Best 12 Month CD Rates Today: Top Annual Certificate of Deposit Options

By the end of this guide, you will have a comprehensive understanding of how to identify the best 12-month CD rates and select the right financial institution for your needs. Additionally, a comparison table is included to simplify your decision-making process by presenting the top options side by side.

Certificate of Deposits (CDs) are time-bound savings accounts that offer higher interest rates than regular savings accounts in exchange for locking in your funds for a predetermined period. A 12-month CD is particularly popular because it provides a relatively short commitment while still offering a competitive return. Unlike stocks or other volatile investments, CDs are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositor, per institution, making them a safe haven for risk-averse investors.

When selecting a 12-month CD, it is essential to consider factors such as the annual percentage yield (APY), minimum deposit requirements, early withdrawal penalties, and the reputation of the financial institution. Some banks offer promotional rates for new customers, while others provide loyalty bonuses for existing clients. Online banks often have higher APYs compared to traditional brick-and-mortar banks due to lower overhead costs.

Another critical aspect to evaluate is the compounding frequency of the interest. The more frequently interest is compounded, the more you earn over the CD term. Additionally, some institutions offer no-penalty CDs, which allow you to withdraw funds before maturity without incurring a fee, albeit at a lower interest rate. Understanding these nuances can help you choose the best CD for your financial goals.

Top Financial Institutions Offering the Best 12-Month CD Rates

As of March 2025, several banks and credit unions are leading the market with high-yield 12-month CDs. Below is a detailed comparison of the top options, including their APYs, minimum deposit requirements, and other notable features.

Comparison of Best 12-Month CD Rates

Factors to Consider When Choosing a 12-Month CD

While the APY is a crucial factor, it is not the only consideration when selecting a CD. Here are some additional aspects to keep in mind:

• Liquidity Needs: If you anticipate needing access to your funds before the CD matures, look for institutions with lower early withdrawal penalties or no-penalty CDs.
• Minimum Deposit: Some banks require a significant initial deposit, which may not be feasible for all savers.
• Customer Service: Online reviews and customer satisfaction ratings can provide insight into the quality of service offered by the bank.
• Additional Benefits: Some banks offer perks such as relationship bonuses or automatic renewal options.

How to Open a 12-Month CD

Opening a CD is a straightforward process. Most banks allow you to apply online, though some may require you to visit a branch. Here are the general steps:

1. Compare rates and terms from multiple financial institutions.
2. Gather the necessary documentation, such as your Social Security number and a valid ID.
3. Complete the online application or visit a branch.
4. Fund your CD with the required minimum deposit.
5. Monitor your CD's progress through online banking or statements.

For further information, you can visit the official websites of the mentioned banks: Ally Bank , Marcus by Goldman Sachs , Synchrony Bank , Discover Bank , and Capital One.