Saturday, 1 April 2023
Updated on Friday, March 11, 2022
Jumbo certificates of deposit (CDs) offer a cautious way to save large sums of money. Like traditional CDs, jumbo CDs feature a predetermined interest rate and term length, as well as early withdrawal penalties. The key difference is that jumbo CDs require much higher opening minimum deposits: typically, that number is $100,000, but we’ve included some with lower minimums as well.
Below are the best jumbo CD rates available for various terms.
|
CD term |
Financial institution |
Annual percentage yield (APY) |
Minimum opening deposit to earn APY |
|---|---|---|---|
| 6-month | EFCU Financial | 0.85% | $100,000 |
| 1-year | EFCU Financial | 0.90% | $100,000 |
| 2-year | Latino Community Credit Union | 1.55% | $100,000 |
| 3-year | Luana Savings Bank | 1.31% | $100,000 |
| 4-year | Luana Savings Bank | 1.41% | $100,000 |
| 5-year | Latino Community Credit Union | 2.10% | $100,000 |
EFCU Financial is a credit union based in South Louisiana, though people from outside the area can join if they become a member of the EFCU Financial Foundation or Louisiana Wildlife Foundation. In addition to their regular and jumbo certificates, EFCU Financial offers a 30-month “bump-up” certificate that allows you to adjust your rate once during the term.
Veridian Credit Union has broad membership eligibility, allowing registered users of the payment platform provider Dwolla to join the credit union. In addition to their nine-month jumbo CD special, Veridian offers a regular nine-month CD special with a minimum balance of $1,000 and an APY of 0.75% — one of the best available rates for short-term CDs.
Headquartered in Northeastern Iowa, Luana Savings Bank has a small geographic footprint and specializes in agricultural lending for farmers in the area. Luana offers CDs with different interest rate tiers, and the bank is currently offering a six-month CD special with an APY of 0.75% for balances over $100,000 (and 0.65% for balances between $1,000 and $99,999).
See above for more information on EFCU Financial’s membership eligibility requirements and jumbo CDs.
Interior Federal Credit Union allows people to join by volunteering at a national park or becoming a member of the New Mexico Wildlife Foundation. If you’re looking for a jumbo CD with a term of somewhere between 12 and 24 months, Interior Federal Credit Union’s 20-month “bump-up” CD with an APY of 0.91% could be a good option.
Michigan State University Federal Credit Union serves the university community, but the credit union also extends membership to anyone who donates $10 to the Desk Drawer Fund. In addition to this 12-month jumbo CD, it also offers a wide range of terms with competitive APYs.
Latino Community Credit Union was founded in 2000 after a series of robberies in Durham, N.C., targeting Latino immigrants. Its mission is to offer financial services and education that empower communities. Today, it’s easy for anyone to join the credit union with a one-time $10 donation to the Latino Community Development Center, which offers financial education. The credit union’s jumbo CDs offer highly competitive rates across all terms.
See above for more information on Interior Federal Credit Union’s membership eligibility requirements and jumbo CDs.
See above for more information on Michigan State University Federal Credit Union’s membership eligibility requirements and jumbo CDs.
See above for more information on Luana Savings Bank and its jumbo CDs.
See above for more information on Interior Federal Credit Union’s membership eligibility requirements and jumbo CDs.
See above for more information on EFCU Financial’s membership eligibility requirements and jumbo CDs.
See above for more information on Luana Savings Bank and its jumbo CDs.
See above for more information on Interior Federal Credit Union’s membership eligibility requirements and jumbo CDs.
Genisys Credit Union is based in Michigan, and residents of the state (or anyone nationwide who makes a donation to Arthritis Foundation or the Paint Creek Center for the Arts) are eligible to become members. It offers jumbo CDs with terms ranging from six to 60 months. APYs go all the way up to 1.45% for a 5-year jumbo CD.
See above for more information on Lation Community Credit Union’s membership eligibility requirements and jumbo CDs.
See above for more information on Michigan State University Federal Credit Union’s membership eligibility requirements and jumbo CDs.
See above for more information on Luana Savings Bank and its jumbo CDs.
A jumbo certificate of deposit (CD) is essentially the same as a traditional CD but with a higher minimum deposit requirement and sometimes higher APYs. Financial institutions have different criteria for what’s considered a jumbo CD — MagnifyMoney selected CDs with a minimum of at least $50,000 for this list.
Right now, in an environment of low interest rates, many jumbo CDs are currently paying a lower APY than traditional CDs. Jumbo CDs used to be incentivized with higher interest rates, but that’s no longer the case. If you intend to store your money in a long-term savings vehicle, a CD might be right for you, but you should make sure you’re getting the best available interest rate on that deposit.
At the time of account opening, the CD accountholder makes a deposit and agrees to a predetermined maturation date and interest rate borne on the account. CDs are safe, as long as the bank or credit union is insured by the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA).
Once a CD has been opened, accountholders can’t deposit more money or withdraw their funds without incurring a penalty (in most cases, though there are some specialty CDs that offer that flexibility). The interest rate is also locked in: even if the broader rate environment changes, which affects the APY paid on other types of deposit accounts, the CD rates will stay the same throughout the term.
There are plenty of alternatives to jumbo CDs, including traditional CDs (and with traditional CDs, it’s also easier to structure a CD ladder because of their lower minimum deposit requirements, for example). The APY paid on jumbo CDs is currently not much higher than the APY paid on traditional CDs.
A savings account can be a good long-term alternative to a CD because it gives the accountholder the ability to withdraw their money penalty-free and also bears interest. Interest rates for CDs are generally higher than interest rates for savings accounts, but as of early 2022, the rates paid on deposit accounts are lower than usual across the board. Rates for deposits in savings accounts could improve, while the APY on a jumbo CD is fixed for the entire duration of the deposit.
Jumbo CDs require a substantial deposit, and those funds could be invested in other ways: the stock market may be too risky for the conservative saver, but bond investments are subject to less volatility. Real estate investments, including real estate investment trusts (REITs), are another option.
Using information from DepositAccounts, which surveys hundreds of banks and credit unions, we compiled lists of the best jumbo CDs for various term lengths. Each CD must have a minimum deposit of at least $50,000 to be considered a jumbo CD, and each CD must be offered nationally through an FDIC-insured bank or an NCUA-insured credit union. Credit unions must have broad membership eligibility rules in order to qualify.
Source: https://www.magnifymoney.com/blog/earning-interest/top-jumbo-cd-rates/
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