Table Of Content
In recent years, American Express has expanded its services to include banking products including CDs.
American Express CDs allow you to choose a term of up to five years, locking in your rate for guaranteed returns. There are no monthly fees and no minimums, so you can enjoy an FDIC insured product backed by the 24/7 American Express customer support.
With American Express CDs, you can either keep the returns in your account to earn more interest or withdraw your interest with no penalty. However, as with most CDs, if you withdraw some or all of your principal balance before the CD matures, you will incur a penalty.
American Express CDs
APY Range
Minimum Deposit
Terms
Our Rating
American Express CDs
APY Range
Minimum Deposit
Terms
Our Rating
How American Express Bank CDs Work
American Express aims to make setting up a CD as simple as possible. You can open a new CD account in only a few minutes and American Express will check public records to verify your personal details. No minimum deposit exists, so you can open your new CD with any amount, but there are no Jumbo CDs or unique benefits for high amounts. The rates are set according to your CD term.
For those who are looking for a monthly cd ladder, Amex is not a good option. The gaps between the different terms os too high, and you can get higher rates on a few terms and not on many of them as you can find in other banks.
It is important to consider the CD term carefully, as if you need to withdraw some or all of your funds before maturity, an early withdrawal penalty is imposed. The amount of the penalty varies according to your CD term.
If your CD has a term of less than 12 months, the penalty is 90 days of interest. Terms of 12 to 48 months have a penalty of 270 days interest, terms of 48 to 60 months, the penalty is 365 days of interest and terms of 60 months or longer, you’ll pay 540 days of interest. .
Bear in mind that if the amount of the penalty exceeds the available interest that you’ve earned on your CD, American Express will deduct the difference from your CD account principal.
What Are The Amex Bank CDs Rates?
Overall, Amex CD rates are high compared to other banks including online banks. While the terms are limited, the rates are competitive. For example, if you're looking for a one-year CD, Amex offers 4.35% APY, which is among the highest you can find these days.
Additionally, keep in mind that you won't be able to utilize competitive short-term CDs. For instance, if you're interested in finding the best 3-month CD rates, you'll have to explore options at different banks.
Here are the rates as of June 2024:
CD Term | APY | Early Withdrawal Penalty |
|---|---|---|
12 Months | 4.35% | 270 days interest |
18 Months | 3.25%
| 270 days interest |
24 Months | 4.00% | 270 days interest |
36 Months | 3.00% | 270 days interest |
48 Months | 3.00% | 365 days interest |
60 Months | 3.00% | 540 days interest |
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How Much Can You Earn If You Deposit $100,000 Today?
In case you deposit $100,00 to Amex CD, here are the expected earnings (before tax) in case the interest is compounded daily:
CD Term | APY | Interest Earned |
|---|---|---|
12 Months | 4.35% | $4,538 |
18 Months | 3.25%
| $4,925 |
24 Months | 4.00% | $8,210 |
36 Months | 3.00% | $9,282 |
48 Months | 3.00% | $12,564 |
60 Months | 3.00% | $15,944 |
Are American Express Bank CD Rates Competitive Compared to Other Banks?
When comparing American Express CDs with CD products offered by online banks, American Express remains competitive. Several online banks offer impressive rates on their CD products, but some of the American Express CD terms can stand up to a head-to-head rate CD comparison.
However, it is important to note that many online banks impose a minimum initial investment to access the higher rates, which does not apply to American Express CDs.
American Express Bank CD Rates vs Savings Rates
If you’re unsure about American Express CDs, you may want to look at the American Express High Yield Savings. You can still enjoy a fixed rate, which is lower than the highest American Express CD rates, but beats the base rate. You can also enjoy access to your funds, but you are limited to a maximum number of withdrawals per month.
The key difference between an American Express CD and its High Yield Savings Account is that you can continue to add funds to your savings account. Once you open a CD, there is a 10 day period when you can add further funds, after this, your CD account is locked. However, with a savings account, you can add funds as and when you like.
Both types of American Express accounts have no monthly maintenance fees and no account minimums. So, if you’re unsure if you will be able to tie up your funds for a fixed period, you may be better suited with the Amex High Yield Savings Account.
About American Express Bank
American Express has an impressive history that dates back to 1850 and it is best known for being a credit card issuer. American Express credit cards are considered the gold standard for reward credit cards, offering some excellent benefits with reasonable annual fees. However, approximately ten years ago, American Express expanded its product line and began to introduce banking products.
One of the first products was its high yield savings account, but this was quickly followed by CDs. Today, American Express bank has a comprehensive product line that includes a checking account, IRAs, personal loans and business products. Here's our Amex bank review for 2024.
FAQs
Does American Express Bank Offer No Penalty CD Rates?
Unfortunately, no, American Express Bank does not currently offer a no penalty CD.
Does American Express Bank offer promotions on CDs?
American Express Bank does not have specific CD promotions, but depending on the term that you select, you can earn a higher rate.
Which Amex CDs will earn you the most money?
The best rate is offered with the 60 month Amex CD, but you can get almost the same rate with a 12 or 24 month CD. Just bear in mind that if you need to withdraw early, you will incur a penalty.
So, if you’re unsure about tying up your funds for five years, it is better to opt for the slightly lower rate offered with the 12 or 24 month term.
How are American Express Bank CDs interest calculated?
The interest on American Express Bank CDs is compounded daily and then deposited into your account on a monthly basis. You can withdraw your interest payments without penalty, but the overall rate is calculated based on leaving the interest in the account to earn further interest.
How does the American Express Bank early withdrawal penalty work?
The early withdrawal penalty for American Express Bank CDs varies according to the CD term. The penalty is calculated in terms of days of interest. The longer your CD term, the higher the interest penalty.
This ranges from 90 days to 540 days and if you don’t have sufficient interest in the account to cover the penalty, American Express will take the remainder from the principal balance of your account.
Compare Amex CDs
Marcus CDs vs Amex CDs
American Express and Marcus offer competitive rates on savings with no monthly fees. However, a mobile check deposit is not available.
Amex CDs vs Bread Savings CDs
American Express and bread savings offer highly competitive CD rates. But there are drawbacks and differences between them: Amex High Yield Savings vs Marcus Savings Account
How We Rate Certificates of Deposits: Our Methodology
The Smart Investor team has thoroughly examined certificate of deposit (CD) offerings from various banks, considering multiple factors to provide a comprehensive evaluation. Here's how we rated them across four key categories:
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CD Rates (50%): We meticulously analyzed the interest rates offered by each bank on their certificate of deposit (CD) products. Higher ratings were awarded to banks offering competitive rates that provide maximum returns for customers' investments. Factors such as the yield curve, current market conditions, and consistency of rates were considered to assess the attractiveness of each bank's CD rates.
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CD Features (30%): This category evaluated the features associated with each bank's certificate of deposit offerings. Factors considered include the variety of terms available, early withdrawal penalties, minimum deposit requirements, and any additional features or benefits. Higher ratings were given to banks offering a diverse range of CD terms, reasonable early withdrawal fees, and flexible options to meet customers' investment needs.
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Customer Experience (10%): A positive customer experience is paramount, even when investing in CDs. We assessed each bank's performance in this area, considering factors such as the ease of opening a CD account, the responsiveness of customer service, and overall user satisfaction. Higher ratings were assigned to banks with efficient account opening processes, helpful customer support, and a track record of satisfying customers.
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Bank Reputation (10%): The reputation of a bank is a critical consideration when investing in CDs. We evaluated each bank's reputation based on factors such as financial stability, regulatory compliance, and public perception. Higher ratings were given to banks with a solid reputation for reliability and trustworthiness, ensuring customers' investments are safe and secure.
By considering these categories and assigning appropriate weights to each, our review aims to provide valuable insights to help individuals make informed decisions when investing in certificate of deposits.
