Best 6-Month CD Rates for December 2024

Benzinga found that the best 6-month CD rate for this month is 4.75% APY by Newtek Bank.

Investing in a Certificate of Deposit (CD) is a wise strategy for generating passive income while providing a sense of security in a low-risk environment. By locking your funds into a CD for a predetermined term, you can benefit from a fixed interest rate that often surpasses the rates offered by traditional savings accounts, making it an ideal choice for building your emergency fund. The recent decision by the Federal Reserve to cut the federal funds rate by 50 basis points may impact the overall interest rate environment, leading banks to gradually adjust their rates. By securing a CD at the current rates, investors can take advantage of guaranteed returns in a fluctuating economic landscape, ensuring their savings work harder for them while maintaining safety.

To optimize your returns, it's essential to compare interest rates from various financial institutions using resources like CD Valet or Benzinga’s top 10 list. These resources can help you find the best 6-month CD rates available, ensuring your money grows safely.

Quick Look at the Best 6-Month CD Rates Today:

• Best for High Yield CD: Newtek Bank – 4.75% APY
• Best for High APY: TotalBank – 4.71% APY
• Best for Minimal Early Withdrawal Penalties: Prime Alliance Bank – 4.65% APY
• Best for Access to 24/7 Support: Popular Direct – 4.61% APY
• Best for Building a CD Ladder: INOVA Federal Credit Union – 4.60% APY
• Best for High Rate CD: DR Bank – 4.55% APY
• Best for Short-term CDs: Bask Bank – 4.45% APY
• Best for Penalty-free CD: Climate First Bank – 4.34% APY
• Best for Up to 4-year CD Terms: Able Banking – 4.30% APY
• Best for Multimillion Dollar Insurance: Sun Canyon Bank – 4.22% APY

Best 6-Month CD Rates

We’ve compiled a list of the best 6-month CD rates for this month and the financial institution where you’ll find them to help you earn interest on your short-term savings.

1. Best for Variable Rate CD: Newtek Bank

Newtek Bank is currently running an offer on its 6-month Certificate of Deposit, allowing investors to earn an annual percentage yield (APY) of 4.75%. The minimum opening deposit required is $2,500. Newtek Bank also offers other CD options with terms ranging from 12 months to 60 months. You can open a Certificate of Deposit account online and in just a matter of minutes.

Why We Picked It: Various CD options help you place your money where it makes the most sense for you at that time. Plus, the high rate of return allows you to grow your savings more.

2. Best for High Yield Options: TotalBank

Earn an annual percentage yield of 4.71% on your 6-month Certificate of Deposit with TotalBank. The catch is you’ll need a minimum of $25,000 to hold in the account. But if you have the money, you’ll earn $588.75 during the term. The maximum you can place in the CD account is $1,000,000.

Why We Picked It: TotalBank is an online-only bank from City National Bank of Florida. It has been in operation since 1970, giving it stability and proving its ability to withstand the test of time.

3. Best for Minimal Early Withdrawal Penalties: Prime Alliance Bank

If you’re unsure when you’ll need your funds but want to place them in a Certificate of Deposit account to help them grow while you wait, a 6-month CD with Prime Alliance is a safe bet. That’s because you only lose 1-month of interest if you withdraw the funds early. That means this can be a short-term place to hold your funds until you potentially need them for large purchases. Plus, you can enjoy an annual percentage yield of 4.65%, with a minimum balance requirement of $500.

Why We Picked It: Prime Alliance Bank's minimal penalties on early withdrawals make It a good choice for short-term funds.

4. Best for Access to 24/7 Support: Popular Direct

Popular Direct is there to help you with a customer service team that is available 24/7. As an arm of Popular Bank, Popular Direct has a rich century-long history. It is one of the largest banks in the United States based on assets. Choose from various CD terms, including a 6-month CD that earns you 4.61% APY. You will need $10,000 to place in the account, though.

Why We Picked It: Terms ranging from 3 to 60 months from a bank committed to its customers make this an attractive option.

5. Best for Building a CD Ladder: INOVA Federal Credit Union

Open an INOVA Federal Credit Union CD account to enjoy 4.60% APY on your 6-month Certificate of Deposit account. You only need to place $200 in the account. You can create a nice CD ladder using INOVA with terms up to six years. A 6-year CD earns you an annual percentage yield of 3.75%. Regardless of your chosen term, the minimum deposit requirement is $200.

Why We Picked It: Get creative with how you invest your savings with varying CD terms. While shorter terms offer higher interest rates, longer terms will help ensure your money is productive for years.

6. Best for High Rate CD: DR Bank

If you’re looking for the best 6-month CD based on high Annual Percentage Yield (APY), DR Bank has it. Earn an annual percentage yield of 4.55% on your 6-month CD even if you only have $500 to invest. In 6 months, you can grow your savings with $11.375 in interest and reinvest that money in another Certificate of Deposit account to keep it growing. 

Why We Picked It: While the bank has two physical locations, you can set up and manage your Certificate of Deposit account entirely through online banking.

7. Best for Short-term CDs: Bask Bank

Get short-term CD accounts from Bask Bank to help your money grow even if you think you’ll need it in a few months. Bask Bank offers CDs as short as three months. Three-month CD can earn you an annual percentage yield of 4.65%, while a six-month CD lets you earn 4.45% APY. You will need a minimum deposit amount of $1,000 within 10 days of opening the account.

Why We Picked It: Options for CD rates from three months to 24 months with rates no less than 3.75% make this an attractive option for managing your money.

8. Best for Penalty-free CD: Climate First Bank

Climate First Bank is an attractive short-term CD option with a minimum deposit of $500 and the option to withdraw your money early without penalties. You can earn 4.34% APY on your account with a personal or business CD. Enjoy CD options with terms, including 6 months, 12 months and 15 months, and select the best money-growing option for your situation.

Why We Picked It: Penalty-free withdrawals make this a unique CD option and help provide access to your funds regardless of the timing.

9. Best for Up to 4-year CD Terms: Able Banking

Earn an annual percentage yield of 4.30% on a 6-month Certificate of Deposit with Able Banking. Or choose from other terms for up to four years. Place various amounts of your emergency fund in CDs with different terms to help it grow while keeping parts of it accessible just in case. You will need $5,000 to meet the minimum deposit requirement and obtain the APY.

Why We Picked It: Build a CD ladder using the various terms available with an Able Banking Certificate of Deposit account.

10. Best for Multimillion Dollar Insurance: Sun Canyon Bank

When you have a large nest egg you want to protect while still earning interest, Sun Canyon Bank is a good option. With Insured Cash Sweep (ICS) and Certificate of Deposit Account Registry Service (CDARS) services, you can get multimillion-dollar protection for your funds while earning as much as 4.22% APY on a 6-month Certificate of Deposit account. Sun Canyon Bank offers CD terms ranging from six months to two years.

Why We Picked It: While most banks only offer Federal Deposit Insurance Corporation (FDIC) insurance for up to $250,000, Sun Canyon Bank can protect millions, making it a safe place to protect your funds.

What Is a 6-Month CD?

A Certificate of Deposit is a financial product that allows you to earn monthly interest and grow your money with passive income. Most CDs come with a fixed interest rate and a set term. A 6-month CD is a CD that you must hold for six months or face penalties for early withdrawals.

CD accounts often range from three months to 10 years. Long-term CDs have lower rates but allow you to lock in that rate for long if you believe interest rates are on their way down. 

Because CD accounts are bank products, they have $250,000 insurance from the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA), meaning your money is protected even if the bank you’ve placed it in fails. 

Pros and Cons of 6-Month CDs

Review these pros and cons before placing your funds in a 6-month Certificate of Deposit to ensure the term is right.

Pros

• Rate lock for six months: While the interest rate on a savings account can fluctuate monthly, the rate on a CD is locked for the full term you select.
• You cannot spend money held in the account: If you’re saving for a specific purchase or toward a goal, placing the funds in a CD account can remove the temptation to spend them.
• Higher interest rate than a savings account: In most circumstances, you’ll earn more savings on the funds you hold in a CD than you will in a traditional bank account.
• Minimal risk: Losing the funds held in a CD account is unlikely. While you’ll be getting nice returns on the funds, no stock market downturn or another outside factor can lead to losing your money if you select an institution with insurance protection from the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA).

Cons

• Early withdrawal penalty: You should make sure you don’t need access to the funds during the 6-month term, or you might pay a penalty for removing the money early. In those circumstances, placing the money in a savings account would have been better because you won’t lose interest once you remove it.
• Must place all funds in the account simultaneously: Most CDs only allow you to add money once at the onset. That means that you can’t add funds as you make them. In contrast, a high-yield savings account allows for ongoing deposits.
• Rates could increase, but your rates are locked: Often, with short-term CD accounts, a locked rate is not bad. However, rates can increase during the term, and you’ll be locked in at the original rates from when you opened the account.
• Such short terms can lead to regrets: When rates go down, you might regret only going with a 6-month CD because your locked rate will be much higher than current market options. That’s one reason why a CD ladder makes sense for many consumers.

How to Find the Best 6-Month CD

You should review your options at many financial institutions to find the best CD rates. The best 6 month CD rates will vary daily as the federal funds rate increases or decreases. While rates are a major factor in determining the best 6-month CD account, consider these other features that could help you open the best account based on your needs.

• Minimum deposit requirements: Each financial institution has its minimum deposit requirements. Many accounts with higher rates require a larger investment.
• Early withdrawal penalties: If you’re unsure when you’ll need the funds, opening an account with no early withdrawal penalties might be a good move. That way, you can ensure that you can get your money without paying penalties. 
• CD type: You can choose from various CD types, including variable CDs, no-penalty CDs, and Individual Retirement Account (IRA) CDs. Look for the financial institution that offers the type you need.
• Membership with a credit union: Some of the best CD rates come from credit unions with specific membership requirements. You might not be able to access those accounts without meeting those requirements.
• FDIC insurance: Before opening a CD account, ensure your bank has FDIC insurance to protect your funds if the bank or credit union suffers financial hardships.

Alternatives to a 6-Month Certificate of Deposit

If you are unsure whether a 6-month CD is right for you, consider these alternatives to grow your savings.

• Longer CDs: A longer CD will offer locked rates for a longer term, which means you can enjoy a fixed rate and not worry about researching new terms in just a few months.
• Shorter CDs: Perhaps you’re in the market for a car or house and want to grow your funds while you shop. A shorter CD might make more sense so you know you won’t pay early withdrawal penalties.
• High-yield savings account: A high-yield savings account might be a better option if you always want access to the funds. While your monthly interest rate will fluctuate, you won’t be stressed about removing the money anytime soon.
• Bonds: You can invest your funds in bonds, such as U.S. Treasury I bonds or a bond mutual fund. T-bills are a way to lend the federal government money for four weeks up to one year.

Grow Your Savings in Just 6 Months

With a 6-month Certificate of Deposit, you can earn good interest on your savings with minimal risk that you’ll need to withdraw the funds early since it is such a short term. While you won’t have a long rate lock period, you can earn nice returns with minimal risk to start earning passive income from your savings.

Frequently Asked Questions