.35%


Watching for a Fed impact

Average 1-year CD rates have been on the rise, but improvements have been slow, finally pushing to just 0.42% APY this December.

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

The dramatic descent in rates is a result of the Federal Reserve aiming to stave off a complete financial collapse by dropping interest rates to about zero in December 2008 — and keeping them anchored there for 7 years.

That dismal period ended 2 years ago, with the Fed's rate-setting committee approving what was expected to be the first of several small increases in the federal funds rate.

The Fed is forecasting that it will make 2-3 additional hikes in 2018. However, it's hard not to note the unknown impact the new members of the Fed may have. President Trump elected Jerome Powell to serve as the Fed Chair to replace Janet Yellen.

Yet there is reasonable hope that additional increases will arrive in 2018 that will translate into higher bank returns by the time a 1-year CD bought now matures next winter.

Disclaimer: The rates above were verified Dec. 15, 2017. Credit unions and banks should be contacted directly to determine eligibility for opening accounts with that institution, as well as to verify current rates.