Best 12 Month CD Rates Today: Top Offers for Secure Savings in 2025
One-year certificates of deposit offer a balance between yield and liquidity, making them ideal for savers who want better returns than regular savings accounts but don’t want to lock up funds for extended periods. As of March 2025, the national average for 12-month CDs stands at 3.25% APY, but several financial institutions offer significantly higher rates. These short-term CDs provide predictable returns and FDIC insurance up to $250,000 per depositor, per institution.
Understanding 12-Month CD Basics
Before comparing specific offers, it’s essential to understand how 12-month CDs work. These time deposits require you to keep funds with the bank for the full term to earn the advertised yield. Early withdrawals typically incur penalties, usually amounting to several months’ worth of interest. The interest rate remains fixed for the entire term, protecting against rate decreases while potentially missing out if rates rise.
Key Factors When Choosing a CD
- Annual Percentage Yield (APY): The actual rate of return accounting for compounding
- Minimum deposit requirements: Ranging from $0 to $25,000 or more
- Early withdrawal penalties: Typically 3-6 months of interest
- Compounding frequency: Daily, monthly, or at maturity
- Automatic renewal policies: What happens when the CD matures
Top 12-Month CD Offers for March 2025
The following table compares the best available 12-month CD rates from reputable financial institutions. All listed banks are FDIC-insured, ensuring the safety of deposits up to the maximum allowed limit.
| Financial Institution | APY | Minimum Deposit | Early Withdrawal Penalty |
|---|---|---|---|
| Marcus by Goldman Sachs | 5.05% | $500 | 90 days interest |
| Ally Bank | 4.95% | $0 | 60 days interest |
| Synchrony Bank | 4.90% | $2,000 | 90 days interest |
| Discover Bank | 4.85% | $2,500 | 90 days interest |
| Capital One | 4.80% | $0 | 3 months interest |
Online Banks vs. Traditional Banks
Online banks consistently offer higher CD rates than traditional brick-and-mortar institutions due to lower overhead costs. For example, while major national banks might offer 12-month CDs around 2.50% APY, online competitors frequently provide rates above 4.50%. This significant difference can translate to hundreds of dollars in additional interest over the CD’s term, especially for larger deposits.
Special Considerations
Some institutions offer promotional CDs with higher rates for limited periods or for specific customer segments. Credit unions, which are NCUA-insured rather than FDIC-insured, sometimes provide competitive rates to members. Additionally, jumbo CDs (typically $100,000 or more) may offer slightly higher yields, though the difference is often marginal compared to standard CDs in the current rate environment.
Strategies for Maximizing CD Returns
Savers can employ several strategies to optimize their CD investments. Laddering CDs by purchasing multiple certificates with staggered maturity dates provides regular access to funds while maintaining higher overall yields. Another approach involves monitoring rate trends and considering no-penalty CDs if anticipating potential rate increases. Some investors allocate portions of their emergency funds to CDs while maintaining immediate access to some liquid assets.
Future Rate Outlook
Economic forecasts suggest potential rate stabilization in 2025, making current high-yield CD offers particularly attractive. The Federal Reserve’s monetary policy decisions will continue influencing CD rates, though the fixed nature of these products protects investors from subsequent rate decreases during their term.
For current rate information and account opening, visit the official websites of Marcus by Goldman Sachs , Ally Bank , and Synchrony Bank .