A certificate of deposit (CD) is an excellent investment option for individuals who want a safe and reliable way to grow their money. The beauty of CDs is that they offer fixed interest rates, which means that you can predict the amount of money you will earn over the life of the CD. Moreover, jumbo CDs are a great way to earn a higher interest rate if you have more money to invest. This guide will cover the best CD ladder strategy, the best jumbo CD rates, and everything you need to know about jumbo CDs.
What Is A Jumbo CD Rate?
A Jumbo CD rate is a certificate of deposit with a higher minimum balance requirement than a regular CD rate. The minimum balance for a Jumbo CD can be as high as $100,000, and the interest rates are usually higher than those of regular CDs. Jumbo CDs are available from banks and credit unions and typically have terms of six months to five years. Because the minimum balance requirement is so high, Jumbo CDs are best suited for investors with a large amount of money to invest. However, they can also be a good option for investors looking for a safe investment with a higher return.
Earn The Highest Interest Rates On Savings Today
Fixed annuities are almost identical to Certificates of Deposit (CDs) accounts and provide higher interest rates and penalty-free withdrawals for income.
| Term | Insurance Company | APY |
|---|---|---|
| N/A | Money Market Account – Optimum Bank | 5.26% |
| N/A | Money Market Account – FVC Bank | 5.26% |
| N/A | Savings Account – CloudBank 24/7 | 5.26% |
| 12 Months | Bread Savings CD | 5.50% |
| 48 Months | Clear Spring Fixed Annuity | 5.15% |
| 5 Years | Athene Fixed Annuity | 5.30% |
| 10 Years | Equitrust Fixed Annuity | 6.00% |
Disclaimer: This is a review. The Annuity Expert is not associated with a bank or credit union. However, fixed annuities are sold at most financial institutions. We aim to help you find the highest interest rates for your retirement savings. We may receive a small referral fee if you purchase something using a link in this guide.
Today’s Best Jumbo CD Rates
Jumbo CDs typically require a minimum investment of $100,000. However, the high minimum deposit requirement allows for higher interest rates. Here are some of the best jumbo CD rates available:
This table includes terms ranging from 3-months to 5-year jumbo CD rates.
Best CD Ladder Strategy:
A CD ladder investment strategy involves splitting your money into several CDs with different maturity dates. The purpose of a CD ladder is to provide a regular stream of income while still taking advantage of higher interest rates. Here are some of the best CD ladder strategies that you can follow:
- Start with a 1-year CD: This allows you to earn a decent interest while maintaining flexibility if you need to withdraw your money.
- Move to a 2-year CD: After your 1-year CD matures, move your money to a 2-year CD. This will provide you with a higher interest rate and still keep some flexibility.
- 5-year CD: After your 2-year CD matures, move your money to a 5-year CD. This will provide you with the highest interest rate available and still keep some flexibility.
What Are Jumbo CDs Paying?
Jumbo CDs pay higher interest rates than regular CDs due to the more considerable deposit required. Currently, jumbo CDs pay an average interest rate of 4.10% for a 1-year term, 4.50% for a 2-year term, and 4.25% for a 5-year term.
Which rates are better to buy?
The answer to this question depends on your investment goals and financial situation. If you are looking for a short-term investment with relatively quick access to your funds, then the 12-month jumbo CD rates may be the best option. However, keep in mind that shorter-term CDs typically have lower interest rates.
On the other hand, if you are willing to invest your money for a more extended period and want to earn a higher interest rate, then the 3-year and 5-year jumbo CD rates may be a better choice. Although you will have limited access to your funds during the term of the CD, you will earn a higher interest rate than with a shorter-term CD.
The 2-year jumbo CD rates balance earning a higher interest rate and maintaining some flexibility with your funds. However, the interest rates may not be as high as with a 3-year or 5-year CD.
Next Steps
Investing in a jumbo CD can be a great way to earn a higher interest rate on your savings. By following a CD ladder strategy or simply investing in the highest jumbo CD rates available, you can ensure your money works for you. Remember to research, compare rates, and choose a reputable bank or credit union to ensure your investment is safe and secure.
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