Banking » Compare Banks » Best 2-Year CD Rates For February 2024: Comparison
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Best 2-Year CD Rates For June 2024: Comparison

The top 2-year CDs offer 4-5% APY. Here's a CD rates and earning comparison and things to consider when locking your money for 24 months.
Author: Baruch Mann (Silvermann)
Baruch Mann (Silvermann)

Writer, Contributor

Experience

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor.  Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more.
Interest Rates Last Update: June 3, 2024
The banking product interest rates, including savings, CDs, and money market, are accurate as of this date.
Author: Baruch Mann (Silvermann)
Baruch Mann (Silvermann)

Writer, Contributor

Experience

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor.  Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more.
Interest Rates Last Update: June 3, 2024

The banking product interest rates, including savings, CDs, and money market, are accurate as of this date.

We earn a commission from our partner links on this page. It doesn't affect the integrity of our unbiased, independent editorial staff. Transparency is a core value for us, read our advertiser disclosure and how we make money.

Table Of Content

A two-year CD has a two-year term, meaning your money is committed to it for that long. You will be charged an early withdrawal penalty, which is often several months' worth of interest, if you do need some or all of your money before this maturity date.

When your CD matures after two years, you can choose to take all or a portion of your money or renew for another two years.

Compare 2-Year CD Rates

Comparing interest rates is an important step when choosing a 2-year CD. The interest rate is the most important factor in determining the returns you will receive from a CD, and it can vary significantly between different banks and credit unions.

Financial Institution
2 Year CD APY
Minimum Deposit
4.20%
$0
4.53% – 4.58%
$5,000
4.00%
$0
4.00% (25 months)
$500
4.00%
$0
4.00%
$2,500
4.00%
$1,000
4.50%
$2,500
4.40%
$1,000
4.50%
$2,500
4.20% – 4.25%
$1,000
4.40% (25 months)
$1,000
4.20%
$500
4.65%
$25,000
1.00% – 4.00%
$250
4.65%
$1,500
4.50%
$1,000
1.20%
$250
3.00%
$50
4.50%
$1,000

How Much You Can Earn With 2-Year CD?

Here's your expected earnings (before tax) if you lock your money for 24 months. This is just an estimate, and the actual amount of interest you earn may be different based on the terms and conditions of the CD.

Financial Institution
2 Year CD APY
Interest Earned
Synchrony Bank
4.20%
$8,852
Connexus Credit Union
4.53% – 4.58%
$8,231 – $8,766
American Express Bank
4.00%
$8,761
Capital One Bank
4.00%
$8,852
Discover Bank
4.00%
$8,852
PenFed Credit Union
4.00%
$9,174
Fidelity
5.10%
$9,931
Vanguard
5.50%
$10,583
Sallie Mae
4.50%
$9,498
TIAA Bank
4.40%
$8,852
LendingClub
4.50%
$8,423
Navy Federal
4.20% – 4.25%
$8,637 – $8,744
Marcus
4.20%
$8,959
Merrick Bank
4.65%
$9,390
TD Bank
1.00% – 4.00%
$8,744
Bread Financial
4.65%
$9,282

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What Are the Main Drawbacks of a 2-Year CD?

While a 2-year CD can be a good option for some investors, there are a few potential drawbacks to consider:

  • Limited liquidity: One of the main drawbacks of a 2-year CD is that your funds are locked in for the full term of the CD. If you need to access your money before the end of the 2-year term, you may incur a penalty, and you may also miss out on potential returns from other investments.

  • Interest rate risk: If interest rates rise after you've invested in a 2-year CD, you may miss out on potential returns from other investment options. Additionally, if you renew your CD at the end of the 2-year term, you may be locked into a lower interest rate.

  • Inflation risk: The returns from a 2-year CD may not keep pace with inflation over the long term, which can erode the purchasing power of your investment.

While a 2-year CD can be a good option for some investors, it's important to consider your individual financial goals and risk tolerance before investing.

Financial Institution
2 Year CD Early Withdrawal Penalty
Synchrony Bank
180 days of interest
Connexus Credit Union
180 days of interest
American Express Bank
270 days of interest
Capital One Bank
6 months of interest
Discover Bank
6 months of interest
PenFed Credit Union
365 days / 30% of dividends
Sallie Mae
180 days of interest
TIAA Bank
25% of total interest
Live Oak Bank
180 days of interest
LendingClub
All interest
Navy Federal
180 days of dividends
Marcus
180 days of interest
Merrick Bank
180 days of interest
TD Bank
9 months of interest
Bread Financial
180 days simple interest

When You May Want to Skip a Two Year CD

There are several reasons why you may want to skip a 2-year CD:

  • Higher returns are available elsewhere: If you're looking for higher returns on your investment, you may be better off investing in other options such as stocks, bonds, or real estate. These types of investments may offer higher returns, but they also come with higher risks.

  • You need access to your money: If you need to access your funds in the next 2 years, a 2-year CD may not be the best choice. With a CD, you're committed to leaving your funds invested for the full term, and early withdrawals may incur penalties.

  • You're not comfortable with a fixed interest rate: If you're concerned that interest rates may rise over the next 2 years, you may want to skip a 2-year CD. With a CD, you're locked into a fixed interest rate for the full term, and you won't be able to take advantage of higher returns if interest rates increase.

  • You're looking for more flexibility: If you're looking for more flexibility with your investments, a 2-year CD may not be the best choice. With a CD, you're committed to leaving your funds invested for the full term, and you won't be able to make changes to your investment until the CD matures.

2-Year CD vs. Savings Account: Things To Consider

A 2-year CD and a savings account are both savings vehicles, but they have some key differences:

  • Interest Rates: A 2-year CD typically pays a higher interest rate than a savings account. This is because the bank can count on having your funds invested for a longer period of time, and it can offer a higher rate to compensate for the lack of liquidity.
  • Accessibility: A savings account is a highly liquid investment, and you can access your funds at any time without penalty. With a 2-year CD, your funds are locked in for the full term of the CD, and early withdrawals may incur penalties.
  • Flexibility: A savings account is a flexible investment, as you can make deposits or withdrawals at any time. With a 2-year CD, your funds are locked in for the full term, and you won't be able to make changes to your investment until the CD matures.

In conclusion, a 2-year CD and a savings account both have their pros and cons, and the best choice for you will depend on your individual financial goals and risk tolerance.

If you're looking for a low-risk investment with easy accessibility, a savings account may be the better choice. If you're looking for a higher return and are willing to lock in your funds for a set period of time, a 2-year CD may be a good option.

Financial Institution
2 Year CD APY
Savings Account APY
Synchrony Bank
4.20%
4.75%
Connexus Credit Union
4.53% – 4.58%
3.41% – 4.91%
American Express Bank
4.00%
4.25%
Capital One Bank
4.00%
4.25%
Discover Bank
4.00%
4.25%
PenFed Credit Union
4.00%
3.00%
Sallie Mae
4.50%
4.50%
TIAA Bank
4.40%
5.05%
Live Oak Bank
2.00%
4.40%
LendingClub
4.50%
5.00%
Navy Federal
4.20% – 4.25%
0.25%
Marcus
4.20%
4.40%
Merrick Bank
4.65%
N/A
TD Bank
1.00% – 4.00%
0.01% – 4.00%
Bread Financial
4.65%
5.15%

How We Picked The Best 2-Year CD Rates: Methodology

The Smart Investor team has extensively reviewed banks and credit unions to identify the best 2-year CD (Certificate of Deposit) rates available. We focused on four main categories to rate them:

  • Interest Rates and Terms (50%): We looked at the interest rates offered on 2-year CDs and any associated terms and conditions. Banks offering higher interest rates and favorable terms, like low minimum deposit requirements and reasonable penalties for early withdrawal, received higher ratings in this category.

  • Account Features (20%): This category assessed additional features and benefits offered by each 2-year CD, such as automatic renewal options, choices for interest payouts (monthly, quarterly, or at maturity), and eligibility for promotional rates. CDs with more features or flexibility earned higher scores.

  • Customer Experience (20%): We evaluated the ease of opening a 2-year CD, communication with customer service representatives, usability of online banking platforms (tested by our team), and availability of support channels. Banks with smooth processes, responsive customer service, and user-friendly online interfaces received higher ratings.

  • Financial Stability and Reputation (10%): Our team analyzed each bank's financial stability and reputation, considering factors such as customer satisfaction ratings, JD Power scores, TrustPilot reviews, and the bank's Better Business Bureau (BBB) profile. Banks with strong financial standings and positive reputations received higher ratings.

We assigned weights to various features and qualities within each category to ensure a comprehensive evaluation of each 2-year CD.

Compare CD Rates

Picture of Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor.  Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more.
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