Best 6-Month CD Rates of October 2024: Earn Over 5%
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Best 6-Month CD Rates for October 2024: Up to 5.10%

  • Six-month CDs offer a short-term commitment with fixed, predictable returns at higher interest rates than traditional savings accounts.
  • This makes them ideal for achieving short-term financial goals while maximizing your earnings.
  • FDIC data shows that the average APY for six-month CDs is currently around 1.81%.
  • Some CDs, however, offer APYs over 5%. This creates an opportunity to earn significantly higher returns on your investment.
  • We recommend six-month CDs from Barclays, BMO Alto, Marcus and Quontic.

Our top picks for CD rates

Compare our picks for the best 6-month CDs

Bank APY Min deposit Compounding frequency
Barclays 5.10% $0 Daily
BMO Alto 5.70% $0 Monthly
Marcus 4.75% $500 Daily
Quontic 4.60% $500 Daily
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Barclays 6-month CD
LEARN MORE FDIC insured
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APY
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Term Length
6 months
Minimum Opening Deposit
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Why We Like It

Editor's take

The Barclays 6-month CD is a great option for short-term savers seeking both flexibility and growth. It offers a competitive interest rate without locking your money away for too long, and its daily compounding feature allows your balance to grow faster than accounts with monthly or annual compounding. Plus, with no maintenance fees or minimum balance requirements, it’s accessible to a wide range of savers.

Since Barclays operates entirely online, there are no physical branches. However, if you’re comfortable managing your finances digitally, this CD provides a convenient blend of growth potential and easy access to your funds.

PROS

  • Competitive APY
  • No minimum deposit required
  • Initial deposit isn’t due until 14 days after account opening
  • Insured by the FDIC

CONS

  • Must maintain a balance that would earn at least 1 cent if you want the interest to post to your account
  • Early-withdrawal penalty
  • No physical branch locations

BMO Alto

Why we like it

BMO Alto delivers the best six-month CD interest rate, accelerating your short-term savings growth. With no minimum deposit requirement and a high APY, this 5% CD is an excellent choice for savers at any level.

BMO Alto 6-month CD: An overview

APY Minimum deposit Compounding frequency
5.80% $0 Monthly

*Figures are correct as of September 2024.

Marcus

Why we like it

Marcus by Goldman Sachs provides a reputable option for savers seeking a competitive return on a six-month CD. It offers some of the best CD rates, as well as a unique advantage of a rate guarantee. Even if interest rates dip before your CD matures, you’re assured of earning the APY you were offered at the time of opening.

Marcus 6-month CD: An overview

APY Minimum deposit Compounding frequency
4.75% $500 Daily

*Figures are correct as of September 2024.

Quontic

Why we like it

Quontic Bank has a relatively low minimum deposit requirement, making it accessible to savers at various levels. Thanks to its high APY and daily compounding interest, Quontic is one of the best options for making your funds work harder for you.

Quontic 6-month CD: An overview

APY Minimum deposit Compounding frequency
4.60% $500 Daily

*Figures are correct as of September 2024.

What is a 6-month CD?

A six-month CD is a type of savings account that helps your money grow faster without tying it up for years. However, there’s a catch. You can’t touch that money for six months. In exchange for your patience, the best CDs reward you with a higher interest rate than you would typically get from a regular savings account.

Who benefits most from a six-month CD?

How do 6-month CD rates work?

Let’s demystify how a CD impacts your hard-earned money:

Withdrawing funds before the maturity date usually comes with a penalty from the bank. These penalties will offset some or all of the interest earned, so be very careful. A six-month CD is best suited for money you’re confident you won’t need within that time frame.

6-month CD rates today

Past interest rate hikes from the Federal Reserve led to higher CD rates, but recent stabilization could see CD rates drop in the coming months. In a poll of 100 economists by Reuters, the majority said the Fed will wait until September 2024 to cut interest rates, which have held steady at 5.25% and 5.50% for a while.

As such, now’s the time to lock in high CD yields before it’s too late. If the Fed cuts interest rates, CD rates will likely follow. Unless your CD has a fixed APY, your CD’s interest rate will drop. If banks earn less interest on loans, they’ll have less money to reward savers via high-yield accounts such as CDs.

Pros and cons of 6-month CDs

Considering a 6-month CD? Here’s a Breakdown of the pros and cons.

Pros
  • Guaranteed return on your investment for the term
  • Low risk of losing money compared to stocks
  • Potentially higher interest rates than a traditional savings account
  • Less restrictive than longer-term CDs
Cons
  • Lower interest rates than longer-term CDs and savings accounts
  • Limited access to your money until the term ends
  • Potential for interest rates to decrease during the six months

How much can you earn with a 6-month CD?

APY can be somewhat misleading when it comes to CDs with terms shorter than a year. Keep in mind, APY is an annual percentage, and you’re looking at a six-month investment.

By using a CD calculator, you can see just how much you could earn with a six-month CD.

Let’s take a look at the estimated interest earnings if you invest $5,000 over six months with one of our top picks for six-month CDs:

Bank Name APY 6-month CD earnings on $5,000
Barclays 5.10% $126
BMO Alto 5.80% $143
Marcus 4.75% $117
Quontic 5.10% $126

APYs are correct as of September 2024. The calculations shown are just a simple example. Always seek advice from a qualified professional before making important financial decisions or long-term agreements.

How to choose the best 6-month CD rates

Choosing the right six-month CD can be a smart way to grow your savings while keeping money accessible in the near future. Here are the most important factors to look at when comparing different options.

APY

APY is the interest rate you’ll earn over a full year, expressed as a percentage. It’s essentially the growth rate of your savings in the CD. There’s a catch with six-month CDs, though. Unlike one-year CDs, as your money is locked up for half a year, you only earn half of the advertised APY.

For example, Barclays CD offers a 5.10% APY on a six-month CD. Over those six months, you’d actually earn around 2.5% interest on your deposit.

Early withdrawal penalty

An early withdrawal penalty is a fee your bank charges if you withdraw your money from the CD before the maturity date of six months. Penalties vary, but they always offset any interest you earn, so avoiding them is paramount.

Imagine you open a six-month CD with a $1,000 deposit and a 3% early withdrawal penalty. If you needed the money after three months and withdrew it, the bank might subtract three months’ worth of interest, around $15, as a penalty.

Compounding schedule

The compounding schedule reflects how often interest gets added back to your principal balance.

With daily compounding APY, your interest is calculated and added to your balance each day. This means you earn interest on your interest, creating a snowball effect. Weekly or monthly compounding are also good options, while simple interest, calculated once at maturity, is less advantageous.

The impact of compounding frequency is more noticeable over longer terms, but can still give your six-month CD earnings a small boost.

Safety

CDs offered by FDIC-insured banks and NCUA-insured credit unions are protected against bank failure, up to $250,000 per depositor, per insured institution. This guarantees you’ll get your money back, even if the bank encounters financial difficulties.

Peace of mind matters. Always confirm that your chosen bank or credit union is FDIC or NCUA-insured before opening a CD.

Minimum deposit requirement

Many CDs require a minimum deposit to open the account, but some have lower or even no minimum deposit requirements such as the Synchrony CD, making them more accessible. If you have several hundred dollars to save, look for a CD with a low or no minimum deposit requirement.

CD term

CD term is the length of time your money is locked up in the CD. While six-month CDs are a common option, you can also get three-month CDs or CDs with terms of several years.

Generally, CDs with longer terms offer higher APYs. That said, a six-month CD strikes a good balance between getting a better return than a regular savings account and making your money accessible soon.

How to open a 6-month CD

Opening a six-month CD is a straightforward process. Here’s what you can expect:

Is a 6-month CD worth it?

A six-month CD can be a smart financial move if:

Alternatives to a 6-month CD

Here are a couple of alternative savings options to consider, along with how interest rates typically stack up.

High-yield savings accounts

This type of savings account typically offers higher interest rates than a standard savings account. However, even the best high-yield savings accounts have APYs that are variable and could tank at any time.

Money market accounts

The best money market accounts provide higher-than-average APYs because banks use the funds for highly liquid, short-term and low-risk assets. The downside of a money market vs a savings account is that they usually come with higher minimum balance requirements.

FAQ: Best 6-month CD rates

Who offers the highest 6-month CD rates?

Six-month CD rates vary, but currently, BMO Alto has the highest rate. Quontic and Barclays also have high yields compared to other CDs.

Are there 6% CD rates?

It may be possible to find 6% CD rates, but rates fluctuate based on economic conditions. Instead of aiming for a specific number, focus on finding the best available rate at the time.

Is a 6-month CD worth it?

A six-month CD is a savvy choice if you have a short-term savings goal, as CDs vs savings accounts offer higher returns. Just be sure you won’t need the money before the term ends.

How is a 6-month CD compounded?

With CDs, interest is compounded daily, weekly or monthly. Daily compounding is the best as compounding interest is like earning interest on your interest. It’s often referred to as ‘interest on interest’ and can significantly boost your earnings over time, especially with longer investments.

What is the average rate of a 6-month CD?

According to the FDIC, the average rate of a 6-month CD is 1.82% APY. At this rate, a $10,000 CD would earn approximately $90 over the term, and a $50,000 CD would earn around $450.

About the Author

Imogen Sharma
Imogen Sharma Finance Contributor

Imogen Sharma is an experienced writer, specializing in business, culture, and financial guidance for young adults. She has contributed to articles for Varo Bank, Lendzi, MoneyTips and Indeed, providing invaluable insights into budgeting, financial planning, and lines of credit.

As a dedicated self-employed writer, she cherishes the opportunity to share her knowledge and experience with others, offering advice so they can master their bank accounts and secure their financial futures. Her articles, published in CMSWire, Reworked, WalletGenius and The Customer, serve as actionable guides to help people make solid financial decisions.

Prior to her writing career, Imogen honed her financial acumen in management roles, excelling in P&L analysis, budgeting and HR. During her tenure at Smith & Wollensky in London, her strategic contributions contributed to a 2% increase in EBITDA over a year, demonstrating her ability to drive financial performance and organizational success.

Imogen’s writing style combines expertise with accessibility, making complex financial topics easily understandable and actionable. With a focus on the long game, she encourages readers to approach financial matters with enthusiasm and determination.

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