The best jumbo CD rates of January 2021

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The best jumbo CD rates of January 2021

BankAPYMin. depositNext steps
Navy Federal Credit Union
0.45% to 1.20% APY$100,000Learn more
Rewards Checking
0.35% to 0.80% APY$100,000Learn more
CIT Bank
0.40% to 0.50% APY$100,000Learn more
0.05% to 0.47% APY$95,000Learn more

If you want to grow your money but keep it safe from the turbulence of the stock market, a certificate of deposit (CD) may be a good option.

"A jumbo CD is a CD with a high minimum deposit — usually around $100,000 — that pays a higher interest rate than a regular CD. You may consider a jumbo CD if you have around $100,000 and want to earn a guaranteed rate of return. Jumbo CDs often pay higher rates than regular CDs.

Jumbo CDs aren't super common, and ones that pay high interest rates are even less common. Keep reading to learn more about the institutions paying the best rates.

Learn more about the best jumbo CDs

Navy Federal Credit Union Standard Certificate

Navy Federal Credit Union Navy Federal Credit Union Standard CertificateConsumers Credit Union Consumers Credit Union Jumbo Certificate AccountCIT Bank CIT Bank Jumbo Certificate of DepositUSAA Bank USAA Jumbo Certificate of DepositAmerican Express American Express® High Yield Savings AccountChase Chase Savings℠CIT CIT Bank Savings Builder High Yield Savings AccountHSBC HSBC Premier Checking Account ($600)

If you don't need immediate access to your savings, a CD can guarantee a return on your money since you lock in a fixed annual percentage yield (APY) for the term of the CD. During that period, you typically won't be able to add additional money or access your original balance without paying a penalty.

You will, however, earn interest on the amount and have the option to collect those payments monthly or reinvest them into your CD. Most banks offer varying rates for different terms and deposit amounts — typically, the longer the term, the higher the rate.

At the CD's maturity date, you'll typically have a 10 to 14-day grace period in which you can withdraw your money and close the account or renew the term.

What is a jumbo CD?

A jumbo CD is a certificate of deposit that requires a high minimum deposit — usually around $100,000. As a reward for placing this large deposit, you'll earn a higher interest rate than you would on a regular CD.

What's the difference between a jumbo CD and regular CD?

The main distinctions are that a jumbo CD requires a higher deposit, and it usually pays a higher rate. Some banks also offer different term lengths for its jumbo and regular CDs. For example, CIT Bank's shortest term for a jumbo CD is 2 years, but you can get a CIT regular CD with a term as short as 6 months.

What are the pros of a jumbo CD?

Higher interest rates. In many cases, banks pay higher interest rates on jumbo CDs than on regular CDs.

Guaranteed rate of return. You're putting a lot of money into a jumbo CD. If you were to put that money into a riskier investment, such as the stock market, you wouldn't know how much you'd end up with in a few months or years. With a jumbo CD, you know exactly how much you'll earn.

What are the cons of a jumbo CD?

Higher minimum deposits. Regular CDs typically require a few hundred or a few thousand dollars, but you'll need around $100,000 to open a jumbo CD.

The rate isn't always better. Banks usually pay higher rates on jumbo CDs — but not always. Also, you could find a different bank that pays better rates on regular CDs than a certain bank pays on jumbo CDs.

Inflation. Depending on how long you store money in a CD and how high the rate is, the interest rate might not keep up with inflation. 

Consider investing instead. Everyone's financial situation is different. Playing it safe by putting $100,000 in a CD could be the right move for you. But if you put money in riskier investments, you might earn more in the long run.

Is a jumbo CD a good investment?

CDs aren't generally considered investments the same way something like an index fund, which puts your money into the stock market, is. Instead, a CD is typically viewed as a type of savings account, and your potential for losses and gains — your risk — is much more limited. Because the stock market is risky, experts generally don't advise investing money you'll need in the next five years. In the case of a stock market drop, you wouldn't have time to make up your losses.

If you need to access your money in three years and want a guaranteed rate of return, a 3-year jumbo CD is a better choice than a different type of investment account. 

If you're comfortable parting with your money for longer and want to take more risk with your money, then you may want to invest in the stock market. One way to do this is through tax-advantaged retirement accounts, like a 401(k) or IRA, which grows your money over decades. Another is through brokerage accounts, which are useful tools to build long-term wealth, but can't guarantee a given return like a CD can.

There is such a thing as an IRA CD, which is sort of a combo savings/investment account. It's a safe investment tool that may be a worthwhile option for people who are close to retirement age.

This post was reviewed and updated on December 29, 2020.

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