Looking to score a solid return with limited risk? Check out certificates of deposit (CDs). CDs are deposit accounts requiring you to commit your funds for a pre-defined term in exchange for a fixed interest rate.
To determine the most lucrative CDs, we joined forces with Curinos, tapping into a wealth of information including 20,000 data points from banks and financial institutions across Rhode Island. Our meticulously chosen CDs feature the highest annual percentage yields (APYs) available in the state.
Additionally, you can rest easy knowing that our recommended CDs are covered by FDIC or NCUA insurance, safeguarding your investment for up to $250,000. Your money stays protected while you enjoy the benefits of a risk-free investment.
Best CD rates in Rhode Island overall
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Of course, you’re not limited to options in the state where you live. We've also gathered data from banks across the country to narrow down banks and credit unions offering the best CDs nationwide. These carefully chosen CDs offer competitive interest rates and low opening deposit requirements, no matter where you live.
Best CD rates in Rhode Island by term
By analyzing data sourced from Curinos, we’ve pinpointed the best 6-month, 1-year, and 5-year CDs available in Rhode Island.
To be eligible for these rates, please refer to the criteria outlined in the notes field in the tables below. Some fields may be blank, so for the most accurate details, reach out to the respective institution directly.
Best 6-month CD rates in Rhode Island
Earn a stellar APY without locking up your funds for a long time with a 6-month CD. Note that you’ll typically be rewarded with a higher APY when you tie up your money for longer.
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Best 1-year CD rates in Rhode Island
If you're not prepared for a multi-year commitment but have an investment timeline that’s longer than six months, a 1-year CD could be the perfect in-between option. Additionally, some CDs have low minimum opening deposit requirements, allowing you to take advantage of them regardless of how much you have to save.
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Best 5-year CD rates in Rhode Island
If you’re saving up for a financial goal years down the line, consider a 5-year CD. While it’s more of a commitment, 5-year CDs generally provide higher rates than shorter-term options.
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What is a certificate of deposit?
When you choose a CD, you commit your funds for a set period and receive a fixed interest rate. This deposit account is risk-free if your bank or credit union is FDIC or NCUA-insured.
However, if you need access to your funds before the CD matures, be prepared to pay an early withdrawal penalty. Typically, this penalty equals a few months' worth of interest.
What does APY mean on a CD?
APY, or annual percentage yield, represents the interest earned over the course of a year. For instance, if you stashed $10,000 in a 1-year CD offering a 5% APY would yield $500 at the end of the year.
What are the most common types of CDs?
Several types of CDs are common like traditional, brokered, and no-penalty CDs.
- Brokered CDs. Financial institutions sell these CDs to brokerages. Brokerages then sell them to customers with more attractive APYs than traditional CDs.
- No-Penalty CDs. With these CDs, you can access your funds without facing early withdrawal fees. However, these CDs typically offer lower interest rates.
- Traditional CDs. Banks and credit unions offer these deposit accounts, providing customers with fixed interest rates when they tie up their funds for a fixed period.
How to choose the best CD in Rhode Island
There are over 15 FDIC-regulated banks in Rhode Island and 10 NCUA-regulated credit unions. Here’s how to choose the right one for your needs:
- Term length. The term length of your CD indicates the time it takes to mature. CD terms be as brief as one week to as long as 10 years. Select a term length that suits your requirements and financial goals.
- APY. The APY tells you how much money you’ll earn in a year, so a higher APY means you’ll earn more.
- Minimum deposit. Many banks and credit unions require that you invest a minimum amount of money to open a CD and don’t allow additional contributions. The minimum opening deposit can range from a few dollars to thousands. Make sure you’re able to meet the minimum opening deposit requirement.
- Penalties: Many CDs impose penalties for early withdrawals. These penalties are typically worth a few months of interest and may eat away at your principal. While unforeseen early withdrawals are unavoidable, it's essential to be aware of these penalties if you need to access your funds prematurely.
- Deposit insurance: With FDIC and NCUA insurance, depositers receive insurance coverage if their bank or credit union fails—up to $250,000 per depositor or share owner. You’ll want to ensure your money is protected if there’s a bank failure.
