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If you are in the market for certificate of deposit (CD)you may want to consider long term options. Not only are they these secure accountsbut long-term CDs give you the ability to do that lock in today's competitive returns for the coming years.
And that's important in today's interest rate environment.
Thanks to a federal funds rate that remains frozen at one Maximum of 23 years, many deposit accounts offer impressive returns. “Current CD rates have risen most of this year and should be considered for the portfolio,” explains Michael Morgan, president of financial planning firm TBS Retirement Planning. “These rates are between 4% and 5%.”
But, there is a strong argument that suggests that today high yields won't be available for much longer.
The federal funds rate is high because rate hikes are The Federal Reserve's most effective tool to fight inflation. And, with post-COVID-19 inflation rates reaching 9.1%the Fed raised rates several times after the pandemic.
But inflation is cooling. The May inflation rate was 3.3%. This followed Inflation rate of 3.4% in April that followed Inflation rate of 3.5% in March – all of which are significantly lower than the 9.1% rate seen in June 2022. And, if inflation continues to cool, the Fed may cut its federal funds rate, which could lead to lower yields of CD accounts.
Long-term CDs can achieve today's strong returns for some time, regardless of what the Fed does with interest rates in the future. But what are the best long-term CDs to open this June? Find out below.
Set your sights on a CD leader for years to come.
The 16 best long-term CDs to open this June (with rates up to 4.80%)
Open one of the following long-term CDs to lock in some of the strongest rates available today for years to come.
The best 3-year CDs to open this June
- BMO High – 4.60% APY: BMO Alto does not require a minimum deposit to open this account. You will pay a penalty equivalent to 365 days of interest if you withdraw your money early.
- Popular Direct – 4.50% APY: You will need to make a minimum deposit of $10,000 to open this account. You will pay a penalty equivalent to 365 days of interest if you withdraw your money early.
- Quantic Bank – 4.40% APY: You will need to make a minimum deposit of $500 to open this account. You will pay a penalty equivalent to 24 months of interest if you withdraw your money early.
- America First Credit Union – 4.35% APY: You will need to make a minimum deposit of $500 to open this account. You will pay a penalty equal to 180 days of interest or a minimum of $5.00 (whichever is greater) if you withdraw your money early.
- LendingClub – 4.30% APY: You will need to make a minimum deposit of $2,500 to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
- Goldman Sachs Marcus – 4.15% APY: You will need to make a minimum deposit of $500 to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
- Sync Bank – 4.15% APY: Synchrony Bank does not require a minimum deposit to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
- Sallie Mae – 4.00% APY: You will need to make a minimum deposit of $2,500 to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
Open a CD now so you don't miss today's strong returns.
The best 5-year CDs to open this June
- BMO High – 4.80% APY: BMO Alto does not require a minimum deposit to open this account. You will pay a penalty equivalent to 545 days of interest if you withdraw your money early.
- Popular Direct – 4.30% APY: You will need to make a minimum deposit of $10,000 to open this account. You will pay a penalty equivalent to 730 days of interest if you withdraw your money early.
- Quantic Bank – 4.30% APY: You will need to make a minimum deposit of $500 to open this account. You will pay a penalty equivalent to 24 months of interest if you withdraw your money early.
- America First Credit Union – 4.20% APY: You will need to make a minimum deposit of $500 to open this account. You will pay a penalty equal to 180 days of interest or a minimum of $5.00 (whichever is greater) if you withdraw your money early.
- Goldman Sachs Marcus – 4.00% APY: You will need to make a minimum deposit of $500 to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
- LendingClub – 4.00% APY: You will need to make a minimum deposit of $2,500 to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
- Sallie Mae – 4.00% APY: You will need to make a minimum deposit of $2,500 to open this account. You will pay a penalty equivalent to 180 days of interest if you withdraw your money early.
- Sync Bank – 4.00% APY: Synchrony Bank does not require a minimum deposit to open this account. You will pay a penalty equivalent to 365 days of interest if you withdraw your money early.
Set these rates for the next five years today.
The bottom line
Today's leading long-term CDs offer impressive returns. But, these returns may not last long. So now is a compelling time to set your rate for long-term financial success. Open a long-term CD now to do this.
