Best 6-Month CD Rates for October 2024

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A 6-month certificate of deposit, or CD, can be an excellent vehicle for short-term savings. Unlike in the stock market, your money is safely protected in an FDIC- or NCUA-insured account. You also won’t be tempted to withdraw it early, unless you’re willing to pay a penalty.

Now that the Federal Reserve has started cutting interest rates, finding a good interest rate can help you maximize your savings. Read on to discover the best 6-month CD rates available in October.

Best 6-Month CD Rates

As of Sept. 16, the national average rate for 6-month CDs is 1.82% APY, and the average rate for savings accounts is 0.46%. You can maximize your potential earnings by choosing a CD account that pays more. Here are some of the best six-month CD rates available now:

• Barclays: APY
• BMO Alto: APY
• Vio Bank: APY
• Bask Bank: APY
• First Internet Bank: APY
• Popular Direct: APY
• Live Oak Bank: APY
• Merrick Bank: APY

Best 6-Month CD Rates: Detailed Overview

Take a closer look at the financial institutions offering some of the best annual percentage yields on 6-month CDs.

Barclays

• APY:
• Minimum Deposit: None

Barclays currently offers one of the highest rates for a 6-month CD. It’s a good option for beginner savers since you can open an account with a smaller lump sum.

BMO Alto

• APY:
• Minimum Deposit: None

BMO Alto pays a competitive APY, but your CD automatically renews at a new interest rate when it reaches maturity. If you prefer another option, you can give advance maturity instructions when you open the account.

Vio Bank

• APY:
• Minimum Deposit: $500

Vio Bank compounds interest on its CDs daily, and you can open a CD account online.

Bask Bank

• APY:
• Minimum Deposit: $1,000

Bask Bank CDs renew automatically at the end of the term unless you choose to roll the funds into a different CD account, change the term or withdraw them.

First Internet Bank

• APY:
• Minimum Deposit: $1,000

First Internet Bank’s 6-month CD’s early withdrawal penalty will take 180 days’ worth of interest it earned if you need the money before the term ends.

Popular Direct

• APY:
• Minimum Deposit: $10,000

Popular Direct pays an impressive APY on a six-month CD, but the minimum opening deposit is much higher than average. It does offer extended customer support hours.

Live Oak Bank

• APY:
• Minimum Deposit: $2,500

Live Oak Bank’s 6-month CD offers an APY that’s more than double what you’d get with the bank’s CD accounts with terms of 24 months and longer. It will automatically renew at the current interest rate if you don’t withdraw the funds within 10 days of the maturity date.

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Merrick Bank

• APY:
• Minimum Deposit: $25,000

Merrick Bank requires an exceptionally high opening deposit, but instead of only crediting the interest to your account, you also have the option to have the interest sent to you via ACH transfer each month.

Benefits of Investing in a 6-Month CD

• Safety and security. When you tuck your funds into an insured CD, you aren’t risking a loss of those funds. If you are looking for a secure way to grow your funds, a CD offers a worthwhile option.
• Higher interest rates. As of writing, interest rates for short-term CDs are still relatively attractive. You can lock in a high rate to grow your savings over the long term.
• Predictable returns. You won’t have to wonder how your funds will grow. Instead, your funds will grow at a predetermined pace for the duration of the term. This makes it easier to plan ahead.

Drawbacks of Investing in a 6-Month CD

• Limited liquidity. You cannot tap into the funds within your CD unless you are willing to pay an early withdrawal penalty.
• Early withdrawal penalties. Steep early withdrawal penalties can cut into your potential earnings if you have to use the funds.
• Potential opportunity cost. If you tuck your funds in a CD instead of investing in stocks, you could miss out on bigger returns.

How To Maximize Your Earnings With a 6-Month CD

If you want to make the most of your CD earnings, consider the following strategies.

• Laddering strategy. A CD ladder involves opening CDs with various terms. For example, you might open CDs with terms of six months, 12 months and two years. The goal is to spread out your funds to lock in relatively high rates over the long term.
• Reinvesting interest. When your CD matures, consider putting both your initial funds and the interest you earned into a new CD. This strategy will help you grow your funds over the long term.
• Watch the early withdrawal penalties. When you are opening a CD, make sure to consider the early withdrawal penalties attached to your CD. Do your best to avoid digging into your CD funds early.

6-Month CDs vs. Other Short-Term Savings Options

A 6-month CD isn’t the only way to save for the future. Below is a look at some of the alternatives to consider.

High-Yield Savings Accounts

Putting your money in a CD means you won’t be able to access it without paying a penalty. If you know you’ll need the money before the end of the term, a high-yield savings account may be a better option, since both types of accounts tend to offer higher yields than you find on regular savings accounts.

A six-month CD has an advantage if you’re saving for a specific purpose, like a vacation or down payment, as long as you can get a higher rate than a high-yield savings account. Investing money in the stock market for such a short period of time may be too risky, and the CD’s withdrawal penalty should make you think twice before you cash it in for an impulse purchase.

Money Market Accounts

Money market accounts are usually a higher-yielding option than standard savings accounts, and rates at some banks and credit unions are competitive with rates on CDs and high-yield savings accounts. Vio Bank, for example, currently pays money market account holders APY on their balance.

One benefit that’s unique to money market accounts is that you can write checks against your balance, and you’ll likely have a debit card as well. While some banks restrict the number of checks you can write, a money market account can be a good alternative to separate savings and checking accounts for those who mostly access their money via ATM withdrawals, which are usually unrestricted. Unlike a CD, a money market account won’t tie up your money for months at a time.

Treasury Bills

Treasury bills, sometimes called T-bills, offer a way to earn a predetermined return over a set period of time. In general, T-bills are considered a safe investment because they are backed by the U.S. government.

At tax time, treasury bills are exempt from state income taxes. But the interest earned on a CD isn’t exempt from either federal or state income taxes. Consider discussing the differences with your tax professional to determine which is better for your situation.

Steps To Open a 6-Month CD

If you are ready to open a six-month CD, use the following steps as a guide.

1. Choose the Right Bank

The process starts by researching your CD options to find the right fit for your situation. Of course, the APY attached to the CD is a key consideration. But other details to consider include the early withdrawal penalties and the accessibility of the financial institution. For example, some of the best rates are available through credit unions, which have limited membership eligibility. Seek out an option that best suits your situation.

2. Set Up Your Account

When you find a CD that suits your needs, it’s time to set up your account. Generally, you’ll be expected to provide the following details during the application process:

• Name
• Address
• Contact information
• Social Security number
• Email
• Phone number

3. Fund Your CD

After your account is approved, it’s time to fund your CD. You’ll need to tuck away at least the minimum deposit requirements into your CD. You can usually do this by providing funding account information for an electronic transfer. But some financial institutions allow you to fund a CD with a physical check.

What Is the Current Yield on a 6-Month CD?

Every bank and credit union sets its own CD yields. The national average is 1.81%, but as this list shows, some financial institutions pay much more. You’ll usually find the best rates at online banks and credit unions.

How Much Can You Earn on a 6-Month CD?

The amount you can earn on a 6-month CD depends on how much you deposit, the APY your deposit earns and how often the interest compounds. For example, if you deposit $1,000 in a 6-month CD with a 5.00% APY that compounds daily, you’ll earn $25.31 by the end of the term. If the interest compounds monthly, the CD will earn $25.26.

By comparison, depositing $1,000 in a 6-month CD with an APY of 3.75% will yield $18.57.

Final Take

If you don’t need access to your money for six months, locking in a rate with a 6-month CD may be a smart choice — as long as you meet the financial institution’s requirements to earn the top rate. To maximize your earnings, look for a CD account that pays a higher APY than you’ll find in a high-yield savings account, and compare the rate with CDs with slightly shorter and longer terms.

Compare CD Rates

• Best 3-Month CD Rates
• Best 6-Month CD Rates
• Best 1-Year CD Rates
• Best 5-Year CD Rates
• Best No-Penalty CD Rates
• Best Jumbo CD Rates
• Best No-Penalty CD Rates
• Best CDs With No Minimum Deposit Requirement
• Best CD Accounts

Sarah Sharkey, Cynthia Measom and Daria Uhlig contributed to the reporting for this article.

Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Oct. 8, 2024.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

GOBankingRates is a personal finance and consumer interest rate website and an online marketing company serving top-tier banks, credit unions and other financial services organizations. Some companies mentioned in this article might be clients of GOBankingRates, which serves more than 100 national, local and online financial institutions. Rankings and roundups are completely objective, and no institution, client or otherwise, paid for inclusion or specific placement. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by the companies included in the article. All fees and rates are subject to change at the issuers’ discretion. Some interest rates might be short-term or promotional offers only, and it is possible additional terms and conditions must be met to obtain the interest rates listed. Rates and availability might vary by region. Verify terms and conditions before opening an account.

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