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7% CDs: Where To Find Them

  • Banks and credit unions are not currently offering 7% CDs, but many high-yield CDs with rates from 5% to 6% or higher are available.
  • Two Californian credit unions offer special CDs with rates of 9.5% APY and 6.5% APY.
  • Financial institutions set CD APYs based on the benchmark rates set by the Federal Reserve.
  • Credit unions and some online banks typically offer the best CD rates.
  • Alternatives to 7% CDs include high-yield savings accounts, money market accounts and bonds.
Advertiser Disclosure

Bask Bank 6-month CD

FDIC Insured
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APY
disclosure
apy
Term Length
6 months
Minimum Opening Deposit
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Why We Like It

Editor's take

The Bask Bank six-month CD is a great option if you want a short-term investment with a competitive interest rate. Interest compounds daily, which helps your money grow faster than with many other CDs that compound less often. Plus, you have 10 business days to fund your account after opening, so you don’t need to deposit immediately.

When the CD matures, you have a 10-day period to withdraw your funds, add more money, or switch to another Bask Bank CD. This flexibility is useful if you plan to review your financial situation every six months.

However, the $1,000 minimum deposit means this CD is best for those who can comfortably set aside that amount for six months. If you need to withdraw early, there’s a significant penalty of three months’ worth of interest. So, it’s important to be sure you won’t need access to your funds before the term ends. Additionally, you can’t add more money to the CD once it’s funded, so if you have extra savings later, you’ll need to wait until it matures to make changes.

In short, the Bask Bank six-month CD may be a good fit for you if you’re looking for short-term growth without a long-term commitment, as long as you’re okay with the early withdrawal penalties and funding restrictions.

PROS

  • Competitive APY
  • Interest compounds daily
  • No monthly maintenance fees
  • Insured by the FDIC

CONS

  • $1,000 minimum opening deposit
  • Early withdrawal penalty equal to 3 months of interest

Quontic 6-month CD

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Rates rates_last_updated
APY
disclosure
apy
Term Length
6 months
Minimum Opening Deposit
min_deposit
Why We Like It

Editor's take

The Quontic six-month CD works well for savers who want competitive rates and are comfortable with online banking. With a $500 minimum opening deposit, it’s accessible to many and offers an easy entry into short-term savings.

You’ll get a competitive APY, and the interest earned is compounded daily. Plus, there’s a 10-day grace period after maturity for penalty-free withdrawals, which gives you some flexibility when the CD ends.

One thing to keep in mind is that if you withdraw your money before the six months are up, you’ll lose all the interest earned—a larger penalty than most other banks charge. Quontic is also a digital-only bank, so there are no physical branches or cash deposit options. However, their mobile app, available on iOS and Android, is user-friendly and packed with helpful tools for managing your account.

Overall, the Quontic six-month CD is a practical fit if you want strong rates and don’t mind handling everything online.

PROS

  • No monthly service fee
  • Takes less than 3 minutes to open an account
  • Innovative online tools
  • Insured by the FDIC
  • Accessible minimum deposit

CONS

  • High early withdrawal penalty
  • No physical branch locations
  • Doesn’t accept cash deposits

Sallie Mae 14-month CD

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APY
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Term Length
14 months
Minimum Opening Deposit
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Why We Like It

Editor's take

The Sallie Mae 14-month CD is a solid choice for you if you want good returns on a relatively short investment. Interest is compounded daily, which helps your savings grow more over time.

With a minimum opening deposit of just $1, this CD is accessible for almost anyone. However, if you need to withdraw your money before the term ends, keep in mind that there’s a penalty equal to 180 days of interest, which could reduce your overall earnings.

The CD also automatically renews, so you don’t have to do anything to keep your investment going. Just remember that the interest rate and terms may change upon renewal, so it’s wise to review those details as your maturity date approaches.

In summary, the Sallie Mae 14-month CD is a great option for you if you can commit to the full term and don’t need to access your money early.

PROS

  • Competitive rates
  • Automatic renewal option
  • No monthly fees
  • Insured by the FDIC

CONS

  • No physical brances
  • Fee for returned deposits

Valley Direct 6-month CD

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APY
apy
Term Length
6 months
Minimum Opening Deposit
min_deposit
Why We Like It

Editor's take

The Valley Direct six-month CD is an excellent option if you’re looking to boost your returns in a short time. With a competitive interest rate, it offers an appealing incentive for those willing to lock in their funds for six months. The minimum deposit is $500, which makes it accessible to a wide range of investors.

Keep in mind that you must open the CD with “new money,” meaning your funds should come from an external source. Once you open the CD, no additional deposits can be made until maturity, which could limit your flexibility.

The account comes with a maximum deposit limit of $500,000, making it suitable for significant investments. If you need to access your money early, be aware that there’s a penalty equal to 90 days’ interest on the amount withdrawn.

The lack of customer support on weekends might be inconvenient for some users. Additionally, interest is compounded quarterly, which is less frequent than some other CDs that offer monthly or even weekly compounding.

In summary, the Valley Direct 6-Month CD is a practical option if you’re ready to commit your funds for the full term. It’s well-suited for those focusing on short-term, high-yield investing without the need for immediate access to cash.

PROS

  • Competitive APY
  • Accessible minimum deposit
  • No maintenance fees

CONS

  • Must deposit new money
  • Limited customer support
  • Quarterly compounding

Are there any 7% CDs?

Currently, no banks offer 7% interest rate certificates of deposits (CDs). As of October 2024, the best CD rates hover just over 5% APY. However, two California credit unions have special CD offers for new members with high rates of 9.5% APY and 6.5% APY.

California Coast Credit Union

To celebrate its 95th year, California Coast Credit Union is offering a special five-month CD with a 9.5% APY. This celebration CD has a minimum deposit of $500 and a maximum deposit of $3,000. Although it offers one of the best CD rates in California, there are restrictions on who can open this account.

To open a California Coast Credit Union Celebration Certificate, you must be a member of the credit union or have a second account, including one of the following:

You must also use new funds to take advantage of the celebration certificate. If you’re already a member, you can’t use funds already deposited with the credit union. Instead, you must fund the CD with other money.

To become a member of California Coast Credit Union member, you need to live or work in one of the following counties:

Financial Partners Credit Union CD

The second option for a high-paying CD is the Financial Partners Credit Union CD, which offers new members a rate of 6.5% APY. This CD has a term of eight months and isn’t available to existing members.

To be eligible, you must be a new member of the credit union and a resident of one of the following counties or cities:

The Financial Partners Credit Union CD also requires a minimum deposit of $1,000 up to a maximum of $3,000.

If you don’t meet the requirements for one of these CDs, you can find other high-yield CDs from credit unions or banks with an APY of around 5%, depending on your desired term.

Understanding CD interest rates and market fluctuations

CDs offer a fixed interest rate expressed in terms of annual percentage yield (APY). A CD’s APY is how much it will earn over one year, accounting for the effects of compound interest. The stated APY assumes you will not make early withdrawals, resulting in penalties that can significantly reduce your return.

The APY rate is fixed for the CD’s term, varying from a few months to several years. The rate remains unchanged during the term despite what happens in the market. In exchange for a CD’s higher fixed interest rate, you agree not to withdraw the money before the CD matures. 

Compounding interest

Compounding interest contributes significantly to your CD’s earnings, and its frequency makes a difference. When you deposit funds in a CD, you’ll earn interest on both the principal and the interest you earn over time. Compound interest is interest on the interest you’ve already earned.

The compounding frequency depends on the CD’s issuer, but it may be daily, monthly, quarterly, or annually. Most banks and credit unions compound interest daily and credit it monthly, allowing you to earn more interest while your funds remain in the CD account.

Market fluctuations

The Federal Reserve sets benchmark rates for federal funds according to inflation and other factors. Usually, banks and credit unions will follow the rates set by the Federal Reserve for their CD rates. 

On September 18, the Federal Reserve announced they would be lowering the benchmark rates for the first time since March 2020. As a result, the benchmark target rate is 4.75% to 5%.

When inflation is high and unemployment is low, as it has been over the last couple of years, the Federal Reserve increases the benchmark rate to slow inflation and prevent the market from overheating. When inflation falls, the Fed decreases the benchmark rate.

Similarly, banks and credit unions increase interest rates on CDs when the Fed rates are higher and decrease them when the Fed sets lower rates. The good thing about opening a CD is that your rate will be fixed, so you’ll continue earning high rates even if new CDs offer lower APYs.

As the Federal Reserve has announced a lowering of the benchmark rate, now may be the perfect time to lock in a longer-term CD, such as a two-year CD.

Where to look for high-yield CDs

Credit unions typically offer the best rates for CDs, as opposed to banks. Since credit unions are non-profit organizations, they can reinvest their profits back into their members’ savings accounts and CDs, resulting in higher interest rates.

While you can find the best CD rates at a credit union, they will require you to become a member to open a CD account. Qualifying is fairly simple in some cases, but in others, it’s not.

For example, some credit unions, such as the two previously mentioned, require you to live or work in specific counties or cities. Others might only be available to people working for particular industries or public employees. 

When you identify a credit union offering a high-yield CD with a term that appeals to you, check their membership requirements to see if you’re eligible.

Factors to consider when pursuing the highest CD rates

Let’s take a look at some common things to look out for with high-yield CDs.

Early withdrawal penalties

Most financial institutions charge penalties when people withdraw money from CDs before they mature. Unfortunately, these penalties tend to be greater for high-yield CDs. 

The federal government sets a penalty for early withdrawals from CDs found in 12 CFR 1030 (Regulation DD), which is a minimum of seven days’ simple interest. While federal law sets a minimum penalty, it does not set a maximum. Therefore, many financial institutions set higher penalties, meaning you could forfeit up to 90 days interest if you withdraw early.

When opening a CD, make sure to deposit money you can afford to go without during the CD’s term. Early withdrawal penalties can substantially reduce or erase the returns you might expect from investing in a CD.

Fixed vs. adjustable rates

While most banks and credit unions offer fixed APYs for CDs, some issuers offer variable rates. Variable rates fluctuate with the market, meaning you won’t have guaranteed earnings on your deposit. If a high-yield CD has a variable APY, the rate might fall and decrease your earnings along with it.

By contrast, the return on a variable APY CD should also go up if the rates increase. If you think rates will continue rising, you’ll want to check whether a CD sets a ceiling on your APY. However, the Federal Reserve has recently announced the lowering of the benchmark rate.

Federal insurance

When you invest in a high-yield CD, you want your money to be safe. CDs opened with Federal Deposit Insurance Corporation members are insured up to $250,000. Similarly, credit unions that are members of the National Credit Union Association offer CDs insured by that organization up to $250,000.

Check to confirm that the CD’s issuer is a member of the FDIC or NCUA to protect your money against the failure of the financial institution. 

Minimum and maximum deposits

Many high-yield CDs have minimum and maximum deposit requirements. The minimum deposit is how much you’ll have to invest to open the CD up to the set maximum. Once you open a CD, you can’t continue making deposits during its term.

Make sure you can comfortably deposit at least the minimum required amount. If you can afford to invest more, you’ll be limited to the financial institution’s maximum allowed deposit, so take a look at that as well.

Customer limitations

Financial institutions offering high-yield CDs often limit who can purchase them. Credit unions and banks usually offer the best rates to new members or account holders. This is meant to attract new customers. For example, the 6.5% APY certificate offered by Financial Partners Credit Union is only available to new members.

They also might require the money used to fund the CD to be “new money” instead of funds already held by an existing member or account holder. This restriction is designed to attract new deposits to the institution. For example, the Celebration Certificate requires existing members to fund the CD with new money not already deposited at California Coast Credit Union.

Other high-yield options to consider

If you’re unsure whether to open a high-yield CD, here are some other types of savings options instead.

High-yield savings accounts

High-yield savings accounts have much more competitive rates than traditional savings accounts offered by banks. Online banks tend to provide the highest APYs for high-yield savings accounts, but it’s a good idea to compare offers and check for fees that could reduce your earnings. 

Unlike a CD, a high-yield savings account has greater liquidity, meaning you can access your funds if needed. However, the rate will be variable, meaning it can fall if the Fed sets a lower benchmark rate. High-yield savings accounts also offer lower rates than you could earn with a high-yield CD.

Money market accounts

Money market accounts pay higher interest rates than traditional savings accounts but lower rates than high-yield CDs. They have greater liquidity than savings accounts, allowing you to access your money with a debit card or checks. Many money market accounts have a high minimum balance and opening deposit requirement.

Bonds

Bonds are debt securities that the federal government, municipalities and corporations sell. While they are generally low-risk investments, junk bonds sold by corporations are riskier. By contrast, government bonds are low-risk investments. 

Most bonds pay fixed interest every six months, allowing you to enjoy regular earnings. However, some bonds are callable, meaning you can be required to sell them earlier than you want, and bonds tend to decline in value when inflation falls.

FAQs: 7% CDs

Are there CDs that offer 7% APY?

No financial institutions currently offer 7% CDs. However, the California Coast Credit Union provides a five-month CD with a 9.5% APY for eligible new or existing members who fund the account with new money. Several restrictions apply.

Are 7% CDs safe?

All CDs are generally considered safe investments when federally insured banks or credit unions issue them. If you open a CD at such an institution, your money will be protected up to $250,000.

Can you get 6% on a CD?

There are 6% CDs available, including the Financial Partners CD previously mentioned.  Credit unions generally offer the highest rates, and you might need to become a member and meet their membership requirements before you’re eligible.

Can you get 5% on a CD?

Yes, many online banks and credit unions offer CDs with 5% APY.

About the Author

Christy Montour
Christy Montour Personal Finance and Investment

Christy Montour is a seasoned finance writer with extensive experience in explaining a wide range of investment types, retirement accounts, and insurance products. With a background in taxation from law school, Christy possesses a deep knowledge of tax strategies and the tax code. 

Christy has written thousands of blogs for clients on finance and investment topics. She covers a wide range of subjects, from the Offshore Voluntary Disclosure Program to IRS installment plans, offers-in-compromise, tax liens, levies, and criminal tax issues such as tax evasion and fraud. Christy’s expertise allows her to break down complex financial topics into clear, accessible content for her readers.

About the Reviewer

Blake Esken
Blake Esken Los Angeles Times

Blake Esken has over 15 years of experience in product management and has been a member of the Los Angeles Times staff for over five years.

As part of his role at the Los Angeles Times Commerce Team, Blake acts as the in-house reviewer and fact checker for LA Times Compare. He supervises all content for compliance and accuracy and puts to use skills he has honed through years of experience managing high-stakes projects for a range of industry-leading companies.

He has a strong background in data analysis, compliance, and communication, which allows him to support LA Times Compare through fact-checking in an effort to provide up-to-date and factual information across our content.

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