Contributor, Benzinga
September 7, 2022
BZ

Quick Look at the Best Jumbo CD Rates

Best 3-Month Jumbo CD: NexBank
Best 6-Month Jumbo CD: Interior Federal Credit Union
Best 1-Year Jumbo: Credit One Bank
Best 2-Year Jumbo: Rising Bank
Best 3-Year Jumbo: Latino Community Credit Union

If you’re looking for a simple and safe investment, jumbo certificates of deposit (CDs) should be on your list of financial products to explore. Here’s how they work: You agree to deposit a certain amount of money with a bank or credit union, and they agree to pay you a certain interest rate for the entire term. Once that term is up, you can pull out the money, or you can choose to invest it again in another jumbo CD.

Different banks and credit unions offer various jumbo CD rates, but they’re not always better than standard CDs. That’s why it’s important to thoroughly investigate these products before you sign an agreement to deposit your money.

If you’re looking for the best CD rates, you’ve come to the right place. Benzinga analyzed jumbo CD rates from a variety of banks and credit unions to give you a head start on your research.

Best 3-Month Jumbo CD: NexBank

  • securely through NexBank's website
    securely through NexBank's website
    Best For:
    Jumbo CDs
    Rating:

NexBank offers an array of online products in addition to jumbo CDs. You can also open a standard CD for as little as $10,000 or a high-yield money market account for the same amount. Because all transactions are conducted online, the streamlined service will save you time and the hassle of having to drive to a brick-and-mortar office.

Best 6-Month Jumbo CD: Interior Federal Credit Union

Aside from offering many options in terms of length for CDs, the Interior Federal Credit Union provides many ways to fund a CD. You can open a traditional CD or a jumbo CD, and each of those can be funded with an individual retirement account (IRA) retirement account, an education savings account or a health savings account.

Best 1-Year Jumbo CD: Credit One Bank

  • securely through Credit One Bank's website
    securely through Credit One Bank's website
    Best For:
    Multiple Banking Options
    Rating:

Credit One Bank offers some unique perks for jumbo CDs that other banks and credit unions don’t. For instance, if you renew your CD, you will automatically receive a 0.05% rate increase. Also, if the bank’s APY goes up within 10 working days after you open your CD, it will increase your rate to match it. Combine these perks with the above-average rate for its one-year jumbo CD and this is a bank you should definitely look at.

Best 2-Year Jumbo CD: Rising Bank

  • securely through Rising Bank's website
    securely through Rising Bank's website
    Best For:
    Standard CDs
    Rating:

While Rising Bank offers generous interest rates for its two-year jumbo CD, it is the only jumbo product that it offers. You can, however, purchase standard CDs for one-, two-, three-, 15-month, 18-month and 36-month terms.

Best 3-Year Jumbo CD: Latino Community Credit Union

Latino Community Credit Union not only offers great rates on its jumbo CDs but is also known for giving back to the community. Additionally, you can open a savings account, checking account, money market account, IRA and a standard CD with the credit union.

Features to Look for in Jumbo CDs

When looking for a jumbo CD, here are a few features you should look for.

1. Rates

The No. 1 feature you should look for in a jumbo CD is the rate the bank or credit union offers. Remember, jumbo CDs don’t always offer the highest rates. Sometimes you can get a better rate by depositing your money in a standard CD for longer periods.

2. Insurance

Check to make certain that the bank is insured by the Federal Deposit Insurance Corporation (FDIC) and that the credit union is insured by the National Credit Union Administration (NCUA). Your money will be insured for up to $250,000 per bank.

3. Minimum deposits

Most banks and credit unions require a deposit of $100,000 for a jumbo CD, but you may be able to find one that offers less. If you do, be sure to compare the rates, and make sure your money is insured.

4. Ease of transactions

Some banks and credit unions make it easy for you to open a jumbo CD while it is more difficult with others. If convenience is key to you, look for one that allows you to open an account online and pull from a variety of accounts to fund your jumbo CD.

How to get a Jumbo CD

Opening a jumbo is a great goal, and you may have to take some steps to achieve it. Reach your goal faster with these tips:

1. Open the right accounts

Some issuers of jumbo CDs require you to have a second account with them. For instance, they may require that you have a savings account with their institution. If this is the case for the jumbo CD you’ve decided on, be sure to set up the required accounts before attempting to deposit into your jumbo CD.

2. Do your research

You have specific things you must take into consideration when deciding which jumbo CD you will invest in. For instance, you can invest short term, or you can leave your money on deposit for a longer period of time. Your interest rate will depend on how long you leave your money in. Do your research to determine which terms better suit your needs.

3. Start small

If you don’t have the funds to open a jumbo CD, you can start smaller and work your way up. For instance, most banks or credit unions offer standard CDs along with jumbo CDs. And you can deposit as little as $500 to open a standard CD.

4. Speak to your bank

If you’re confused about what is the right jumbo CD for you, talk to your bank or credit union. They will go over their rates and help you decide which jumbo CD will yield the best results for your money.

How You Can Improve Your Finances

1.  Save your money

When looking to improve your finances, your No. 1 goal should be to save as much money as you can. Doing so will allow you to make investments that will earn you more money. For instance, if you want to invest in a jumbo CD, most banks will require that you deposit $100,000 to open one.

2. Understand your debt-to-income ratio

Banks look at your debt-to-income ratio when deciding whether or not to grant you a loan, but this is a metric that you should look at yourself when trying to improve your finances because it gives you a realistic picture of your financial health.

To get yours, divide your total monthly bills into your gross monthly income. Your debt-to-income ratio should not be higher than 50% and ideally much lower than that.

3. Invest what you can

Today’s interest rates for savings accounts aren’t much (although you can find some good online savings accounts that pay higher interest rates), and that’s why you should look to other investments to help grow your money and improve your finances, even if you start with micro-investing. For instance, if you start big, some top jumbo CDs pay over 1% in interest rates, which is much more than you will earn holding all of your money in a savings account.

4. Start a budget

It’s not possible to improve your finances if you don’t keep track of how you’re spending your money. Start by setting up a budget and then sticking to it. Once you get a handle on your incoming and outgoing money, you can begin to learn some investing basics to use as your money grows.  

Frequently Asked Questions 

Q

Are jumbo CDs worth it?

A

CDs can be a great, safe investment, and while you will commonly find that jumbo CDs offer a higher interest rate, that’s not always the case. Be sure to do your research and look at both regular CDs and jumbo CDs to find the best option for you.

Q

Are jumbo CDs negotiable?

A

Jumbo CDs are not typically negotiable. Banks and credit unions set their CD rates based on numerous metrics, and those rates remain fixed. That said, if you plan to deposit a larger-than-normal amount of money, it won’t hurt to speak to your banker about an interest rate increase.

Q

Should you keep more than $250,000 in a bank?

A

Although you can open a jumbo CD for more than $250,000, the FDIC bank or NCUA institution will only insure your deposit up to $250,000 per bank. If you plan to deposit more than that, think about opening more than one jumbo CD in multiple banks. This is the best way to ensure that your money is safe.

Q

Who has the highest-paying CD rate right now?

A

CD rates vary depending on how much money you deposit and how long you plan to keep the money on deposit. To determine the highest-paying CD right now, check the list Benzinga offered above against your requirements and choose the one that offers the best rate for those terms.