A certificate of deposit, or CD, is a savings account offered by banks and credit unions in which a lump sum of money earns interest at a fixed rate over a specified period of time, or term. These terms vary, from as short as one month to as long as 10 years (although many banks and credit unions offer CDs with terms ranging from three months to five years). Generally, the longer the term, the higher the interest rate — an incentive for parking your money in the account and not touching it for the duration of the term. But if you withdraw your funds before the term matures, you’ll be penalized by forfeiting the interest accrued, usually an amount equivalent to between 90 and 365 days of interest.
As interest rates rise, now is a good time to compare the rates you’re earning on any cash parked in your savings account. If the gains made from your savings account seem small because of inflation, a CD may be a better alternative.
What is an 18-month CD?
As its name suggests, an 18-month CD has a term of 18 months and generally pays a higher interest rate than, say, a three- or six-month CD. If you’re willing to keep your cash locked up in a CD account for a year-and-a-half while it accrues interest, then an 18-month CD can be an ideal option for your financial portfolio.
Once the CD has reached its 18-month maturity date, funds can be accessed without incurring an early withdrawal penalty. CDs typically have a grace period of seven to 10 days after maturity to give you time to decide if you want to withdraw the funds, purchase another type of CD or let the CD automatically renew. CDs offered by banks and credit unions are considered low-risk accounts because their value is insured by either the Federal Deposit Insurance Corporation or National Credit Union Administration for up to $250,000 per person.
CNET’s picks for the best 18-month CD rates
The table below lists the 10 highest-paying 18-month CDs, all of which earn annual percentage yields, or APYs, of at least 4%. That’s considerably higher than the 0.16% APY average for a standard savings account, according to CNET’s sister site Bankrate.
Best 18-month CD rates
| Bank/credit union | APY | Minimum deposit |
|---|---|---|
| CFG Bank | 4.60% | $500 |
| Skyla Credit Union | 4.50%* | $500 |
| Crescent Bank | 4.50% | $1,000 |
| Banesco USA | 4.40% | $1,500 |
| iGoBanking | 4.26% | $1,000 |
| CIT Bank | 4.25% | $1,000 |
| Popular Direct | 4.25% | $10,000 |
| Synchrony Bank | 4.25% | $0 |
| First Internet Bank | 4.23% | $1,000 |
| Marcus by Goldman Sachs | 4.15% | $500 |
Note: Annual percentage yields, or APYs, shown are as of Nov. 18, 2022. CNET’s editorial team updates this information regularly, typically biweekly. APYs may have changed since they were last updated and may vary by region for some products.
*Senior 18-month APY for people ages 50 and older.
More details on the best 18-month CD rates
CFG Bank
- APY: 4.60%
- Minimum deposit: $500
- Early-withdrawal penalty: 180 days of interest
Details: CFG Bank is a Maryland-based community bank that offers competitive rates on CDs, with reasonable deposits required to open accounts, making them accessible to a wide range of savers nationwide.
Skyla Credit Union
- APY: 4.50%
- Minimum deposit: $500
- Early-withdrawal penalty: Six months of interest
Details: Skyla Credit Union offers nine different terms on standard CDs ranging from six months to five years. The 18-month CD at 4.50% APY is a special senior offer only available to customers ages 50 years and older (the regular 18-month CD has a lower APY of 2.10%). There’s a current special on Skyla’s 21-month CD, which also has an APY of 4.50% and is available to all members. Skyla offers an 18-month jumbo CD at 4.50% APY, but the minimum deposit is $50,000.
Membership eligibility is open to anyone who joins the Carolinas Credit Union Foundation. A $5 minimum balance is required to open a savings account. Skyla Credit Union maintains 5,600 branches in North and South Carolina and a network of 30,000 surcharge-free ATMs. Skyla offers regular and jumbo CDs with terms ranging from six months to five years.
Crescent Bank
- APY: 4.50%
- Minimum deposit: $1,000
- Early-withdrawal penalty: Six months of interest
Details: Crescent Bank was founded in 1991, offering personal and banking services to the Greater New Orleans community. Since then, it has expanded to offer services nationwide with an emphasis on auto loans. Its CD rates are competitive and available only to new accounts with funds originating from external sources such as an existing savings account with a local credit union.
Banesco USA
- APY: 4.40%
- Minimum deposit: $1,500
- Early-withdrawal penalty: 90 days of interest
Details: Banesco USA is a Florida state-chartered bank founded in 2006 that operates independently of Venezuelan-based financial institution Banesco. Banesco USA operates branches in South Florida and Puerto Rico and has 43,000 surcharge-free ATMs through the Allpoint network in the US. Its 18-month CD is available to new accounts and open to US residents only.
iGObanking
- APY: 4.26%
- Minimum deposit: $1,000
- Early-withdrawal penalty: Six months of simple interest on the amount withdrawn
Details: IGoBanking is the online banking division of New York-based Flushing Bank. The online-only bank offers a robust suite of banking services. The iGoCD, with terms ranging from six months to five years, consistently provides competitive APYs. You can choose to add more money to an iGoCD once it matures or have the money instantly transferred to any other savings account the bank offers.
CIT Bank
- APY: 4.25%
- Minimum deposit: $1,000
- Early-withdrawal penalty: 180 days of interest
Details: CIT Bank is the online division of First Citizens Bank. It’s the largest family-controlled bank in the US. The 18-month CD automatically renews as a two-year CD at the published rate, so customers should ensure that the adjustment best suits their goals. CIT Bank offers a wide selection of deposit accounts, including eight terms of regular CDs and four terms of jumbo CDs. There’s no ATM network with CIT, which is unusual for an online-only bank.
Popular Direct
- APY: 4.25%
- Minimum deposit: $10,000
- Early-withdrawal penalty: 270 days of simple interest
Details: Popular Direct is best for established savers because of the $10,000 minimum deposit requirement to open all CD accounts. This online bank, launched in 2016, offers competitive APYs across eight CD terms for up to five years. Customer service is available 24/7.
Synchrony Bank
- APY: 4.25%
- Minimum deposit: $0
- Early-withdrawal penalty: 180 days of interest
Details: Synchrony Bank is an online-only bank that takes advantage of limited overhead to offer attractive rates for deposit accounts. Transactions can be handled via its website or mobile app. Synchrony Bank has 11 types of CDs, including accounts such as bump-up and no-penalty that provide more flexibility. Customers can also set up CD ladders, which allow you to connect a series of CD accounts of varying terms to provide greater access to the deposits.
First Internet Bank
- APY: 4.23%
- Minimum deposit: $1,000
- Early-withdrawal penalty: 180 days of interest
Details: First Internet Bank launched in 1999 as the first online-only bank in the US. Its high-yield CDs have terms that range from three months to five years. All CDs can be opened with a $1,000 initial deposit and have consistently offered rates at the top of the market.
Marcus
- APY: 4.15%
- Minimum deposit: $500
- Early-withdrawal penalty: 270 days of simple interest
Details: Marcus by Goldman Sachs is the online banking arm of the New York-based multinational investment bank and financial services firm. While this is the seventh largest US bank, all deposits must be electronically transferred using its mobile app because there are no branches or ATMs available. Marcus offers nine, fixed-rate CDs with competitive yields and three no-penalty CDs.
FAQs
Why should I get an 18-month CD?
A certificate of deposit is a savings product that offers higher rates of interest than traditional savings or money market accounts in exchange for agreeing not to access the funds for a fixed period of time before the maturity date. You should purchase an 18-month CD if you want to earn a higher rate of interest and can allow the money to remain untouched for at least 18 months.
How should I choose an 18-month CD?
There are several factors involved in choosing a CD to best suit your financial needs. First, understanding the variety of CD types will help you decide what works best. Traditional CDs offer fixed terms from three months to five years, generally have strict maturity dates and don’t allow you to modify the initial deposit after opening.
Compare the interest rate and annual percentage yield to find the highest paying options. Then determine if there’s a minimum deposit required. Finally, you’ll need to understand if the CD offers an automatic renewal process only or lets you opt out to manage that process manually. In some cases, a CD will also allow you to determine when interest is disbursed.
How are the fees and penalties associated with 18-month CDs?
Fees vary depending on the institution. Most CDs charge a penalty for withdrawing money before the maturity date has passed. For example, a customer may forfeit 180 days (six months) of interest earned on an 18-month CD if the money is withdrawn before the account reaches its maturity date.
Can I lose money purchasing an 18-month CD?
Unless you are purchasing a CD offered by a brokerage account, CDs purchased through a bank or credit union are insured by the FDIC or NCUA for up to $250,000 per person. Any interest compounded is also covered by the insurance, making it a low-risk investment.
Fees incurred because of early withdrawal penalties can reduce the amount of gains earned on a CD. It’s important to make sure that money used to purchase a CD can remain untouched for the duration of the CD term.
What are alternatives to an 18-month CD?
CDs can be purchased in terms ranging from one month to 10 years, although many banks and credit unions offer terms between three months and five years. Generally, CDs with longer terms of maturity pay higher interest rates. Additionally, there are other safe savings accounts to consider such as high yield savings accounts and I bonds.
Methodology
CNET reviews CD rates based on the latest APY information from issuer websites. We evaluated CD rates from more than 50 banks, credit unions and financial companies. We selected the CDs with the highest APY for 18-month terms from among the organizations we surveyed.
Banks surveyed include: Alliant Credit Union, Ally Bank, America First Credit Union, American Express National Bank, Axos Bank, Bank of America, Bank of the West, Bank5 Connect, Barclays, BMO Harris, Bread Savings, BrioDirect, Capital One, CFG Community Bank, Citizens Access, Colorado Federal Savings Bank, Connexus Credit Union, Consumers Credit Union, Discover Bank, First Internet Bank of Indiana, First Tech Federal Credit Union, FNBO Direct, GO2bank, Golden 1 Credit Union, HSBC Bank, Huntington Bank, Lake Michigan Credit Union, LendingClub Bank, Live Oak Bank, M&T Bank, Marcus by Goldman Sachs, Merrick Bank, Nationwide (by Axos), Navy Federal Credit Union, NBKC, OneUnited Bank, Pentagon Federal Credit Union, PNC, Popular Direct, PurePoint Financial, Quontic Bank, Rising Bank, Salem Five Direct, Sallie Mae Bank, Santander Bank, Synchrony Bank, TAB Bank, TD Bank, TIAA Bank, Truist Bank, U.S. Bank, UFB Direct, Union Bank, USAA Bank, Vio Bank and Wells Fargo.
The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.
