Points of Interest
When it comes to CD options, 2-year CDs are available from many top online banks or brick and mortar financial institutions. The best 24-month CDs offer competitive rates and have low or no minimum requirements to open an account.
The 6 best 2-year CDs of 2020
- CIT Bank — Best online CD
- Synchrony — Best customer perks (dedicated phone lines)
- Capital One — Best mobile app
- Marcus Goldman Sachs — Best 10-day rate guarantee
- TIAA Bank Yield Promise — Best IRA compatibility
- Navy Federal Credit Union — Best for military and dependents
CIT Bank — Best online CD
CIT Bank, headquartered in Pasadena, California, offers fixed-term CDs up to five years in length, with a minimum deposit of $1,000. While several no-minimum CD options exist, the minimum deposit of $1,000 required by CIT Bank is still fairly reasonable. CIT CDs can be funded through electronic transfers, mailed checks or bank wires.
The APY rate on a CIT 2-year CD is higher than most brick and mortar banks and a little lower than some of the other online banking options. Still, at 1.00%, it is an attractive rate.
Synchrony Bank — Best customer perks
Founded in 1988, Synchrony Bank started many as a wholly-owned subsidiary of General Electric. Over time, the company expanded operations to offer a host of products, including certificates of deposit with attractive rates.
While Synchrony’s minimum deposit requirement of $2,000 is higher than some banks, which may be a deterrent for some people. Still, the 1.00% APY is a decent rate for 2-year CDs — plus Synchrony customers get access to unique travel and leisure discounts that may be beneficial to you.
Capital One — Best mobile app
Known for its credit cards and impressive mobile app, Capital One also offers 2-year CDs for investors who want a guaranteed rate of return. CDs through Capital One are available with no minimum deposit, no fees, and high interest rates, regardless of how much is invested.
The bank offers CDs with terms from 6 months to five years, with the highest rates on 48-month and 60-month CDs. People interested in a 2-year Capital One CD might want to consider a longer-term option, as it will offer a better APY rate.
Marcus – Best rate guarantee
If you’re looking for a financial institution steeped in history, you’ll find it at Marcus Goldman Sachs. It was started in 1869 by founder, Marcus Goldman and has thrived in its goal of sharing its financial expertise and grown to become the multinational investment bank that it is today. Goldman Sachs offers many investing products from loans to high-yield savings and CDs and more.
Marcus Goldman Sachs has an interesting setup that sets them apart from many of their competitors. Not only can you open a CD with a minimum deposit of $500, but the bank gives you 30 days to fully fund your CD account. They also have guaranteed rates, which is common among other top banks but isn’t always the case. So, it’s nice to have that assurance when looking for the best 24-month CD rates and which institutions to consider.
One of the interesting things about this pick for best 24-month CD rates is that the institution will give you the highest published interest rate and APY during the first 10 days from the time you open your account. This only applies to Marcus branded CDs with at least $500 deposited during that period.
TIAA Bank – Best IRA compatibility
TIIA Bank has a 5-star BauerFinancial rating, which speaks for itself since BauerFinancial ratings are unbiased, independent ratings. Considering TIIA also offers no monthly account maintenance fees and industry-competitive yields, TIIA CD offerings might be worth a try. Here’s the breakdown.
TIIA has a minimum deposit requirement of $5,000 to get started, which is larger than many other banks and you also have to be an existing TIIA Bank client who is also eligible for online check deposit enrollment. However, you can access your account anytime using its Apple mobile app. It also has an interesting take on the best 2-year CD rates by backing its annual percentage yield with a promise to always provide you with one of the highest rates from among the top 5% of its competitors. Finally, TIIA also offers you CDs that are IRA eligible, which can help boost your retirement savings plan.
Compare the 6 best 2-year CDs of 2020
|Provider||APY||Early Withdrawal Penalty||Minimum Deposit|
|CIT Bank||1.00%||6 months||$1,000|
|Capital One||.75%||6 months||$0|
|Marcus Goldman Sachs||1.10%||270 days||$500|
|TIAA Bank||1.10%||180 days||$5,000|
|Navy Federal||1.10%||180 days||$1,000|
*Rates accurate as of July 10, 2020
What is a 2-year CD?
A certificate of deposit is a product offered by most financial institutions. In essence, it is an agreement between you and your bank. You agree to leave a specific lump-sum deposit for a predetermined amount of time in the bank. In exchange, the bank offers a premium rate for your deposit, which matures at the end of its term.
There are advantages and disadvantages to investing in CDs. One of the biggest advantages is the premium rates offered. However, rates can change and they differ by term and institution. So, always ask or research the current rates before you invest.
A disadvantage is an early withdrawal. You can withdraw your money early, but doing so usually incurs a penalty — often a percentage or even all of the interest you earned. Overall, CDs are a great way to earn more on your money and increase your wealth. Here’s how CDs compare to other savings accounts.
Who is a 2-year CD good for?
A 2-year CD is a great short-to-medium length investment for people who are more risk-averse or are looking for guaranteed returns. The return rates on many of the top 2-year CDs are better than you’ll find with any savings account. While the return may not be as good as some stocks and bonds, it is still a guaranteed return — no matter how the market fluctuates.
If you’re not planning to need the money you invest for the next 24 months, a 2-year CD could be the ideal savings and investment tool. If you’ll need the funds prior to that two-year mark, you may want to choose a savings account or money market account to avoid early withdrawal penalties.