October 26, 2023

3 Year CD Rates

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What are the top 3-year CD rates today? See if they are worth the commitment.

Top 3-year CD Rates:

Are you okay with locking your money away for three years in exchange for a good rate? If so, a 3-year CD might just be the perfect account for you.

But, remember that it's not only about finding the highest APY. Continue on to know what other factors you should consider and whether it is actually worth it.

To get you started, check out the best 3-year CDs available today.

What is a 3-Year CD?

A 3-year or 36-month certificate of deposit (CD) is a long-term account with a fixed rate and a fixed term of three years. You're usually not supposed to withdraw the CD until it matures. Otherwise, you will be charged penalties.

Note that not all banks offer this term, but long-term CDs like this usually come with relatively high APY.

What happens if I withdraw my 3-year CD?
Withdrawing your 3-year CD before maturity often incurs early withdrawal penalty fees. These charges may cost from a few to several months of interest. Note that you usually cannot withdraw portions of your CD. You need to take out the whole amount, ultimately closing your 3-year CD.

How much interest does 3-year CDs earn?

Say you have a 3-year CD with a $5,000 deposit and a 4.5% APY. You will earn around $706 at maturity. But if you have a higher deposit and a better APY, you can earn more on your CD.

Here's a table to show you what you can earn with various APYs and deposit amounts.


To know how much you can earn on other CD terms and rates compared to 3-year CDs, use this convenient CD calculator.

CD Calculator

Is a 3-Year CD Worth It?

If you're on the hunt for a passive investment option, a 3-year CD may be something you can look into. Getting one can preserve and grow your savings for the next three years. But, you must be confident that you won't need your funds any time soon.

To maximize your 3-year CD, you can't take your money out until it matures as you may lose your earnings to early withdrawal penalties.

It all comes down to whether a 3-year CD aligns with your financial goals. For instance, it could be a smart choice if you're planning for your retirement. But, you're probably better off with a different investment if you're saving up for a quick vacation or building your emergency fund.

What CD term should I choose?
The CD term you choose will highly depend on your financial goals.

Tip: A smart goal is a measurable goal. Estimate your goal's timeline and choose a CD term based on that. CD terms range from 1 month to 10 years, so you have many options to match your goals.

Pros and Cons of a 3-year CD

If the 3-year term works for you, take some time to consider the pros and cons of a 3-year CD.


  • Usually higher rates compared to savings accounts and short-term CDs
  • Federally insured up to $250,000 by the FDIC or the NCUA
  • Fixed, competitive rate throughout CD term


  • Usually can't add or withdraw money until the CD matures
  • Early withdrawal penalties can be costly
  • Potentially miss out on better APY and investments
  • 3-year CD may not grow fast enough to keep up with inflation

Are 3-year CDs safe?
Yes, 3-year CDs are a safe and stable passive investment option. Not only are your interest earnings guaranteed, most CDs are also federally insured up to $250,000 which means the FDIC or NCUA will cover your deposits in case your bank or credit union fails.

Choosing the Best 3-year CD

It's best to cover all your bases for a 3-year-long investment. Here are the major points to consider when shopping for 3-year CDs.

  1. APY
    Look for the highest APY available on a 3-year CD as much as possible. It's best to check online banks and credit unions as they usually offer high rates on their CDs.

  2. Minimum Deposit Requirement
    A 3-year CD may or may not have a minimum deposit requirement but the typical range is from $500 to over $1000. Make sure to check the deposit requirement if you have a budget to follow.

    If the amount isn't an issue, check out 3-year jumbo CDs—these often give better rates than standard CDs due to their higher minimum deposit.

  3. Early Withdrawal Penalties
    You must try your best to keep your money in the 3-year CD until it matures for maximum earnings. Thus, it would be best to look for one with minimal penalties in case of emergencies. You can also check out no-penalty CDs to avoid them entirely.

  4. Other Features
    Some 3-year CDs have special features that may benefit you. For example, a "bump-up" increases your rate during the term and an "add-on" lets you deposit more into your CD. These can be rare but are great to have depending on the situation.

When is the best time to get a 3-year CD?
The best time to get a 3-year CD is usually when interest rates are at their highest, just before when interest rates are expected to decrease. Typically, you can watch the Fed Funds rate trend to time your CD investment. This can help you lock in good rates before they go down.

What is the most important factor you consider when choosing a 3-Year CD?

Alternatives to 3-Year CD

If you're still on the fence about 3-year CDs, here are some alternatives that you can check out.

Better liquidity with High-Yield Savings Account
If tying up your money worries you, high-yield savings accounts may give you the flexibility you need. Luckily, many online high-yield savings accounts out there offer competitive rates.

Compare Savings Account Offers

Secure returns with Treasury Securities
Treasury bills, notes, and bonds can have competitive, fixed rates for a 3-year period too. These government-backed securities are usually safe and stable, even when interest rates are constantly changing.

Higher yields with Corporate Bonds
Corporate bonds typically pay higher interest than government bonds, but there may be a bit more risk involved. Be sure to research the company and check its credit ratings before investing in its bonds.

Higher returns with Blue Chip Stocks
Blue chip stocks belong to well-established companies with a history of strong growth and attractive dividends. While there's more risk involved in the stock market, withdrawing your investments is a bit easier (with some fees).

Other CD Terms
If a 3-year CD doesn't suit your plans, there are other terms available, ranging from 1 month up to 10 years. Some may even offer better rates and perks than a standard 3-year CD. So, do research to find one that fits your situation best.

Consider Odd-Term CDs
Sometimes banks and credit unions offer promotional CDs with "odd" terms. These are CDs with non-standard terms like 13-months, 11-months, 5-months, etc. They also usually have very competitive rates.

Compare Odd-Term CD Rates:

3-year CD FAQs

How do I use a 3-year CD in a CD Ladder?
If you're building a CD ladder, the 3-year CD should be one of the long-term CDs in your ladder. CD laddering is a strategy where you break up your money into multiple CDs.

The idea is to have CDs mature in intervals. This way, you get the flexibility to use or reinvest your money whenever it becomes available.

To visualize how much you can earn with a 3-year CD ladder, here's a CD ladder calculator you can use.

How do I open a 3-year CD?
3-year CDs are offered by some banks and credit unions. You can visit their website or go to the nearest branch to open a 3-year CD account. Make sure to check and see if the 3-year term is available.

Prepare your personal information and any IDs beforehand. Once your account is open, fund it through the designated channels.

Will 3-year CD rates go up?
Typically, 3-year CD rates will go up if the Fed Funds rate recently increased. There is no guarantee that CD rates will go up or down, but following the movement of the Fed Funds rate is a good way to estimate it.

Bottom Line

Ultimately, whether a 3-year CD is worth the commitment or not depends on your financial plans. A lot could happen in between so making sure you have a specific and measurable goal is best when getting any long-term investment.

Take some time to think and do your research before you get a 3-year CD.

Write to Rue Atanacio at feedback@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.

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