Best jumbo CD rates July 2024
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BLUEPRINT
Updated 5:17 a.m. UTC July 1, 2024
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My eBanc Jumbo Online Time Deposit offers the best jumbo certificates of deposit (CDs) in 2024, according to our extensive analysis, thanks to its high yields, affordable minimum deposit requirement and low fees.
All annual percentage yields (APYs) and account details are accurate as of June 27, 2024.
Best jumbo CD rates
- My eBanc Jumbo Online Time Deposit.
- State Bank of Texas Jumbo certificates of deposit.
- Apple Federal Credit Union jumbo certificates.
- State Department Federal Credit Union jumbo certificates.
- Michigan State University Federal Credit Union jumbo certificates.
Why trust our banking experts
Our team of experts evaluates hundreds of banking products and analyzes thousands of data points to help you find the best product for your situation. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.
- 140 CDs from 84+ financial institutions reviewed.
- 4 levels of fact checking.
- 50+ data points analyzed.
Best jumbo CD rates July 2024
Compare the best jumbo CD rates
| INSTITUTION | STAR RATING | APY | MIN. DEPOSIT |
|---|---|---|---|
My eBanc
| 5 | 3.98% to 5.51%
| $50,000
|
State Bank of Texas
| 4.86 | 5.40%
| $50,000
|
Apple Federal Credit Union
| 4.61 | 3.85% to 4.75%
| $50,000
|
State Department Federal Credit Union
| 4.66 | 4.37% to 5.20%
| $100,000
|
Michigan State University Federal Credit Union
| 4.6 | 3.50% to 4.50%
| $100,000
|
Methodology
We did a bunch of calculations to determine the best jumbo CD. Here’s the factors we considered and how we weighed them.
60%: APY. Whatever term you choose, the point of putting a lot of cash into a CD is to have it earn money safely. We weighed CD yields as the most important factor in our considerations.
20%: Customer service and digital experience. When you deposit a large amount of money with an organization, being able to trust that you’ll be treated well by the people and the technology is important.
10%: Availability. If you live on the west coast, it won’t help you to know that a bank that only serves Floridians currently has one of the highest yields. We rewarded institutions that served the whole country.
5%: Compound interest schedule. The more often a CD compounds, the more you’ll earn. We favored CDs with a daily compounding interest rate.
5%: Available terms. Depositors have different goals and life plans. Financial institutions that had different jumbo CD terms for you to choose from earned a higher score.
Why some banks weren’t chosen
Not all banks made our list. In fact, you’ll notice that some of the largest financial institutions in the nation didn’t.
The most well-known names in banking tend to offer low deposit yields because they don’t have the need to be competitive and attract customers; they already have plenty of deposits and customers.
Smaller banks and credit unions tend to offer great interest rates to make a splash and gain depositors.
What is a Jumbo CD
Just as jumbo shrimp are really big shrimp, a jumbo CD is just as a traditional CD that requires a higher minimum deposit.
You’re also entitled to the same Federal Deposit Insurance Corporation (FDIC) insurance, though you may push up against the $250,000 limit per depositor, per institution, per ownership type.
However, just because it’s named jumbo doesn’t mean you’ll reap higher yields. In fact, many of our best CDs give you a better rate and require substantially smaller opening deposits.
Jumbo CDs vs. traditional CDs
The primary difference between traditional CDs and jumbo CDs is the sizable minimum deposit requirement for a jumbo CD, which usually lands at about $100,000.
This size difference matters; depending on the bank, you may be able to earn a higher yield with a jumbo CD compared to a traditional one.
Jumbo or not, however, CDs are considered one of the safest ways to earn interest.
“A primary reason to put money into a CD is to avoid the market deviations in the stock and bond markets,” said Tim Mazanec, a wealth management advisor at The Harvest Group, in Cambridge, Mass.
With deposit insurance up to $250,000 from the FDIC or the NCUA (National Credit Union Administration), your CD principal isn’t at risk from market forces. (Unless you go super jumbo.) Just be careful that the total amount of deposits you make at one insured financial institution doesn’t exceed that limit.
Consider spreading out your jumbo CDs across a few different banks so all of your deposits are covered.
Finding the best jumbo CD rates
In general, CD rates are currently at their highest levels since the Great Recession of 2008. With the Federal Reserve continuing to raise interest rates to stem high inflation, those jumbo CD rates levels should be around for a while; but, certainly not forever.
Learn more: our CD rate forecast.
“Investors should keep in mind, however, that if a recession in the U.S. were to materialize, then historically the [Federal Reserve] reacts by easing monetary policy, which may result in lower CD rates in the future,” Mazanec said.
That’s why locking in a long-term CD makes sense, even if you can get higher yields from shorter fare.
Pros and cons of jumbo CDs
Pros
- Higher rates. You may be able to earn higher interest rates with jumbo CDs compared to other deposit vehicles, including savings accounts and traditional CDs.
- Low risk. As long as you don’t exceed the limit of $250,000 per depositor, per institution, per ownership type, your entire deposit is insured.
- Term options. Like traditional CDs, jumbo CDs are available in a wide range of terms.
- Guaranteed yield. A CD locks in the APY; you won’t be wondering how much you’ve earned or worrying about rate fluctuations during the CD’s term.
Cons
- High minimum deposit requirement. Most Americans may find themselves barred from jumbo CD deals due to minimum deposits of around $100,000.
- Early withdrawal penalties. If you need cash for an emergency before the term expires, you’ll likely face early withdrawal fees. High-yield savings accounts are more liquid.
- Potentially lower returns than other investment options. While low risk, CD yields fall short of the average stock market return rate and some don’t earn enough to keep up with inflation.
Tips on getting the best jumbo CD deal
Examine your financial needs first
If you’re looking for an extremely safe way to earn interest and don’t mind locking away the cash for the whole term, a jumbo CD can be the right choice. “Our clients should really shop for what best suits their needs,” said Arijit Roy, head of consumer segment and product at U.S. Bank.
Determine what timeline suits your financial plans. Be sure that you can commit the whole fund for the entire term. If you’re waffling and can’t decide on a CD maturity date, it can be smart to either simply go with the shorter term or, if you have enough funds, to deposit half in a short-term one and half in a long-term one.
Research
Understand what purpose your CD savings will serve in your large financial picture. Is this cash that you need now, or years in the future? Understand that you may be sacrificing higher returns from the stock market in order to get rate certainty.
You should also research the best rates available, as well as look for CDs with few fees. The latter will undercut the former.
Understand the terms
Take any marketing talk with a grain of salt however. Be aware of early withdrawal penalties and their impact on returns.
“CDs give you a reasonable return because they lock-up your capital and withdrawing early can cause penalties that can significantly impact your returns,” said Jack Prenter, chief executive officer at Dollar Wise, a personal financial advisory platform based in Ontario, Canada.
Consider CD laddering
CD laddering is a deposit strategy in which you have multiple CDs with staggered maturity dates.
“Laddering will balance the benefits of higher interest rates on longer-term CDs with the liquidity and flexibility of shorter-term CDs,” Prenter said.
Frequently asked questions (FAQs)
Like traditional CDs, jumbo CDs are considered low risk investments given that you can have deposit insurance up to $250,000 per institution, per ownership type. If your total deposits at one bank or credit union exceed that limit, consider opening an account at another institution to limit your risk.
Many jumbo CDs do not have a maximum deposit limit. Some that do have a deposit cap set it at $250,000 to $1 million.
Jumbo CDs terms typically range from three months to five years, although some can be as short as a few days or as long as 10 ten years, especially if you’re looking at brokered CDs.
The same forces that guide the path of traditional CD rates also influence jumbo CD yields. Therefore, the future rates of jumbo CDs depend largely on inflation, how the Fed reacts and how well the economy performs in the near future.
If inflation continues to moderate, though, it is unlikely the Fed will hike rates and therefore CD rates, in general, should stay around current levels. Of course, individual banks may increase rates in order to attract customer business.
In theory, you can discuss higher yields with your particular bank, especially if you have a longstanding relationship and, well, a good chunk of change to play with. However, you’re unlikely to garner a rate substantially higher than the one that is widely offered.
Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.
Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.
