The 12-month CD is the most commonly searched and opened CD term for a good reason: it’s long enough to lock in a meaningfully higher rate than a savings account, but short enough that you’re not committing your money for years. As of July 2026, the national average rate on a 1-year CD sits at roughly 2%, while the top nationally available rates are more than double that — over 4% APY at several online banks.
This guide ranks the best 12-month CD rates of 2026, with a focus specifically on this term length, including which banks offer the most forgiving early withdrawal penalties if your plans change.
Quick Answer: Best 12-Month CD Rates of 2026
| Bank | Best For | Approx. APY* | Minimum Deposit | Early Withdrawal Penalty |
|---|---|---|---|---|
| CIBC Bank USA | Best Overall Rate + Lenient Penalty | ~4.21% | $1,000 | 30 days’ simple interest |
| Popular Direct | Highest Widely Available Rate | ~4.17% | $10,000 | 90 days’ interest |
| Marcus by Goldman Sachs | Best From a Big-Name Bank | ~4.20% | $500 | 90 days’ interest |
| Capital One | Best With No Minimum Deposit | ~4.00% | $0 | 90 days’ interest |
| Bask Bank | Best Balance of Rate and Access | ~4.10% | $1,000 | 90 days’ interest |
| Ally Bank | Best for Flexibility at Renewal | Competitive | $0 | 90 days’ interest |
*APYs are variable and change frequently — always confirm the current advertised rate directly on the bank’s website before opening a CD, since these rates can shift within weeks.
Below, we break down each option in detail, including exactly what makes each one worth considering.
CIBC Bank USA — Best Overall Rate With a Lenient Early Withdrawal Penalty
CIBC Bank USA currently offers one of the more competitive 1-year CD rates available, paired with an early withdrawal penalty that’s notably more forgiving than most competitors.
Key features:
- Competitive 1-year APY, among the higher nationally available rates
- $1,000 minimum deposit
- Early withdrawal penalty of just 30 days’ simple interest, compared to the more common 90-day penalty charged by most competitors on terms under a year — this is a meaningful advantage if your plans might change
- FDIC insured
Pros:
- One of the highest rates currently available on a straightforward 1-year term
- Notably lower early withdrawal penalty than most competitors
- Reasonable, accessible minimum deposit
Cons:
- Less name recognition than larger, more familiar banks
- Rate is variable and can shift with broader market conditions before you open the CD
Who it’s for: Savers who want the strongest available rate combined with a meaningfully lower penalty if they need to break the CD early.
Popular Direct — Highest Widely Available Rate
Popular Direct frequently tops rate-comparison lists for 1-year CDs, though it comes with a higher minimum deposit than most competitors on this list.
Key features:
- One of the highest advertised 1-year APYs among nationally available CDs
- $10,000 minimum deposit, notably higher than most competitors
- Standard early withdrawal penalty structure
Pros:
- Consistently ranks among the very highest rates for this specific term
- Backed by an established online banking division
Cons:
- $10,000 minimum deposit puts this out of reach for many savers
- Standard 90-day early withdrawal penalty, without CIBC’s more lenient structure
Who it’s for: Savers who already have $10,000 or more to deposit and want to capture the highest widely available rate for this term.
Marcus by Goldman Sachs — Best From a Recognized Big-Name Bank
If the idea of locking money away for a year feels more comfortable with a well-known institution behind it, Marcus offers a highly competitive rate without sacrificing much compared to lesser-known online banks.
Key features:
- Strong 1-year APY, close to the top rates available anywhere on this list
- $500 minimum deposit, more accessible than Popular Direct’s $10,000 threshold
- Daily compounding interest
- Marcus notifies you by email or letter 30 days before maturity, and the CD automatically renews unless you make changes to your maturity plan
Pros:
- Backed by Goldman Sachs’ long-established reputation in online banking
- Competitive rate with a much lower minimum deposit than some top-rate competitors
- Clear maturity notification process, reducing the risk of an unwanted automatic renewal
Cons:
- Standard 90-day early withdrawal penalty applies
- Rate is very slightly below the single highest nationally available options
Who it’s for: Savers who want a top-tier rate backed by a recognizable, established bank, without the high minimum deposit some competitors require.
Capital One — Best 1-Year CD With No Minimum Deposit
Capital One’s 1-year CD stands out specifically for accessibility: there’s no minimum deposit requirement at all, while still offering a rate well above the national average.
Key features:
- No minimum deposit requirement
- Competitive APY, meaningfully above the national average for this term
- Interest accrues daily and compounds/credits monthly
- Backed by a major, well-known national bank
Pros:
- No minimum deposit — the most accessible entry point among top-rate options
- Strong brand recognition and trust
- Solid rate despite the lack of a deposit threshold
Cons:
- Rate is competitive but typically a bit below CIBC’s or Popular Direct’s top offerings
- Standard 90-day early withdrawal penalty applies
Who it’s for: Savers who want to open a 1-year CD with any amount of money, without needing to hit a minimum deposit threshold to get a strong rate.
Bask Bank — Best Balance of Rate and Accessibility
Bask Bank, an online division of Texas Capital Bank, offers a strong 1-year rate with a moderate, accessible minimum deposit.
Key features:
- Highly competitive 1-year APY
- $1,000 minimum deposit
- Standard early withdrawal penalty structure
Pros:
- Strong rate that competes closely with the top nationally available offerings
- More accessible minimum deposit than Popular Direct’s $10,000 threshold
Cons:
- Less brand recognition than Marcus or Capital One
- Standard 90-day early withdrawal penalty, without CIBC’s more lenient terms
Who it’s for: Savers who want a top-tier rate with a moderate minimum deposit, without needing $10,000 to get started.
Ally Bank — Best for Flexibility at Renewal
Ally’s 1-year CD rate is competitive, but its standout feature is what happens as your CD approaches maturity, giving you meaningfully more flexibility than most competitors.
Key features:
- No minimum deposit requirement
- 10-day grace period at maturity, during which you can withdraw funds, change your CD term, or close the account entirely with no penalty
- Automatic 0.05% APY loyalty bonus added if you choose to renew the CD at maturity
- Standard 90-day early withdrawal penalty applies before maturity
Pros:
- Grace period at maturity adds genuine flexibility most competitors don’t offer
- Small loyalty bonus rewards savers who choose to renew rather than move their money elsewhere
- No minimum deposit required
Cons:
- Standard rate is solid but not always the single highest available for this specific term
- Early withdrawal penalty before maturity is the standard 90 days’ interest
Who it’s for: Savers who value flexibility at maturity — the ability to reconsider your term or withdraw without penalty during the grace period — over squeezing out the single highest rate.
Why the 12-Month Term Is the Most Popular CD Length
The 1-year CD sits at a practical sweet spot for a lot of savers:
- Long enough to earn a meaningfully higher rate than a savings account, which is variable and can drop at any time
- Short enough that your money isn’t locked away for years, making it easier to plan around
- Widely available, with more banks competing specifically for 1-year deposits than almost any other term, which tends to keep rates competitive
In the current rate environment, some shorter CDs (6-to-9-month terms) are paying similarly to or even slightly more than 1-year CDs at certain banks — an inverted pattern tied to expectations about future Fed rate moves. It’s worth comparing a few term lengths side by side rather than assuming the 1-year term automatically pays the most.
How We Chose These Accounts (Methodology)
To rank the best 12-month CD rates of 2026, we evaluated publicly available rate sheets directly from each bank, focused on:
- Advertised 1-year APY
- Minimum deposit requirements, since this varies significantly, from $0 to $10,000+
- Early withdrawal penalty structure, specifically flagging banks with a more lenient penalty than the common 90-day standard
- Flexibility features, such as grace periods at maturity or loyalty rate bonuses
- FDIC insurance status
How to Choose the Right 12-Month CD
If you want the strongest rate and can meet a higher deposit threshold: Popular Direct’s rate is among the highest available, provided you can meet its $10,000 minimum.
If you want a top rate with more accessible entry: Marcus by Goldman Sachs and Bask Bank both offer highly competitive rates with lower minimum deposits.
If you’re not 100% certain you won’t need the money before the year is up: CIBC Bank USA’s 30-day early withdrawal penalty is meaningfully more forgiving than the standard 90-day penalty most competitors charge.
If you want zero minimum deposit: Capital One and Ally Bank both let you open a 1-year CD with any amount of money.
If you like the idea of a grace period before deciding what to do next: Ally’s 10-day window at maturity, plus its small loyalty bonus for renewing, adds a layer of flexibility most competitors don’t offer.
Frequently Asked Questions
Is a 1-year CD better than a high-yield savings account right now? It depends on your outlook. A 1-year CD locks in today’s rate for the full term, protecting you if rates fall. A high-yield savings account has a variable rate that could rise or fall, but keeps your money fully accessible without an early withdrawal penalty. Given the modest rate difference at the moment, a savings account may make more sense if you value flexibility over locking in a rate.
What happens if I need to withdraw money from a 1-year CD early? You’ll pay an early withdrawal penalty, most commonly calculated as 90 days of interest at the CD’s rate, though some banks like CIBC Bank USA charge a smaller 30-day penalty. Always check a bank’s specific penalty structure before opening a CD.
Do 1-year CDs automatically renew? Many do, unless you take action before or during a grace period at maturity. Ally Bank, for example, offers a 10-day grace period during which you can withdraw, change your term, or close the account before it renews automatically.
Are CD rates likely to fall over the next year? The Federal Reserve has held its benchmark rate steady through much of 2026 after several rate cuts in late 2025. Whether rates fall further depends on future Fed decisions, which are influenced by inflation and broader economic data. Locking in today’s 1-year rate protects you from any decline that might happen during your CD’s term.
Is my money safe in a 1-year CD? Yes, as long as the issuing bank is FDIC-insured, your CD is protected up to $250,000 per depositor, per bank — the same protection as a checking or savings account.
Should I choose a brokered CD instead of a bank CD? Brokered CDs, purchased through a brokerage account, can sometimes offer competitive rates and the ability to sell before maturity on the secondary market — but their value can drop below your purchase price if sold early, unlike a standard bank CD held to maturity. Compare both options and confirm FDIC or NCUA backing before choosing either.
Bottom Line
For the strongest overall combination of rate and flexibility, CIBC Bank USA stands out thanks to its competitive APY paired with an unusually lenient 30-day early withdrawal penalty. If you want the highest widely available rate and can meet a larger deposit requirement, Popular Direct is worth a look. And if accessibility matters most, Capital One and Ally Bank both let you open a competitive 1-year CD with no minimum deposit at all.
Whichever bank you choose, confirm the current advertised APY and early withdrawal penalty directly on the bank’s website before opening a CD, since rates shift with the broader interest rate environment.
This article is for informational purposes only and does not constitute financial advice. BankNavigatorr may receive compensation from some of the providers mentioned through affiliate partnerships, which does not influence our editorial rankings.