Best 4-Year CD Rates for November 2023

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Wellby Financial – 5.25% APY

Term (months): 48
Minimum deposit: $1,000
Early withdrawal penalty: 12 months of interest
Membership: Anyone is eligible to join the credit union through membership in the American Consumer Council.

Farmers Insurance Federal Credit Union – 5.00% APY

Term (months): 48
Minimum deposit: $1,000
Early withdrawal penalty: Complex formula with a minimum of 6 months of interest
Membership: Anyone is eligible to join the credit union through membership in the American Consumer Council.

Chartway Credit Union – 5.00% APY*

Term (months): 50
Minimum deposit: $500
Early withdrawal penalty: 6 months of interest
Membership: Anyone can join Chartway by donating $10 to the Chartway Promise Foundation and keeping $5 or more in a savings account.

*Published rate is not available to residents of Nevada, North Carolina, Texas, Utah, or Virginia.

Self-Help Federal Credit Union – 4.86% APY

Term (months): 48
Minimum deposit: $500
Early withdrawal penalty: 6 months of interest
Membership: Anyone who lives, works, or worships or attends school in any of the eligible counties (or who has a family or employer affiliation with the credit union) can join Self-Help FCU for free. Otherwise, there's a one-time $5 fee.

First Harvest Credit Union – 4.82% APY

Term (months): 48
Minimum deposit: $1,000
Early withdrawal penalty: 6 months of interest
Membership: Anyone is eligible for membership by agreeing to join the CrossState Credit Union Foundation, and First Harvest will cover the membership fee.

U.S. Senate Federal Credit Union – 4.81% APY

Term (months): 48
Minimum deposit: $1,000
Early withdrawal penalty: 12 months of interest
Membership: Anyone can join USSFCU by agreeing to a free one-year membership in the nonprofit American Consumer Council and keeping at least $5 in a savings account.

First National Bank of America – 4.80% APY

Term (months): 48
Minimum deposit: $1,000
Early-withdrawal penalty: 18 months of interest
About: First National Bank of America is a Michigan-based community bank established in 1955. In addition to three branches in the state, FNBA offers online banking products to customers nationwide.

BMO – 4.75% APY*

Term (months): 45
Minimum deposit: $1,000
Early withdrawal penalty: 18 months of interest
About: BMO is a U.S. subsidiary of the Canadian multinational Bank of Montreal and is one of the 25 largest U.S. banks. In addition to online products, BMO operates branches in eight states.

*This rate may differ for those residing in Arizona, Florida, Illinois, Indiana, Kansas, Minnesota, Missouri, or Wisconsin (i.e., the states where BMO operates physical branches).

iGObanking – 4.75% APY

Term (months): 48
Minimum deposit: $1,000
Early withdrawal penalty: 12 months of interest
About: iGObanking is an online banking division of Flushing Bank, which operates 19 branches in New York state.

Bread Savings – 4.75% APY

Term (months): 48
Minimum deposit: $1,500
Early-withdrawal penalty: 12 months of interest
About: Formerly branded as Comenity Direct, Bread Savings is the online consumer deposits bank operated by credit card issuer Comenity Capital Bank.

Merrick Bank – 4.75% APY

Term (months): 48
Minimum deposit: $25,000
Early-withdrawal penalty: 9 months of interest
About: Primarily a credit card issuer and consumer finance provider, Merrick Bank offers online-only certificates of deposit.

Lafayette Federal Credit Union – 4.73% APY

Term (months): 48
Minimum deposit: $500
Early withdrawal penalty: 16 months of interest
Membership: Anyone can join Lafayette Federal with a $10 membership in the Home Ownership Financial Literacy Council and $50 or more held in a savings account.

Crescent Bank – 4.65% APY

Term (months): 48
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.

Popular Direct – 4.65% APY

Term (months): 48
Minimum deposit: $10,000
Early-withdrawal penalty: 12 months of interest
About: Popular Direct is the online-only arm of Popular Bank, the U.S. banking subsidiary of Popular, Inc., which serves banking customers in the U.S., Puerto Rico, and the Caribbean.

NASA Federal Credit Union – 4.65% APY

Term (months): 49
Minimum deposit: $10,000
Early-withdrawal penalty: 12 months of interest
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.

Pros and Cons of a 4-Year CD

Pros

Guaranteed yield for four years
Entirely predictable earnings
Potentially higher APY than alternatives
Spending deterrent
Safe and virtually risk-free

Cons

Incurs penalty if withdrawn early
Only allows you to make a single deposit
If rates rise, you might wish you'd chosen a shorter CD
If rates drop, you might wish you'd chosen a longer CD
Future rate environment can't be predicted

Pros Explained

Guaranteed yield for four years: A CD's annual percentage yield (APY) is presented to you before you open it, and once you make your deposit, you'll be locking in that return for the full duration of the CD. The bank cannot change the rate.
Entirely predictable earnings: Because you'll know the rate, and because it's locked, you can calculate exactly how much your CD will be worth on its maturity date. Changes in financial markets or other factors in the news will have no bearing on your earnings.
Potentially higher APY than alternatives: In some rate environments, you can earn a higher interest rate the longer you're willing to commit your funds. So when shopping around, check if stretching to a four-year CD can increase your rate.
Spending deterrent: Because you can't make withdrawals from a CD without paying a penalty, you may be dissuaded from spending your savings on unplanned purchases.
Safe and virtually risk-free: If you open your CD at an FDIC-insured bank or NCUA-insured credit union, your CD deposits of up to $250,000 per person and per institution are protected, even if the institution fails.

Cons Explained

Incurs penalty if withdrawn early: If you need to cash out your CD before maturity, you can do so, but you'll be charged an early withdrawal penalty. The amount of that penalty will be spelled out in your CD agreement, which you should review before committing your funds, as penalty policies can vary widely across institutions.
Only allows you to make a single deposit: The vast majority of CDs are designed to take one initial deposit that is kept on hold through the CD's term. Only niche "add-on" CDs offer the ability to deposit additional funds.
If rates rise, you might wish you'd chosen a shorter CD: If you lock in your 4-year CD rate and then rates climb higher, you may wish you had opted for a shorter CD so you could have gotten out of your current rate sooner and opened a new CD at a higher rate.
If rates drop, you might wish you'd chosen a longer CD: If rates go down after you lock in a 4-year CD, you may wish you'd gone for a 5-year term instead, to retain your rate further into the future.
Future rate environment can't be predicted: Only very occasionally is it clear where interest rates are headed. Most of the time, anything is possible months or years down the road, making it difficult to gauge what the best CD moves are at any given time.

Alternatives to a 4-Year CD

Shorter-Term CDs

Opening a certificate with a shorter term may be a better choice if you're not entirely confident you can leave the funds on deposit for a full four years. Also, sometimes you can score a higher rate on a shorter CD than on a longer one. It depends on the current rate environment, and also what promotional CDs might be available in the marketplace.

If you open a shorter-term CD, you can always cash it in when it matures and open a new CD. But you may find that rates have dropped. If rates are now higher, it's great news. But if rates are lower than when you opened your initial CD, you may wish you'd locked in your rate for four years instead of the shorter term.

High-Yield Savings and Money Market Accounts

Keeping your cash in a savings or money market account offers much more flexibility than a CD, with no risk of an early withdrawal penalty. You'll be able to add and withdraw funds more or less as often as you like.

The trade-off, however, is that your interest rate on a liquid account can change at any time. So if rates are declining, the annual percentage yield on your high-yield savings or money market account will almost certainly go down, while any rate on a CD will hold.

In addition, liquid accounts typically don't offer as high a return as CDs. By committing your funds to a certain CD term, you can usually boost your earnings, and sometimes quite substantially.

Bond Products

Various types of bonds are also possibilities for your cash savings. Some, like U.S. Treasury savings bonds and Treasury notes, are very similar to CDs in that the rate is typically predictable if you hold the bond until maturity. They are also backed by the federal government, so like CDs, they are exceptionally safe.

U.S. Treasury I bonds, however, only have a fixed rate for six months at a time. Twice a year, the rate is adjusted based on the current inflation rate (hence the name I bond). Like a CD, I bonds have an early withdrawal penalty, but it's a mild three months' worth of interest. Also, unlike a CD, you cannot for any reason cash in an I bond during its first 12 months.

Other bond options are municipal and corporate bonds of various lengths. But the easiest way for most people to buy these is through a bond mutual fund or bond ETF (exchange-traded fund) that bundles many bonds together. Some of these even include hundreds or thousands of bonds in a certain category, making them an index fund of bonds. By going this route, you can make investments and withdrawals at will, rather than having to be concerned with maturity dates.

When CD shopping, stay open-minded about the maturity term you're seeking. Not only do some institutions offer odd-term CDs with better rates (think 35 months or 49 months), but it's also true that some banks will offer a promotional CD that, despite having a much shorter term, actually offers a higher rate than the term you're looking to open.

The Stock Market

If you know you won't need your funds for four years, you could consider investing in stocks instead. The upside is that you could potentially earn quite a bit more in the stock market than with a fixed four-year CD rate.

The notable downside, of course, is that you can always lose money in the stock market, including scenarios where you lose most of your investment. So while CDs won't return as much as equities in a bullish stock market period, on the flip side they are guaranteed to grow, with no risk of you losing your initial principal.

What Is a 4-Year CD?

A certificate of deposit is a special type of bank account that involves advance commitments from both the individual and the bank or credit union. Your commitment is to hold a lump-sum deposit in the account for a certain period of time, usually measured in months or years. In turn, the financial institution commits to paying you a fixed and known interest rate for the full duration of the CD.

Because the bank can count on having access to the funds for an extended period, it will generally pay you a higher interest rate on your balance than if the funds were in a savings or money market account, where unpredictable withdrawals and deposits are allowed.

A four-year CD is simply a certificate of deposit that has a maturity term of about four years or 48 months, though you'll sometimes encounter CDs with odd terms, such as 45 months or 49 months. Those that qualify for our four-year rankings have terms ranging from 42 to 53 months.

When Is a 4-Year CD a Good Idea?

There are two main reasons to consider a CD that's four years in length. The first is based on your personal timeline. If you know you can lock up the funds for a number of years, but five years is a bit too long because you'll need the funds sooner than that, a four-year term can get you close to those five-year yields while shortening the time until you can access the funds.

The second reason to buy a four-year CD is if you are building a five-year CD ladder. This is explained in more depth below, but in short, it involves buying an array of different CD terms, in yearly durations of up to five years. Hence, you'll need one four-year CD to complete the group.

What If I Need My Money Before Maturity?

You can typically withdraw your money from a CD at just about any time, but it may take up to a week to get your money and it will come at a price.

Since the entire premise of a CD is that the bank is paying you a better interest rate in exchange for your agreement that you'll keep the funds on deposit until maturity, cashing the CD in early means you are breaking your end of the deal. The result is called an early-withdrawal penalty, and like rates, the penalties vary tremendously across institutions.

Most types of penalties make you forfeit some months of earned interest. This can be as few as one month or as long as 24 months. Generally, the longer the CD term, the more months of interest you'll be penalized.

Even worse are early withdrawal policies that calculate the penalty as a percentage of your balance because these can dip into your principal. You should always avoid any CD with a penalty that can reduce your principal.

Be sure to look into the early withdrawal policy for any CD you're considering. If you find yourself trying to decide between two fairly similar CDs, it's wise to go with the one assessing a milder penalty, just in case an emergency arises and you find yourself needing to withdraw.

What Is a CD Ladder?

The term CD ladder refers to a strategy designed to maximize the amount of interest you can earn over a long period of time, while still giving you access to a portion of the funds every year. For a five-year CD ladder, you'll invest one-fifth of the total funds into five different CD durations (e.g., the rungs of the ladder) and eventually use the proceeds of each maturing CD into a five-year CD, since those certificates typically pay the highest rates.

Let's say you want to keep $50,000 invested in safe, reliable CDs for capital preservation. Instead of investing it all in a single five-year CD and having no access to the full amount for that time, you can build a five-year CD ladder by putting $10,000 into a one-year CD, $10,000 into a two-year CD, and so forth, until you have five $10,000 CDs all maturing a year apart.

Each year, when one of the CDs matures, those funds are used to buy a new five-year CD to earn a higher yield and continue the ladder. After the fourth maturity, you'll still have five certificates, but they will now comprise a portfolio of only five-year CDs, with one available for withdrawal every year.

How Do Banks and Credit Unions Differ?

You can open a certificate of deposit at almost any bank or credit union. And for the most part, there is little difference between CDs from these different institution types. Indeed, both banks and credit unions offer the same level of deposit insurance ($250,000 per individual) should the institution fail.

The biggest difference is that opening any account at a credit union requires you to first become a member since credit unions are member-owned not-for-profit organizations. Further, you'll find that the rules of eligibility for membership are unique to each credit union, with some based on where you live, while others are based on where you work.

All of the credit union CDs in our rankings are from credit unions that allow anyone nationwide to join regardless of where you live or work. However, doing so sometimes requires a small donation or fee.

Still, joining a particular credit union can be worth it, as many credit unions make up the top ranks in various CD terms. In particular, the longer the term you're shopping for, the better served you'll be by staying open-minded to a credit union CD.

Methodology

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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