Summer's best 3-year CD rates start at over 2%
It was three summers ago that the top national rate on 36-month CDs sank to 1.50% APY, and we still have only incremental progress to report.
In the three years since June 2012, the leading 36-month rate descended even further to 1.40% before experiencing a number of spikes that briefly took the top return as high as 1.70%, 1.75% and even 1.85% APY.
But none of those higher rates stuck, and this past January, the top national return for 3-year CDs not only disappointingly fell back to 1.50% APY but became stubbornly anchored there for five months.
Finally, we’ve seen a flurry of rate increases this month, with three improvements to the top rate within two weeks.
Yet with each increase raising the lead by just one or two hundredths of a percentage point, the current top rate, offered by EverBank, has only marginally improved to 1.54% APY.
TOP 36-MONTH CD RATES: Nationally Available Bank Deals
|First Internet Bank||1.51%||$1,000|
|Gulf Coast Bank & Trust||1.50%||$2,000|
|California First National Bank||1.45%||$5,000|
|Ally Bank||1.40%||No minimum|
|Capital One 360||1.40%||No minimum|
|Colorado Federal Savings Bank||1.40%||$5,000|
Fortunately, many savers can do better by investing through a credit union or community bank, which are paying 2% or more on their certificates of deposit.
Two credit unions actually offer nationally available 3-year CDs that beat the top-paying banks:
- USAlliance Federal Credit Union is paying 1.71% APY on 35-month certificates, available to select residents of Massachusetts and Connecticut, those who work for certain employers in New York, and anyone nationwide who makes a donation to an affiliated charitable organization.
- First Tech Federal Credit Union is offering a 36-month rate of 1.60% APY. Membership in the credit union is open to various Oregon employees and residents, as well as anyone in the country who becomes a member of the Financial Fitness Association for a $5 fee.
But it's the local deals that always offer the absolutely best returns — up to 2.78% right now.
TOP 3-YEAR CD RATES: Credit Union, Community Bank Deals
|Bank||States||Term (in months)||APY|
|Four Corners Federal Credit Union||Arizona, Colorado, New Mexico, Utah||36||2.78%|
|University of Iowa Community Credit Union||Iowa||37||2.40%|
|Self Reliance New York Federal Credit Union||New York||36||2.33%|
|Gulf Coast Federal Credit Union||Texas||36||2.02%|
|Cedar Falls Community Credit Union||Iowa||37||2.00%|
|Vibrant Credit Union||Illinois, Iowa||33||2.00%|
|Linn Area Credit Union||Iowa||33||2.00%|
|Veridian Credit Union||Iowa, Nebraska||39||1.96%|
|Champion Credit Union||North Carolina||36||1.90%|
|First NBC Bank||Louisiana||36||1.77%|
|North Platte Union Pacific Employees Credit Union||Nebraska||36||1.76%|
|Lower East Side People’s Federal Credit Union||New York||36||1.75%|
|NavyArmy Community Credit Union||Texas||36||1.75%|
|Severn Savings Bank||Maryland||36||1.75%|
|Suncoast Credit Union||Florida||36||1.65%|
|Associated Credit Union of Texas||Texas||36||1.60%|
You definitely want to take advantage of these deals because they pay at least three times more than the current average return of 0.56% APY, according to our weekly nationwide survey of banks and thrifts.
The average return fell as low as 0.43% two summers ago before beginning a slow but steady rebound that's returned the typical yield to where it was in December 2012.
Unfortunately, we're still a long way from February 2007 — before reckless mortgage lending plunged us into the Great Recession — when the average return on 36-month CDs was 3.8% APY.
The Federal Reserve’s subsequent efforts to rescue the economy by dropping interest rates in December 2008 — and the economy’s sluggishness in responding — have led to savers suffering depressed deposit rates for more than six years now.
Fortunately, the Fed appears to be nearing a rate hike, likely this fall or early winter.
Until that day comes, we’ll continue to keep you informed of the best-paying options here.