Top national 6-month CD rates pay 0.93%
For 18 months, the top nationally available 6-month CD rate held steady at 1.05%, offered almost unwaveringly by one leading bank.
But that changed in September, when the most you could earn from a 6-month certificate fell below 1% for the first time since April 2015.
For savers seeking worthwhile short-term yields, one option is to instead sink funds into a nation-leading savings or money market account, since close to 20 banks currently pay more than the best national 6-month CD.
But if locking your investment and rate for a guaranteed six months is preferred, your best bet is to shop the local or regional deals that beat the national banks, some paying as much as 2.00% APY.
What about the future? Can we expect another rate bump from the Fed anytime soon? Our crystal ball is as nonexistent as everybody else's, but we'll tell you what to watch.
The top national deals
The previous 1.05% APY leader among nationally available 6-month CD rates was MySavingsDirect.
When it rose to the top of our rankings in spring 2015, it became the first bank to pay a 6-month yield above 1.00% in more than four years.
Indeed, from 2011 to early 2015, the top national yield had languished between 0.80% and 0.93% APY (if you don't count a few ultra-brief blips at 1.00% APY).
But in early September, MySavingsDirect abandoned the lead when it lowered its 6-month return to 0.85% APY.
The top spot is now occupied by VirtualBank and its 0.93% APY offer.
Operating solely online, VirtualBank is an FDIC-insured division of Miami-based Sabadell United Bank, which operates two dozen branches throughout Florida and is owned by Banco Sabadell, Spain’s fifth-largest bank.
TOP 6-MONTH CD RATES: Nationally Available Bank Deals
|Live Oak Bank||0.90%||$2,500|
|Colorado Federal Savings Bank||0.90%||$5,000|
|First Internet Bank||0.86%||$1,000|
|EH National Bank||0.86%||$10,000|
|Triumph Savings Bank||0.85%||$1,000|
|Federal Savings Bank||0.80%||$10,000|
Earning more locally
As we always say, credit union and community bank CDs are usually the best game in town for those who live in the right place or work for a certain employer.
In fact, more than a dozen currently outpay VirtualBank's 0.93% APY on CD terms of 3 to 9 months.
The best of these is paying 2.00% APY for qualified savers willing to stretch to 9 months. For a strict 6-month term, 1.74% is the leading offer.
As always, eligibility requirements apply. So contact the bank or credit union directly to determine if you qualify.
TOP REGIONAL 6-MONTH CDS: Credit Unions & Community Banks
|Bank||States||Term (in months)||APY|
|Village Credit Union||Iowa||9||2.00%|
|Peoples Transport Federal Credit Union||New Jersey||6||1.74%|
|Self Reliance New York Federal Credit Union||New York||6||1.41%|
|Mil-Way Federal Credit Union||Texas, Arkansas||6||1.05%|
|Down East Credit Union||Maine||5||1.00%|
|American Investors Bank & Mortgage||Minnesota||6||1.00%|
|Muskegon Co-op Federal Credit Union||Michigan||6||1.00%|
|Riverdale Credit Union||Alabama||6||1.00%|
|State Employees’ Credit Union||North Carolina||6||1.00%|
|Sun Community Federal Credit Union||California||6||1.00%|
|Triangle Credit Union||New Hampshire, Massachusetts||6||1.00%|
|HarborOne Bank||Massachusetts, Connecticut, Maine, New Hampshire, Rhode Island, Vermont||7||1.00%|
Whether it's a local deal or a leading national CD, you'll want to take advantage of offers like these since they all pay at least five times more than the current national average of 0.19% APY, according to our weekly nationwide survey of banks and thrifts.
Waiting for a Fed impact
The national average for 6-month CDs sank to a record low of 0.14% APY in September 2013 and remained there as recently as June 2014.
Back in February 2007, before irresponsible mortgage lending led the economy over a cliff, the average return for 6-month CDs was 3.50% APY.
But after the Federal Reserve stepped in to talk the markets off a ledge by holding interest rates down to allow the economy to rebuild to full capacity, it kept them there for seven years.
That era finally concluded last December when the Fed's rate-setting committee launched what was expected to be a series of gradual rate hikes over the next several years.
But then the global and market instabilities of 2016, coupled with a still-missing healthy inflation rate, have caused the Fed to downgrade expectations to wait-and-see, with no hikes announced at the seven meetings since December.
The Fed's next rate-setting meeting will be held Dec. 13-14, and finally, a majority on Wall Street predict we'll see the second rate hike announced.
Let's hope it comes and makes a difference in banks' rate sheets, because relief for long-suffering CD savers can't come soon enough.
Disclaimer: The rates above were verified Nov. 14, 2016. Banks and credit unions should be contacted directly to determine eligibility for opening accounts with that institution, as well as to verify current rates.