It is typical for CDs to offer a higher yield for a longer term. The farther out the term goes, the less the bank is willing to boost the yield.
Using RateCatcher’s CD rate comparison tool, I calculated the ratio of yield to term for the most common CD terms.
The longest term CDs provided the worst ratios with the best 7 year CD coming in at 0.49.
The sweet spot is at the 1 year and 2 year CDs with ratios of 1.48 and 1.13 respectively. The 6 month CD is somewhat irrelevant because the current best money market account offers a better yield of 1.30% APY without any withdrawal restrictions.
You’ll notice the 2 year CD APY is the same as the 3 year CD APY. This is because iGObanking is offering a very competitive 2 year CD right now. ln fact the next best 2 year CD is only offering 1.79% APY from Bank of Internet.
Below is the chart of Yield/Term Ratios.
Yield/Term Ratios for the Best CD Rates:
| CD Term | Yield/Term Ratio | Yield | Bank/Credit Union |
| 6 Month CD | 1.15 | 1.15% APY | Bank of Internet |
| 1 Year CD | 1.48 | 1.48% APY | Bank of Internet |
| 2 Year CD | 1.13 | 2.25% APY | iGObanking.com |
| 3 Year CD | 0.75 | 2.25% APY | iGObanking.com |
| 5 year CD | 0.53 | 2.65% APY | First Internet Bank of Indiana |
| 7 Year CD | 0.49 | 3.49% APY | PenFed Credit Union |
