Four Year Certificates of Deposit (CD) are not as popular as the three and five year terms which means the rates often aren’t as competitive. The best four year cd rates are often only marginally above the 3 year rates. Nevertheless, for those who want to lock in a rate for a longer period of time, 4 year cds are worth a look. Four Year CDs rates from online banks are often higher than the national average.
July 25, 2017
4 Year CD National Average: 1.02% ?
|EverBank / TIAA DIrect||2.15%||2.12x||$1,500||
|Northern Bank Direct||2.15%||2.12x||$10,000||Reviews|
|Barclays Bank Delaware||2.05%||2.02x||$0||
|M.Y. SAFRA BANK, FSB||2.05%||2.02x||$5,000||Reviews|
NAVY FEDERAL CREDIT UNION
|Goldman Sachs Bank||1.80%||1.77x||$500||
|Capital One 360||1.80%||1.77x||$1,000||
|Salem Five Direct||1.75%||1.72x||$10,000||Reviews|
|CNB Bank Direct||1.51%||1.49x||$1,000||Reviews|
|American Express Bank, FSB||1.45%||1.43x||$0||
|Bank of Internet||1.40%||1.38x||$1,000||
|New Dominion Direct||1.30%||1.28x||$1,000||Reviews|
|USAA Federal Savings Bank||1.00%||0.99x||$175,000||Reviews|
Four year CDs are a longer-term CD and offer a fixed rate for 4 years in return for a commitment to keep the money in the bank for this period of time. While savers can withdraw the money (termed "breaking the CD") high penalties make this undesirable. Generally, an individual should not invest in a four year CD unless they are comfortable parting with the money for this period of time.
Four year CDs from FDIC insured banks are insured up to FDIC limits (generally $250,000 per account holder per bank). If your deposit is over the FDIC limit then you may not receive the uninsured money in case of a bank failure. For this who remain within FDIC limits, the principal threat is inflation. The value of longer-term CDs are especially prone to be eaten away by inflation, especially if the CD is opened in a rising rate environment.
Four year CDs currently pay between .40-.60 percentage points more in interest than a one year CD. In general, CDs of this duration are best opened as part of a laddered CD portfolio or if the depositor thinks that rates will either stagnate or drop over the next couple of years. To get a sense of rate trends, please visit our BestCashCow rate analysis page.
All banks listed on BestCashCow are FDIC insured; BestCashCow.com strongly recommends that you stay within FDIC insurance limits and that if you are unsure of how the limits affect you, please visit the FDIC website.
To understand all of the income generating options available to a saver, please view the Income Generating Investments Comparison Chart.
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