Best 18-Month CD Rates for July 2023

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USAlliance Financial – 5.70% APY

Term (months): 18
Minimum deposit: $500
Early-withdrawal penalty: 12 months of interest
Membership: Anyone can join USAlliance by agreeing to a free membership in the nonprofit American Consumer Council and keeping at least $1 in a savings account.

NASA Federal Credit Union – 5.45% APY

Term (months): 15
Minimum deposit: $10,000
Early-withdrawal penalty: All interest up to 6 months' worth
Membership: Anyone can join NASA FCU by signing up for a free membership in the National Space Society and holding $5 or more in a savings account.

Bank5 Connect – 5.35% APY

Term (months): 15
Minimum deposit: $500
Early-withdrawal penalty: 6 months of interest
About: Bank5 Connect is the online division of BankFive, a Massachusetts community bank operating since 1855.

Online products are not available in Rhode Island or Massachusetts.

Alabama Credit Union – 5.35% APY

Term (months): 18
Minimum deposit: $500
Early withdrawal penalty: 6 months of interest
Membership: Anyone can join Alabama Credit Union by donating $10 to the Secret Meals Association and keeping $5 or more in a member savings account.

Department of Commerce Federal Credit Union – 5.34% APY*

Term (months): 12-23
Minimum deposit: $25,000
Early-withdrawal penalty: 3 months of interest
Membership: Anyone can join the DCFCU by agreeing to a free membership in the nonprofit American Consumer Council.

*Rates listed in DCFCU's rate charts are 0.10% lower than what's listed here, for a minimum deposit amount of $500. But the fine print indicates that for deposits of $25,000, a 0.10% premium applies.

Citizens State Bank – 5.33% APY

Term (months): 15
Minimum deposit: $10,000
Early-withdrawal penalty: 6 months of interest
Membership: Headquartered in Hudson, Wisconsin, Citizens State Bank dates back to 1904. It has five locations in Wisconsin but also offers online banking nationwide.

Connexus Credit Union – 5.25% APY

Term (months): 15
Minimum deposit: $5,000
Early withdrawal penalty: 6 months of interest
Membership: Anyone can join the credit union by donating $5 to the Connexus Association and holding $5 or more in a savings account.

Langley Federal Credit Union – 5.25% APY

Term (months): 17
Minimum deposit: $500
Early withdrawal penalty: 6 months of interest
About: Anyone can join Langley Federal Credit Union by simply keeping $5 in a member savings account.

Jovia Financial Credit Union – 5.25% APY

Term (months): 18
Minimum deposit: $100
Early withdrawal penalty: 6 months of interest
Membership: Anyone can join Jovia by agreeing to a free membership in the affiliated CrossState Foundation and keeping at least $5 in a savings account.

EFCU Financial – 5.25% APY

Term (months): 18
Minimum deposit: $500
Early withdrawal penalty: 6 months of interest
Membership: Anyone can join EFCU by making a donation of any amount to the EFCU Financial Foundation and keeping at least $5 in a member savings account.

The Federal Savings Bank – 5.25% APY

Term (months): 18
Minimum deposit: $5,000
Early withdrawal penalty: 6 months of interest
About: The Federal Savings Bank is a national bank with a network of over 55,000 ATMs across the U.S. It offers checking and savings accounts, as well as mortgages and loans.

Tampa Bay Federal Credit Union – 5.25% APY

Term (months): 18
Minimum deposit: $10,000
Early withdrawal penalty: 6 months of interest
Membership: Anyone can join TBFCU by joining the Prime Time Club with a one-time fee of $5 and keeping at least $5 in a savings account.

Rising Bank – 5.20% APY

Term (months): 15
Minimum deposit: $1,000
Early withdrawal penalty: 6 months of interest
About: Rising Bank is an Internet-only division of Midwest BankCentre of St. Louis, Mo., established 1906.

Luana Savings Bank – 5.20% APY

Term (months): 17
Minimum deposit: $5,000
Early-withdrawal penalty: 6 months of interest
About: Luana Savings Bank was founded in 1908 in northeastern Iowa, and in addition to operating six Iowa branches, it serves nationwide customers online.

MYSB Direct – 5.20% APY

Term (months): 18
Minimum deposit: $500
Early-withdrawal penalty: All earned interest (3 months minimum)
About: MYSB Direct is the online banking arm of M.Y. Safra Bank, which is headquartered in New York City and operates a single branch there.

Crescent Bank – 5.20% APY

Term (months): 18
Minimum deposit: $1,000
Early-withdrawal penalty: 6 months of interest
About: Founded in 1991, Crescent Bank is primarily an auto loan provider that also offers banking services in the Greater New Orleans area as well as online to customers nationwide.

CommunityWide Federal Credit Union – 5.20% APY

Term (months): 18
Minimum deposit: $1,000
Early withdrawal penalty: Complex formula; refer to disclosures and exercise caution.
Membership: Anyone can join CommunityWide by donating $5 to the credit union's local chapter of Goodwill, the Marine Corps League, or Habitat for Humanity, as well as keeping $5 or more in a savings account.

What Is an 18-Month CD and How Does It Work?

Certificates of deposit are bank or credit union accounts in which you agree to hold your funds on deposit without withdrawals for a prearranged period. Thus, an 18-month CD requires you to keep the funds untouched for a year and a half. In exchange for giving up access to your funds, you will generally be rewarded with a higher interest rate than the bank pays on savings and money market accounts.

When opening a CD, you deposit a lump sum of funds into the account at or above the minimum required deposit for that CD. The funds will then sit in the account for 18 months, earning interest along the way. When the CD hits its maturity date, you can take the funds plus their earned interest out of the account with no penalty. Alternatively, you can keep the funds on deposit and roll them into a new CD.

Key Takeaways

Opening a CD account means you agree to keep your funds on deposit without withdrawals until the established maturity date of the certificate.
In exchange, the financial institution will pay you an established interest rate that provides an earnings boost over what its savings and money market accounts pay.
By shopping around for the best rates and choosing a top-paying CD, you can earn many times the national average interest rate.
If you need to withdraw your funds early, it's not impossible. It just means you'll be charged an early-withdrawal penalty, so consider an institution's penalty calculation before making your final CD choice.

When Is an 18-Month CD a Good Choice?

An 18-month CD is a suitable option for money you won't need in the coming year or longer. For those with a specific plan for the money, such as a down payment on a house or paying college tuition bills for a child, an 18-month CD might provide just the time frame you need to keep funds safe and reliably earning interest.

Another appeal of 18-month CDs is to provide one rung of a shortened CD ladder. A CD ladder is a strategy for investing your funds in five CDs of differing terms rather than all at once. For a yearly ladder, you would own a one-year, two-year, three-year, four-year, and five-year CD. But you can also create a shorter ladder, with six-month increments between the CDs (e.g., six-month, 12-month, 18-month, etc.).

Why Do Shorter CDs Sometimes Pay More Than Longer CDs?

Generally speaking, the shorter the CD term, the lower the interest rate paid by the bank, and vice versa. That's because the bank recognizes you need to be rewarded more substantially the longer you're being asked to leave the money on deposit.

However, not all institutions use a perfectly linear scale of interest rates that increase with the CD terms. A common strategy is offering one or more special or promotional CDs that pay a significantly higher interest rate to entice customers to the institution. And to limit how long the bank is paying the boosted rate, promotional CDs are often shorter in duration, such as less than two years.

Important

Though consumers tend to think about CD maturity terms in nice round numbers, be sure to consider odd-term CDs, such as 15-month, 18-month, or 21-month certificates. It's not uncommon for a promotional rate CD to have an odd length, so don't limit yourself to only the conventional terms.

Are Online Bank CDs Safe?

Many of the highest deposit rates, whether for CDs, savings accounts, or money market accounts, are offered by online banks. Some of these are online-only banks, meaning they operate solely on the Internet, while others are brick-and-mortar banks with a separate online banking arm.

Though it may seem scarier to deposit your funds into an Internet bank instead of at a physical branch, online accounts and institutions are just as safe as their more traditional counterparts. That's because FDIC insurance doesn't discriminate—the $250,000 in deposit insurance it provides to consumers in case of bank failure applies just the same to online banks as it does to physical banks.

What if I Need My Money Before the CD Matures?

When you open a CD, you know the precise date that the funds will be ready for penalty-free withdrawal. But sometimes, emergencies crop up, or your financial situation changes, and you need funds from your CD. The good news is that you can almost always withdraw the money at any time.

The catch is that doing so before maturity will trigger the institution's early-withdrawal penalty. Each bank and credit union has a policy for how that penalty is calculated, and the most common method is for the bank to keep a certain number of months' worth of interest. For instance, if you break an 18-month CD early, you will typically lose three to six months of the interest you earned.

Rate Collection Methodology Disclosure

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide, and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD's minimum initial deposit must not exceed $25,000.

Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don't meet other eligibility criteria (e.g., you don't live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.

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