Best 3-Month CD Rates of April 2021

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Point of Interest

If you’re looking for a low-risk investment, 3-month CDs are a solid way for investors to earn guaranteed profits with no risk. While this type of investment won’t earn you as much on your deposit as other, more risky options, it’s a safe way to grow your money.

Opening a 3-month certificate of deposit is a quick way to earn a return on your savings since the average rate is about 0.20% APY. But where can you find the best 3-month CD rates? Well, it’s not entirely about rates. Yes, the best 3-month CD for you should have high-interest yields, but it should also have low early withdrawal penalties and minimum balance limits that fit your budget.

To simplify your research process, we’ve found six institutions offering the best 3-month CD rates and terms. Afraid of commitment? No problem. This product only asks for three months. It’s a great way to get your investing feet wet without the worry of having money tied up for too long.


6 Best 3-month CD Rates of July 2020

  • Ally Bank — 0.35% APY
  • TIAA Bank — 0.35% APY
  • Barclays — 0.35% APY
  • Citibank — 0.25% APY
  • Discover — 0.25% APY
  • Synchrony Bank — 0.25% APY

Ally Bank — 0.35% APY

Ally Bank is an award-winning online bank that offers a comprehensive suite of products, including 3-month CDs. Its $0 minimum balance makes it an accessible option, and the 0.35% 3-month CD rate gives a higher return than a standard savings account. The penalty for early withdrawal is 60 days of interest, which is also less than all of the CDs on this list, making it an excellent option for those new to investing. Ally also offers a 0.05% incentive reward to renew CDs, boosting future yields.

TIAA Bank — 0.35% APY

TIAA Bank offers CDs backed by its “Yield Pledge Promise to review competitors’ rates weekly and remain in the top 5% of competitive accounts. Its current CD rate of 0.35% is one of the best 3-month CD rates offered by a bank. What is the catch? Well, the minimum balance to open a CD with TIAA is $5,000, so you will have to have a little stockpile of savings. Furthermore, if you need to pull out your money early, you’ll have to say goodbye to any interest you’ve earned.

Barclays — 0.35% APY

Lastly, Barclays began 300 years ago in London. This globally recognized brand has always been driven by strong values. Its 3-month CD requires $0 minimum balance, making it an option for investors of all levels. While its APY of 0.35% is the lowest in this list, it is three times the average of standard savings accounts and could, therefore, be a solid option for first-time investors with smaller amounts to invest. The early withdrawal penalty here is also 90 days.

Citibank — 0.25% APY

Founded in 1812 in New York, Citibank now services over 200 million customers in over 160 different countries. While the full list of services the bank offers is pretty comprehensive, one of the attractive investment options from Citibank is a 3-month CD with a rate of 0.55%.

Getting this rate only requires a minimum deposit of $500. Citibank also offers short-term CD laddering so you can invest your money across multiple CDs, which can give you more liquidity and the potential to earn higher overall interest rates.

Discover — 0.25% APY

Founded in 1911, Discover Bank has been offering personal finance products for over a century now. The 3-month CD rates at Discover are currently 0.35%, which isn’t as high as some competitors. Still, Discover doesn’t have a minimum deposit requirement, which might make this an attractive option to some investors.

Like many of the other banks and credit unions offering CDs, an early withdrawal from a 3-month CD with Discover will result in giving up all of the interest you’ve earned. Your principal (the amount you invested) is never at risk, but you will lose your interest gains.

Synchrony Bank — 0.25% APY

3-month CDs are available from Synchrony Bank with an APY rate of 0.25%. While slightly lower than the other rates listed, it may still be a good option if you’re looking for a CD as part of your IRA or if you want to withdraw your interest with no penalty. The account minimum with Synchrony is not as high as TIAA Bank but is still substantial at $2,000. Early withdrawal penalties with Synchrony are 90 days worth of interest for CDs with terms under 12 months.

Compare the 6 best 3-month CDs of 2020

ProviderAPYEarly Withdrawal PenaltyMinimum DepositBest For
Ally0.35%60 days$0 Best online bank
TIAA Bank0.35%90 days$5,000 Best yield pledge promise
Barclays0.35%90 days$0 Best for existing customers
Citibank0.25%Not listed$500 Best for short-term CD ladders
Discover0.25%3 months$0 Best for short-term CD ladders
Synchrony Bank0.25%90 days$2,000 Best for interest withdrawals

*Rates accurate as of July 17, 2020

What is a 3-month CD?

A 3-month CD is a type of federally insured deposit product with a fixed interest rate and a fixed date of withdrawal three months after the deposit. In exchange for agreeing to keep your money in the account for three months, you get higher interest yields than most traditional savings accounts.

Why might you want a 3-month CD? CDs range from one month in length up to 60 months. The short-term options like a 3-month CD, have the benefit of a shorter commitment. If you cancel before the term of a CD is up, the institution typically charges you a penalty that can cancel out the earnings. So, if you don’t have much money saved yet and aren’t fully comfortable locking it up long-term, short-term CDs are a good option.

Short-term CDs can also help you if you have trouble saving money, as the penalty will provide some motivation to leave it alone. After you complete a 3-month CD, you can work your way up to longer terms and larger returns from there.

Who is a 3-month CD good for?

If you’re looking for a short-term way to make a little extra money, a 3-month CD may be a viable option. The thought of investing your money for an extended period of time can sometimes be a deterrent when looking into investing in a CD, but not with 3-month CDs. This short CD term gives you the ability to earn higher interest rates than you would with savings accounts or money market accounts without tying up your deposit for the long term. This could be beneficial if you have a surplus of cash, like money you owe for taxes that are due to be paid in 6 months or more, or perhaps some money you have saved up for a major purchase that is at least three months away.

If you’re looking to earn higher rates of return on your investment, you may be more interested in stocks or bonds, which are riskier but offer more potential return. But if you’re looking for a guaranteed return with no risk (that will still help change your life for the better), consider a short-term investment in a CD.

Jason Lee

Personal Finance Contributor

Jason Lee is a seasoned copywriter with a passion for writing about banking, tech, personal growth, and personal finance. As a business owner, relationship strategist, and officer in the U.S. military, Jason enjoys sharing his unique knowledge base and skill set with the rest of the world.