A certificate of deposit typically pays a higher yield the longer its term, which can vary from weeks to months to years.

A three-year CD, for example, frequently pays a higher rate than a three-month CD. The trade-off, of course, is that you must leave your money untouched five times longer to earn the higher annual percentage yield (APY) or face a penalty.

What is a 3-year CD?

A three-year CD is a deposit account in which you agree to keep the money in the account for three years. Yields on three-year CDs are often higher than money market account and savings account yields.

Bankrate’s calculator can help you determine how much interest you could earn when your CD matures. Your principal is protected, so you won’t have to worry about fluctuations in value like you might when investing in the stock market. Plus, with a CD, your interest rate is locked in, so you also don’t have to worry about your yield decreasing.

Bankrate’s picks for the top 3-year CD rates

• Randolph-Brooks Federal Credit Union: 4.60% APY, $20,000 minimum to earn APY

• First Internet Bank of Indiana: 4.54% APY, $1,000 minimum deposit

• Bread Financial: 4.50% APY, $1,500 minimum deposit

• Alliant Credit Union: 4.45% APY, $1,000 minimum deposit

• Sallie Mae Bank: 4.40% APY, $2,500 minimum deposit

• Popular Direct: 4.40% APY, $10,000 minimum deposit

• Barclays: 4.30% APY, $0 minimum deposit

• Capital One: 4.30% APY, $0 minimum deposit

• Synchrony Bank: 4.30% APY, $0 minimum deposit

• Marcus by Goldman Sachs: 4.30% APY, $500 minimum deposit

• Quontic Bank: 4.30% APY, $500 minimum deposit

• BMO Harris: 4.30% APY, $1,000 minimum deposit*

• Discover Bank: 4.30% APY, $2,500 minimum deposit

Note: Annual percentage yields (APYs) shown are as of March 17, 2023. Bankrate’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.

*Rate not available in Arizona, Florida, Illinois, Indiana, Kansas, Minnesota, Missouri and Wisconsin.

Today’s top, widely available three-year CD pays 4.60 percent APY — higher than some of the best four-year CD rates. A CD that matures in three years could be a good investment for midterm financial obligations, like a down payment on a car.

A closer look at the top 3-year CD rates

Randolph-Brooks Federal Credit Union: 4.60% APY; $20,000 minimum to earn APY

Randolph-Brooks Federal Credit Union is headquartered in Live Oak, Texas, and operates more than 60 branches serving four major markets in the state: Austin, Corpus Christi, Dallas-Fort Worth and San Antonio. It has more than 1 million members.

Randolph-Brooks Federal Credit Union has CDs with terms ranging from six months to seven years. It also offers a Really Free Checking account that requires no minimum balance and charges no monthly fee.

First Internet Bank of Indiana: 4.54% APY, $1,000 minimum deposit

First Internet Bank of Indiana is an FDIC-insured financial institution that operates online and has no branches. It opened in 1999 and offers products in all 50 states.

First Internet Bank offers eight terms of CDs, a money market savings account with a competitive yield, a savings account and two checking accounts.

Bread Financial: 4.50% APY, $1,500 minimum deposit

Bread Financial, formerly Comenity Direct, is an online bank that offers a high-yield savings account and five terms of CDs ranging from one year to five years.

Bread Financial is part of Comenity Capital Bank, which is a unit of Bread Financial.

Alliant Credit Union: 4.45% APY, $1,000 minimum deposit

Alliant Credit Union was founded in 1935 as the United Airlines Employees’ Credit Union. It is one of the largest credit unions in Illinois and has 600,000 members nationwide.

Alliant offers six terms of CDs with competitive APYs and a reasonable minimum deposit requirement.  It also offers IRA CDs, a high-yield savings account and a high-yield checking account.

Sallie Mae Bank: 4.40% APY, $2,500 minimum deposit

Sallie Mae Bank offers 11 terms of CDs, as well as a savings account and a money market account with no minimum balance requirements or monthly fees. All of these products offer competitive yields.

Sallie Mae Bank was established in 2005 and has its headquarters in Salt Lake City. In 2014, Sallie Mae became a stand-alone consumer banking business.

Popular Direct: 4.40% APY, $10,000 minimum deposit

Popular Direct CDs require a minimum $10,000 deposit, making them best suited to established savers. The CDs come in terms ranging from 30 days to six years.

Popular Direct’s High-Rise savings account offers a competitive yield and requires a $5,000 minimum deposit.

Barclays: 4.30% APY; $0 minimum deposit

Barclays was founded in London more than 300 years ago. Barclays has no minimum balance requirements to open an online CD. It offers six CD terms ranging from one year to five years. A savings account is also available.

Capital One: 4.30% APY, $0 minimum opening deposit

Capital One is an online bank that also has a brick-and-mortar presence, with around 300 branches and about 50 Capital One cafes.

It offers nine competitive terms of regular CDs. Capital One CDs and its 360 Performance Savings account don’t have minimum balance requirements. Capital One is based in McLean, Virginia.

Synchrony Bank: 4.30% APY, $0 minimum deposit

Synchrony Bank offers competitive CD yields across 14 terms, including 10 terms that are less than two years. An 11-month no-penalty CD and a two-year bump-up CD are also available.

The bank also offers a savings account and a money market account. The savings account features a competitive APY and has no minimum balance requirement.

Marcus by Goldman Sachs: 4.30% APY; $500 minimum deposit to open

Marcus by Goldman Sachs is an online bank known for offering CDs and a savings account. It also used to be known for its personal loans, but it no longer offers those.  Not many banks can match the number of CDs that Marcus offers. It has nine terms of regular CDs — ranging from six months to six years — three no-penalty CDs and a rate bump CD. All of these CDs have a $500 minimum deposit requirement.

Quontic Bank: 4.30% APY, $500 minimum deposit

Quontic Bank was established in 2005 and is based in New York. It offers five terms of CDs, ranging from six months to five years, which can be opened with as little as $500.

In addition to its CDs, Quontic Bank also offers money market, high-yield savings and checking accounts.

BMO Harris: 4.30% APY, $1,000 minimum deposit

BMO Harris offers online accounts and operates more than 500 branches in Arizona, Florida, Illinois, Indiana, Kansas, Minnesota, Missouri and Wisconsin. The bank is based in Chicago.

BMO Harris offers 10 CD terms ranging from three months to five years, each requiring a minimum $1,000 deposit to open. It also offers several CD specials with very competitive rates. The competitive rates offered on CDs with terms six months and longer are unavailable to residents of states where BMO has branches.

Discover Bank: 4.30% APY; $2,500 minimum deposit to open

Few well-known banks offer 10-year CDs. One exception is Discover Bank, which offers CDs across all standard terms. The bank’s yields for its five-, seven- and 10-year CDs are the same, and they’re higher than the rates tied to the rest of its accounts.

Discover is an online bank headquartered in Greenwood, Delaware. Until August 2000, it was known as the Greenwood Trust Co., which was incorporated in 1911.

How to find the best 3-year CD rates

Include online banks, credit unions and other banks in your search to find the best three-year CD rates. Many savers tend to stick with the same bank that provides their checking account. But that can be a mistake, especially at large national banks, where deposit rates tend to fall well short of what some smaller institutions offer.

Opening a three-year CD might make sense for people who don’t need access to their money for at least three years. As a result, these accounts are ideal for midterm goals, like setting aside money for a car down payment. Getting a three-year CD could also be a good idea if you’re planning to build a CD ladder.

Search for the best three-year CD rates online and compare your options. If you’re looking for a higher yield, consider some of the lesser-known institutions willing to offer good interest rates to attract depositors.

3-year CD FAQs

• Can you withdraw cash early?

  
  

  When putting money into CDs, it’s important to read the fine print. After all, CDs come with restrictions dictating when you can withdraw your money.
  
  In most cases, you’re not allowed to get your cash before the CD matures. With a three-year CD, that means keeping your money in the account for three years. If you do withdraw the money, there’s a good chance you’ll have to pay a penalty. The penalty depends on the financial institution, and can vary widely. A penalty might be expressed as a certain number of months’ worth of interest or as a percentage of the principal. In some cases, that percentage of principal might be based on the entire amount in the CD, or it might only apply to the amount you withdraw early.
  
  If you’re unsure that you can keep your money in the account for three years, consider other options. There are no-penalty CDs that won’t charge you for taking the money out early. However, no-penalty CDs often come with lower interest rates than those on conventional CDs.
  
  Additionally, you can choose a six-month or one-year CD, instead of getting a three-year CD. You’ll be able to access your money earlier, but you’ll earn a lower yield.

• 3-year CD rate vs. other CD terms

  
  

  A three-year CD rate often comes with a higher interest rate than CDs with shorter terms.
  
  Also, because there are liquidity restrictions on a CD, you’ll often see a higher yield on a CD than what you’d get with a traditional savings account or money market account, though savings and money market accounts provide easier access to your money.
  
  Also, while a three-year CD can feature a higher interest rate than shorter-term CDs and liquid savings accounts, it often has a lower yield than what you’d see if you were willing to tie up your money for a longer term. For example, you might get a higher yield on a five-year CD than what’s available for a three-year CD.
  
  Carefully consider your needs before putting your money in a CD. Be realistic about when you might need the money, based on your short- and medium-term financial goals. Knowing your needs will help you make a better decision about the type of account that’s best for your money.

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Methodology for Bankrate’s Best CD Rates

At Bankrate, we strive to help you make smarter financial decisions. We follow strict guidelines to ensure that our editorial content is unbiased and not influenced by advertisers. Our editorial team receives no direct compensation from advertisers and our content is thoroughly fact-checked to ensure accuracy.

Bankrate regularly surveys around 70 widely available financial institutions, made up of the biggest banks and credit unions, as well as a number of popular online banks.

To find the best CDs, our editorial team analyzes various factors, such as: APY, the minimum deposit needed to earn that APY (or to open the CD) and whether it is broadly available. All of the accounts on this page are insured by the Federal Deposit Insurance Corp. (FDIC) or the National Credit Union Administration (NCUA).

When selecting the best CD for you, consider the purpose of the money and when you’ll need access to these funds to help you avoid early withdrawal penalties.

Banks we monitor

These financial institutions are featured in our CD rate research: Alliant Credit Union, Ally Bank, Amerant Bank, America First Credit Union, American Express National Bank, Axos Bank, Bank5 Connect, Bank of America, Bank of the West, Barclays, Bask Bank, BB&T, BECU (Boeing Employees Credit Union), Bethpage Federal Credit Union, BMO Harris Bank, Bread Financial (formerly Comenity Direct), BrioDirect, Capital One Bank, Chase Bank, CIBC USA, CIT Bank, Citibank, Citizens, Citizens Bank (Rhode Island), Comerica Bank, Customers Bank, Delta Community Credit Union, Discover Bank, Emigrant Direct, Fifth Third Bank, First Citizens Bank, First Internet Bank, First Technology Federal Credit Union, FNBO Direct, Golden 1 Credit Union, Marcus by Goldman Sachs, Morgan Stanley Private Bank, Huntington National Bank, Investors Bank, Investors eAccess, KeyBank, Limelight Bank, Live Oak Bank, M&T Bank, MySavingsDirect, Navy Federal Credit Union, NBKC Bank, PenFed Credit Union, PNC Bank, Popular Direct, PurePoint Financial, Quontic Bank, Randolph-Brooks Federal Credit Union, Regions Bank, Salem Five Direct, Sallie Mae Bank, Santander Bank, SchoolsFirst Federal Credit Union, Security Service Federal Credit Union, State Employees’ Credit Union, Suncoast Credit Union, Suntrust Bank, Synchrony Bank, TD Bank, TIAA Bank, UFB Direct, Union Bank (California), U.S. Bank, USAA Bank, Vio Bank, VyStar Credit Union, Wells Fargo and Zions Bank.