5 Best No-Penalty CD Rates in November 2024: Earn Up to 4.90% APY

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Stashing your money in a savings account can net you a decent return, especially if it's a high-yield savings account. But if you don't need access to the money anytime soon, some banks and credit unions may offer higher interest rates on their certificates of deposit (CD).

Traditional CDs are higher-yielding accounts that come with a catch: To take advantage of the higher, low-risk annual percentage yield (APY), you can't take money from the account until it reaches maturity, which can take anywhere from three months to five years in most cases.

If you take a withdrawal before the account matures, you'll be subject to an early withdrawal penalty, which can amount to several months' worth of interest. Fortunately, no-penalty CDs are on the rise, allowing account holders to take that withdrawal, albeit with some limitations, without a fee.

5 Best No-Penalty CDs

Here are some of the best no-penalty CD rates from both brick-and-mortar and online banks. Note that these rates are all current as of August 2023.

Bank	APY	Maturity	Minimum Deposit	Compounding Period	Open CD
	4.90%	11 months More Info Can withdraw balance, including interest earned, 7 days after funding account.	$1,000	Daily	Open CD
	4.55%	11 months More Info Can withdraw balance, including interest earned, 7 days after funding account.	$0	Daily	Open CD
	4.40%	11 months More Info Can withdraw balance, including interest earned, 6 days after funding account.	$0	Daily	Open CD
	Up to 4.50%	7-13 months More Info Can withdraw balance, including interest earned, 7 days after funding account.	$500	Daily	Open CD
	Up to 3.40%	18-36 months More Info Can make 1 partial withdrawal but must keep at least $1,000 in account.	$2,500	Monthly	Open CD

CIT Bank No-Penalty CD: 4.90% APY

CIT Bank offers one of the most competitive CDs with no early withdrawal penalty on the market. Account holders can earn a 4.90% annual percentage yield by locking up their money for just 11 months. The bank's $1,000 minimum deposit is a bit steep, and there's no way to make an early withdrawal of just a portion of your balance. You also have to wait at least seven days after funding your account before you can touch the money.

But if you don't anticipate needing some of your money over the next 11 months, you'll be hard-pressed to find better CD rates with no early withdrawal penalty.

CIT Bank also offers a checking account, a handful of savings products and mortgage loans.

• Interest rate: 4.90% APY
• Maturity: 11 months
• Compounding period: Daily
• Minimum opening deposit: $1,000
• Withdrawal limitations: You may withdraw the whole balance, including interest earned, beginning seven days after funding the account.

CIT Bank No-Penalty Certificate of Deposit

Open CD

Member FDIC.

• Our Rating 4.5/5 How our ratings work
• Minimum
  Deposit Required$1,000
• 11-Month APY4.90% More Info

  Annual Percentage Yield is accurate as of May 9, 2023. Interest rates for CIT Bank's No-Penalty CD are variable and subject to change at any time without notice.

CIT Bank's No-Penalty CD offers one of the most competitive rates with no early withdrawal penalty on the market. With this account, you can earn a 4.90% APY, and the CD matures in just 11 months, which is shorter than average.

• Overview
• Pros & Cons

Overview

The CIT Bank No-Penalty CD offers a 4.90% APY, which may be ideal for people who want both flexibility and a higher interest rate.

Pros

• Strong APY for a no-penalty CD
• No opening or maintenance fees

Cons

• Relatively high minimum opening balance

Bellco Credit Union Smart Move CD: Up to 3.40% APY

Bellco Credit Union offers a no-penalty CD with four term lengths:

Even the shortest maturity is longer than no-penalty CD rates from other financial institutions on our list. What's more, Bellco's $2,500 minimum deposit is steep. 

That said, the credit union is the only one on our list that allows a partial withdrawal, though you have to leave at least $1,000 in the account until the CD's maturity date. You can also add $100 or more to your account once—most financial institutions don't offer this add-on feature—and you can also bump up to the next rate once during your term.

It's also important to note that Bellco has some membership requirements, which is common for credit unions. To join, you must:

• Live or work in an eligible area in Colorado.
• Have a family member who's a member.
• Work for or be affiliated with an eligible employer or association.
• If you're a Colorado resident, join the Consumers United Association ($5 per year or $25 for a lifetime membership).
• If you're not a Colorado resident, join the Bellco Foundation ($10 minimum donation).

While you have to jump through some extra hoops to join, and the longer-term CDs may not be as appealing, the other benefits the credit union provides could make it worth your while.

• Interest rate: Up to 3.40% APY
• Maturity: 18 to 36 months
• Compounding period: Monthly
• Minimum opening deposit: $2,500
• Withdrawal limitations: You may make one partial fee-free withdrawal during your CD term but must keep at least $1,000 in the account until maturity.

Synchrony Bank No Penalty CD: 4.40% APY

Synchrony Bank offers a variety of CDs and CD rates, though its no-penalty option may be best if you want some flexibility. You'll earn 4.40% APY for locking up your cash for just 11 months, and you can take your whole balance with no early withdrawal penalty starting seven days after you fund the account.

What makes this option better than some of the others with high-yield CDs, though, is that there's no minimum opening deposit, making it accessible to anyone, not just those with a lot of cash.

Synchrony Bank also offers other financial products and services, including online-only savings and money market accounts and credit cards.

• Interest rate: 4.40% APY
• Maturity: 11 months
• Compounding period: Daily
• Minimum opening deposit: $0
• Withdrawal limitations: You may withdraw the whole balance, including interest earned, after six days have elapsed from the date of account funding.

Synchrony No-Penalty CD

Open CD

at Synchrony Bank

• Our Rating 4/5 How our ratings work
• Minimum
  Deposit Required$0
• 11-month APY4.40%

The Synchrony No-Penalty CD is great for people who want an accessible, low-risk way to save money. It offers a competitive APY for its relatively short 11-month term. While you can find no-penalty CDs with higher rates, many require you to deposit $500 or more, whereas Synchrony's No-Penalty CD doesn't have a minimum opening deposit requirement. This makes it a strong option for anyone who wants to earn more on their savings but doesn't have hundreds of extra dollars to deposit.

• Overview
• Pros & Cons

Overview

Synchrony Bank’s No-Penalty CD offers a strong APY for its 11-month term. This CD does not carry a minimum opening deposit requirement, and customers can withdraw their whole balance–plus any interest earned–after the first six days following account opening.

Pros

• No minimum balance requirement
• Relatively short term length
• No penalty to withdraw all funds after the first six days following account funding

Cons

• Only one term length
• Higher rates offered by similar accounts

Ally Bank No Penalty CD: 4.55% APY

Ally Bank offers a great rate on its no-penalty CD, and its rate guarantee could also be a huge plus. If you fund an Ally Bank CD and the interest rate goes up within 10 days, you'll get bumped up to the new rate for your CD type and maturity date. It's also one of the few no-penalty CDs with no minimum opening deposit, and it has a short term of 11 months. Renew your CD at that time, and you'll get a 0.05% loyalty reward.

If you need to access your funds, you can take a full withdrawal on the seventh day after opening your account.

In addition to no-penalty CDs, Ally also offers checking, savings and money market accounts, personal, auto and mortgage loans and an investing platform.

• Interest rate: 4.55% APY
• Maturity: 11 months
• Compounding period: Daily
• Minimum opening deposit: $0
• Withdrawal limitations: You may withdraw the whole balance, including interest earned, beginning seven days after funding the account.

Ally Bank No Penalty Certificate of Deposit

Open CD

at Ally

• Our Rating 5/5 How our ratings work
• Minimum
  Deposit Required$0
• 11-Month APY APY4.55%

With no minimum opening deposit requirement and no early withdrawal penalties, there is a lot to like about Ally Bank's 11-Month No Penalty CD. Its interest rate is competitive with similar no penalty CDs, and even stands up to some regular one-year CDs.

• Overview
• Pros & Cons

Overview

If you’re worried you won’t be able to keep your money in a CD until it reaches maturity, you may want to consider Ally Bank’s No Penalty CD. This CD has no minimum opening deposit requirement, and will give you an interest rate that’s competitive with the best no-penalty CDs on the market.

Pros

• Strong interest rate
• No minimum opening deposit

Cons

• Only one term length

Marcus by Goldman Sachs No-Penalty CD: Up to 4.50%

Marcus is the retail arm of Goldman Sachs, an investment bank. Its CD rates aren't the strongest on our list, but it's also the only one to offer a shorter term than 11 months:

Unfortunately, you have to lock in for 13 months to get the maximum rate. There is a $500 minimum opening deposit, but that's not as much as some other no-penalty CDs we've found. 

In addition to decent CD rates, Marcus by Goldman Sachs also offers high-yield savings accounts, personal loans, credit cards and investment accounts. 

• Interest rate: Up to 4.50% APY
• Maturity: 7 to 13 months
• Compounding period: Daily
• Minimum opening deposit: $500
• Withdrawal limitations: You may withdraw the whole balance, including interest earned, beginning seven days after funding the account.

Pros and Cons of No-Penalty CDs

Pros of No-Penalty CDs

Here's a closer look at the benefits of a no-penalty CD:

• No penalty fee: You won't have to pay a fee if you withdraw funds before the term length ends. Traditional CDs require you to keep your cash in the account for the full term or pay a fee. Read the fine print, though: Some no-penalty CDs have waiting periods and some only allow a partial withdrawal.
• Guaranteed APY: You'll get the same interest rate throughout the term of the CD (unlike with a savings account). This is a nice guarantee if you find a rate you like.

Cons of No-Penalty CDs

Keep these drawbacks in mind when considering a no-penalty CD:

• Lower APYs: Many CDs have lower interest rates than what you'll find with savings accounts or high-yield CDs. But some of the best no-penalty CDs have APYs that rival these account types, so depending where you stash your money, this might not be a problem.
• Can't add funds: Once you've set up your CD, you usually can't continue to deposit funds during the length of the CD. Take time to figure out how much you want to put in the CD in advance so you can maximize your return in a way that works for you.
• Waiting period: Most no-penalty CDs have a waiting period, even if it's just a week or so, before you can withdraw your funds. This isn't a huge drawback but something to keep in mind if you think you'll need fast access to this money.
• Partial withdrawals: Some no-penalty CDs let you withdraw your entire balance without paying a fee, but some require you to leave a balance in the account. Read the fine print on any account you consider so you know if you can make a full or partial withdrawal if needed.

Which No-Penalty CD Should You Choose?

Before you look into CDs, check out other high-yield accounts, including savings accounts and money market accounts, to see if you can get a similar rate without locking up your money for several months. Many banks offer bonuses for new account openings to incentivize new customers. Also check that the bank is FDIC insured so you know your funds are secured. Most banks are considered safe, but it's always a good idea to double check.

If you can't find another high-yield option you like, consider these features when determining which CD is the right fit for you:

• CD rates
• Maturity date
• Opening deposit requirement
• Compounding period
• Full or partial withdrawals
• Restrictions on when you can withdraw
• Ability to renew
• Rate guarantee

In addition to these banks and credit unions, you may also want to consider other CD providers, including CFG Bank, PurePoint, Quontic Bank and more. Keep in mind, though, that not all financial institutions that offer CDs have a no-penalty option.

If you're the type of person who likes to keep all of their financial dealings under one roof, you may also want to check to see what other financial products and services the financial institution offers. 

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Are No-Penalty CDs Worth It?

No-penalty CDs are worth it if you find one with an APY you like and that has the flexibility you need. If you think you'll need to withdraw your funds early, read the rules of the CD and if the restrictions work for you, then a no-penalty CD could be worthwhile.

Typically, a no-penalty CD isn't worth it when you are certain you won't need to touch your funds for the length of the CD term because you can often find a higher APY elsewhere, whether in a traditional CD or a high-yield savings account. A no-penalty CD is also often not worth it if you want to deposit funds from time to time—you'll want a high-yield savings account for that scenario.

FAQs

While certificates of deposit have been around for a long time, they're not as widely used as other banking products. Here are some common questions about CDs and how they work.

• How do no-penalty CDs work?

  No-penalty CDs let you withdraw some or all of your funds early (though they usually have some restrictions you'll want to read before agreeing) without having to pay a fee. They are great for people who think they may need access to their money before their term length ends but also want to lock in a fixed APY.

• How much interest do you get in a certificate of deposit?

  The interest you earn depends on a few factors, including the annual percentage yield, the term of the CD and how often the bank or credit union compounds the interest.

  If you're thinking about getting a CD, search for an online CD interest calculator to get an idea of how much money you can earn during the period.

• What's the catch to no-penalty CDs?

  No-penalty CDs offer you more flexibility than traditional CDs. But no-penalty CD rates tend to be lower than traditional CD rates. Additionally, you may be limited in how you can take the withdrawal to avoid the withdrawal penalty. For example, you may have to wait through a grace period first, or you may be required to withdraw the full amount rather than part of your balance. Make sure you read the fine print before you open an account.

• What is a CD ladder?

  A CD ladder is a savings strategy that involves spreading money across multiple CDs instead of putting all of it into one. That way, you can take advantage of higher yields with long-term CDs without needing to lock up all of your money for a longer period of time.

• Are no-penalty CD funds FDIC insured?

  If you have a no-penalty CD with a bank that's a member of the Federal Deposit Insurance Corporation, then your funds are FDIC Insured. This means that if the bank fails, your funds are insured for up to $250,000 per depositor, per insured bank, per account ownership category. 

  No-penalty CDs offered by federal and state-chartered credit unions are not covered by the FDIC, but they receive the same insurance coverage through the National Credit Union Administration. 

• Are no-penalty CD rates fixed or variable?

  There are both fixed- and variable-rate no-penalty CDs available, but fixed rates are much more common. With a fixed option, your rate stays the same until the CD matures. With a variable rate, it can fluctuate over time.

• Is it a good idea to get a no-penalty CD?

  It can be a good idea to get a no-penalty CD because it gives you more flexibility if you need access to your money over time. Some of the best no-penalty CDs have APYs that rival the rates of traditional CDs that do impose a penalty for withdrawing your money early. It's best to shop around and see what term lengths and interest rates match your needs.

• What is the difference between a high-yield CD and a no-penalty CD?

  The main difference between a high-yield CD and a no-penalty CD is that a no-penalty CD lets you withdraw your funds early without getting hit with a fee, but it may not have the highest APY. High-yield CDs have some of the best rates you'll find. But in exchange, you'll typically have to lock up your funds for the CD's full term length or pay a penalty fee.

  That said, there are some no-penalty CDs with higher APYs, and a few are competitive with the rates you’ll find on high-yield CDs. Since the main benefit of a high-yield CD is the interest rate, research your options and see if one account type is better for you—you might be able to find the best of both words depending on your financial goals.

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