1-Year CD Rates from Online Banks 2024

No, it's not Carnival, but Banco do Brasil Americas has broken out savings and CD rates that are amongst the best in the country for balances of $100,000 or over. If you don't want to deposit that much in the bank, their rates for balances between $10,000 and $99,999 aren't bad either. The chart below shows their rate offerings:

• Compare to the best savings account rates.
• Compare to the best CD rates

Banco do Brasil has six locations in southeastern Florida.

The bank is financially sound with a Texas ratio well below the national average (a low Texas ratio is good).

For those that live in southeastern Florida, these rates are worth checking out.

If you don't live in this bank's deposit area, find the top rates in your location.

TD Ameritrade is contacting all of their clients today to try and syndicate a 5 year CD paying 2.40%. This CD is covered under FDIC insurance rules to the $250,000 limit and because it is issued by Amex Centurion Bank, it is covered under a different FDIC certificate than savings accounts you may have at American Express Bank FSB. It also may offer a yield slightly higher than the best 5-year rates otherwise available. Nevertheless, these types of brokered issues should be avoided.

Longer-term CDs, such as a 5-year CD, can be attractive, even in a low rate environment, but only when they offer a reasonable termination clause. As this article explains, a 5-year CD with a 6 month early termination fee can effectively represent a way to get a decent one-year yield with an option to continue to hold the CD if interest rates do not rise in the outer years.

Brokered CDs, like this Amex issue through TD Ameritrade, do not offer this option. If interest rates rise, you are either stuck earning a below market interest rate or forced to sell the CD at a loss through TD Ameritrade.

Longer-term interest rates may rise dramatically at some point over the next 5 years. In fact, a dramatic spike may occur in the next year when the Federal Reserve begins to raise interest rates later this year. Even if you commit to trying to get out of this issue at the earliest signs of a interest rate move, you are going to take a huge loss selling through TD Ameritrade into an illiquid market (in fact, you would take a huge loss were you to try to sell this issue the day after purchasing it since the market is entirely illiquid). In an online 5-year CD with a 6 month early termination penalty - such as those offered by Synchrony Bank and Barclays Bank - you always have the option of holding the CD for 6 months and using the six months' interest to cover the penalty.

It should also be noted that most online brokers waive the early termination penalty upon the death of the holder, allowing the heirs / beneficiaries or executor to redeem the CD at par value. TD Ameritrade usually also forces brokered CDs to be sold into the market at a loss upon death, although with this offering they claim to offer a survivor’s option (when I called TD Ameritrade about this issue, their fixed income department was unable to fully explain or document the details of this option).

Compare the best 5 year CD rates.

In the comments section for Home Savings (the official name of the bank is The Home Savings and Loan Association of Youngstown, Ohio), some visitors questioned whether the 3.00% APY 12-month CD listed on BestCashCow was valid. It seems almost too good to be true. We checked it out and the rate is valid. This is easily the best 12-month CD rate available in the country. For comparison, the best 1 year online CD rate is 1.23% APY and the average rate for this term is 0.35% APY.

The CD can only be opened at select branches including Chardon, Aurora, Salem, and Streetsboro. The rate is only good with new money deposited into the bank.

Home Savings branches are located in Northeast Ohio. The bank was established in 1889 and has assets of $1.8 billion. Home Savings is an FDIC insured institution.

If you live anywhere near a Home Savings branch then it makes sense to give them a call or pay them a visit and see if they offer the special rate.

Don't live near a Home Savings bank? BestCashCow lists plenty of above-average online and local rates you are eligible to open.

• View the best CD rates.