How to Find the Best Jumbo CD Rates: Explore some of the top jumbo CD rates available today.
How to Find the Best Jumbo CD Rates
If you’re seeking a fixed, reliable, and secure return on your savings, consider opening a certificate of deposit (CD), and a jumbo CD might be the ideal choice if you have substantial funds to safeguard.
Over the past year, rates on savings accounts, including 1-year CDs, 3-year CDs, and 5-year CDs, experienced an upward trend as the Federal Reserve addressed inflation by raising interest rates. Jumbo CD rates also saw an increase, with many accounts offering over 5% on deposits. However, as the Fed concludes its rate-hiking efforts, the growth in CD and high-yield savings account rates has tapered off.
At its latest meeting, the Federal Reserve opted to maintain the current interest rates for the fourth consecutive time, holding the federal funds rate within a target range of 5.25% to 5.5%, the highest since 2001. As the Federal Reserve is anticipated to reduce interest rates later this year, savings rates are expected to decline further. Hence, it’s advisable to secure favorable rates while they remain elevated.
What is a jumbo CD?
Depending on the amount of cash you wish to invest, you may be eligible to open a jumbo CD account. A jumbo CD account is essentially the same as a regular CD account, with one key difference — jumbo CD accounts require a higher minimum deposit to open. Typically, most banks stipulate a deposit of $100,000, but this figure varies among different banks.
How to identify the best jumbo CD rates?
To find the optimal jumbo CD rate, you must follow several steps, including selecting the right bank and considering factors that align with your preferences.
- Choose an online bank: Generally, online banks offer more competitive rates compared to traditional banks. If you aim to open one of the top-earning CD accounts available, you may need to opt for an online bank over a brick-and-mortar one.
- Ensure your cash is secure: Confirm that your account is FDIC or NCUA insured to safeguard your money even if your bank or credit union faces challenges. The FDIC protects up to $250,000 in individual deposit accounts, while the NCUA safeguards up to $250,000 per credit union member.
- Compare APY across accounts: While many jumbo CD accounts offer impressive rates, it’s worthwhile to explore other CD accounts with varying deposit requirements and term lengths to potentially find higher yields.
- Choose the right term: If you anticipate needing access to your funds before the CD matures, be aware that withdrawal fees may offset any interest earned unless you have a no-penalty CD. Therefore, when selecting an account, ensure you won’t need to access your cash until the CD reaches maturity.
Here are some of the leading jumbo CD accounts available for various term lengths:
Hughes Federal Credit Union
- APY: 5.65%
- Term: 17 months
- Minimum balance: $99,000
One American Bank
- APY: 5.51%
- Term: 5 months / 11 months
- Minimum balance: $50,000
My eBanc
- APY: 5.51% / 5.45%
- Term: 6 months / 12 months
- Minimum balance: $50,000
Alliant Credit Union
- APY: 5.45%
- Term: 12 months
- Minimum balance: $75,000
State Department Federal Credit Union
- APY: 5.41%
- Term: 15 months
- Minimum balance: $100,000
State Bank of Texas
- APY: 5.40%
- Term: 12 months
- Minimum balance: $50,000
GTE Financial
- APY: 5.38%
- Term: 12 months
- Minimum balance: $100,000
ECFU Financial
- APY: 5.35%
- Term: 6 months / 12 months
- Minimum balance: $100,000
Finworth
- APY: 5.35%
- Term: 14 months
- Minimum balance: $50,000
Bottom line: How to Find the Best Jumbo CD Rates
While jumbo CD accounts necessitate significantly higher deposits than standard CD accounts, they often offer a higher APY. These accounts are a solid option for individuals seeking some of the highest saving rates in the market, providing a guaranteed rate of return on savings without taking on additional risks. Although CD accounts yield comparatively lower returns compared to riskier investment options like stocks or ETFs, they are a preferable choice for those seeking a fixed, predictable, and secure return on their money. Before committing to a jumbo CD account and locking in at least $100,000 for an extended period, carefully consider when you may need access to your cash to avoid hefty withdrawal fees before the account matures.
I hope this article on How to Find the Best Jumbo CD Rates has been helpful. If you have any further questions, please feel free to leave a comment below.