Bank of America CD Rates for January 2024
Bank of America Featured Certificates of Deposit are available in five periods ranging from seven to 37 months. The bank’s CD rates are typically substantially lower than the best CD rates offered by internet banks: With a $1,000 minimum initial deposit, BofA offers rates as low as 0.05% annual percentage yield (APY) on select terms of its Featured CDs. Depending on the period, some Bank of America Featured CDs provide APYs as high as 5.00%.
Bank of America also offers Fixed-term CDs with terms ranging from one month to ten years. Bank of America Fixed duration Certificates of Deposit require a $1,000 minimum deposit and give APYs ranging from 0.03% to 4.00% based on duration and balance. Another choice is the Bank of America Flexible Certificate of Deposit, which has a 12-month term and a rate of 3.51% APY for a $1,000 minimum deposit.
Here’s a look at Bank of America’s CD rates. This article concentrates on Bank of America’s Featured CDs, which have a higher annual percentage yield. The rates are current as of January 3, 2024.
Overview of Featured CD Accounts
These CDs are among the highest-earning products from Bank of America. Terms range from seven to thirty-seven months. These CDs automatically renew into fixed-term CDs after the term expires. Bank of America’s 10- and 37-month CDs have modest interest rates, but the seven- and 13-month durations have the greatest APYs.
| Fixed Term CD Account Overview
These are ordinary CDs from Bank of America. Each has a set time that can range from one month to ten years. These CDs’ APYs are often lower than those of featured CDs. |
||
|---|---|---|
| CD Term | APY | Deposit |
| 1–120 months | Varies | $1,000+ |
Bank of America CDs: Key Features
| Featured CD Key Features | |
|---|---|
| APY Range | 0.05%–5.00% |
| Minimum Deposit | $1,000 |
| Term Range | 7–37 months |
| Early Withdrawal Penalty | 7–365 days’ worth of interest, depending on term |
Bank of America’s Featured CDs are identical to its ordinary Fixed CDs, except they offer higher rates for specific deposit levels and may only be available for a limited period. Higher APYs and shorter-term alternatives are appealing, but a $1,000 minimum deposit is required, and early withdrawal penalties can be significant.
The overall penalty for early withdrawal is determined by the period of your CD. For example, if you take your funds early from a 7- or 10-month CD, you will be charged three months’ interest. However, if you remove your money before the end of the term on a 13-, 25-, or 37-month CD, you will be charged 180 days of interest.
Customers who want to open a promotional Featured CD or a conventional Fixed CD from Bank of America can do so online or in person. However, if you put more than $250,000 in a CD account, you may be unable to open it online.
To get started, you may need to visit a local bank (and keep in mind that deposits over $250,000 are often not FDIC-insured).
| Fixed CD Key Features | |
|---|---|
| APY Range | Varies |
| Minimum Deposit | $1,000 |
| Term Range | 1–120 months |
| Early Withdrawal Penalty | 7–365 days’ worth of interest, depending on term |
The Bank of America Fixed CD has terms that few competitors can match. Terms might be as short as one month or as long as ten years. In most cases, the APY is quite low, unlike the Featured CD, albeit some term lengths are comparable.
Minimum deposit requirements and early withdrawal penalties might be rather substantial as well. Like with the Featured CD, the early withdrawal penalty is determined by the CD period. For terms of more than five years, for example, you will pay one year’s interest on any amount withdrawn early.
Flexible CDs
Bank of America provides a one-year term on its flexible CD account. This form of CD allows you to withdraw your principal balance and any interest before the maturity date as long as you do so at least seven days after opening your account or making a withdrawal. It, like the highlighted CDs, has a greater interest rate than the bank’s fixed-term CDs.
About Bank of America CDs
Bank of America’s Featured CDs have a $1,000 minimum beginning balance, which is rather costly but may be worthwhile if you choose a term with a higher APY. Many other banks provide better APYs while having a lower or no minimum deposit.
Notably, Bank of America’s Featured CDs have unusual terms, often one month longer than the norm. For example, the bank provides a seven-month CD rather than the more normal six-month term. It also offers a 13-month CD instead of a 12-month CD.
Interest on CDs is compounded monthly and credited to your account every month. You can also choose to receive interest at maturity or predetermined intervals.
If you pull your money out of the CD before the term is over, you’ll have to pay an early withdrawal penalty. The early withdrawal penalty for CD terms of 90 days to 12 months is 90 days’ worth of interest on the amount withdrawn. The early withdrawal penalty for CD terms of 12 to 60 months is 180 days of interest on the amount withdrawn.
Alternatives to Bank of America CDs
Numerous other banks and credit unions provide high-yield CDs that are worth investigating. You should also think about different types of accounts.
Other CD Options
The top Featured CDs from Bank of America provide above-average rates, but they don’t quite match the greatest CD rates in the country. CDs with rates of 5.50% APY or higher for comparable terms are available from online banks and credit unions.
If you’re used to banking online, consider CDs from an online bank, which typically feature lower minimum deposit requirements and greater interest rates. If you prefer to bank in person but still want the best rates, consider CDs from your local credit union.
High-Yield Savings Accounts
Money Market Accounts
Series I Bonds
1. High-Yield Savings Accounts
One disadvantage of CDs is that you must lock away your money for a set length of time. If you need cash before the end of your CD term, you’ll almost certainly have to pay an early withdrawal penalty. Consider a high-yield savings account if you want more flexible access to your money while still receiving FDIC insurance and earning a competitive APY.
The finest high-yield savings accounts provide rates that exceed 5.00% APY, delivering a higher yield and greater flexibility than Bank of America CDs.
2. Money Market Accounts
A money market account is another type of savings account that can offer high rates, FDIC insurance, and the ability to withdraw funds at any time. This type of account is not available at every bank or credit union, but they are not difficult to find.
Money market accounts function similarly to savings accounts in that they produce interest, are insured by the FDIC, and can be withdrawn without penalty. Furthermore, some money market accounts include check-writing and debit card access, allowing you to use them for one-time payments.
The finest money market accounts offer interest rates that exceed 5.00% APY. Money market accounts may be the ideal option if you want to maximize your savings yield without the restrictions of a CD.
3. Series I Bonds
CDs have fixed APYs for the life of the term, but if you’re concerned about how fluctuating interest rates will affect your entire CD strategy, try opening a Series I bond instead. These bonds are intended to protect you from inflation. They earn a fixed rate of interest as well as a variable rate that adjusts every six months to account for inflation.
Additional Ways To Save With Bank of America
Bank of America does not provide money market accounts, however it does provide the Advantage Savings account. This isn’t a high-yield savings account, but if you link it to a Bank of America personal checking account, you’ll receive a greater APY through the Preferred Rewards program.
In addition, you must keep a three-month combined minimum balance in your investing and deposit accounts. The greater your total amount, the greater the APY on your Advantage Savings account.
- Gold tier: Combined average daily balance of $20,000 to less than $50,000
- Platinum tier: Combined average daily balance of $50,000 to less than $100,000
- Platinum Honors tier: Combined average daily balance of $100,000 to less than $1 million
- Diamond tier: Combined average daily balance of $1 million to less than $10 million
After the first six months, Bank of America’s Advantage Savings account charges a $8 monthly fee. If you meet one of the following criteria, the price may be waived:
- Maintain a daily balance of at least $500.
- Connect it to your Advantage Relationship Banking® account.
- Have a Preferred Rewards account?
- Have an account holder that is under the age of 18
- Have a student under the age of 25 as the account owner.
Pros and Cons of Bank of America CDs
Higher APYs and shorter-term alternatives are appealing, but a $1,000 minimum deposit is required, and early withdrawal penalties can be significant. Customers who want to open a promotional Featured CD or a conventional Fixed CD from Bank of America can do so online or in person.
Pros Explained
CDs can be opened online or in person
Flexible “no-penalty” CD option available
Strong ratings for financial advice
1. CDs can be opened online or in person:
Customers can open CDs fully online if they deposit less than $250,000, but Bank of America also has over 3,900 financial centers countrywide for customers who prefer in-person banking assistance.
2. Flexible “no-penalty” CD option available:
Most CDs lock your money into the account for the specified duration. If you remove funds too soon, the bank will charge you a steep penalty. Your money, however, is more accessible with Bank of America’s flexible no-penalty CD option. You cannot withdraw funds for the first six days after opening your account, but after that, you can withdraw both the principal and interest without penalty.
3. Strong ratings for financial advice:
In the 2023 J.D. Power U.S. Retail Banking Advice Satisfaction Study, Bank of America was the top-rated bank based on the individualized financial advice it offered to consumers, defeating 13 other large banks. The survey assessed customers’ satisfaction with financial advice provided by banks about their products and services.
Cons Explained
Can usually find higher rates elsewhere
High minimum deposit requirement
Higher rates only on some deposit amounts and terms
Costly early withdrawal penalties apply
1. Can usually find higher rates elsewhere:
Although some of Bank of America’s CD terms are competitive, they rarely equal the greatest available APYs. Compare the greatest CD rates here to see how much you may earn.
2. High minimum deposit requirement:
Some banks enable you to open a CD with as little as $1, while Bank of America has a far higher minimum deposit requirement of $1,000 to open an account. The large deposit minimum may be a deterrent for people who do not have a lot of cash on hand.
3. Higher rates only on some deposit amounts and terms:
Although Bank of America promotes higher-than-average CD rates, the higher rates only apply to certain terms and deposit amounts (this is true for many, but not all, institutions). In all other respects and amounts, the rates are lower than the national average.
4. Costly early withdrawal penalties apply:
Early withdrawal penalties are common for CDs, but Bank of America’s penalties are above the industry average. Aside from the no-penalty CD, the penalty ranges from 7 to 365 days of interest based on the kind of account and duration.
Bank of America CD: Additional Information
For more information about CDs, we chatted with Mary Hines Droesch, Head of Consumer and Small Business Products at Bank of America.
While Bank of America offers a variety of CD terms and APYs, you need also to consider early withdrawal penalties, required deposits, and compounding schedules. These specifics for Bank of America CDs are provided below.
Early Withdrawal Penalties
Minimum Deposit
Compounding Schedule
1. Early Withdrawal Penalties
If you pull money out of a Bank of America featured or fixed-rate CD before the maturity date, you will be penalized. The amount of interest you must pay is determined by the term length of your CD.
CDs with terms of less than 90 days:
CDs with terms of 90 days to one year
CDs with terms of one to five years:
CDs with terms of more than five years:
1. CDs with terms of less than 90 days:
You pay the greater of seven days’ interest or the total amount removed in interest.
2. CDs with terms of 90 days to one year:
You pay interest on the amount removed for 90 days.
3. CDs with terms of one to five years:
You pay interest on the amount removed for 180 days.
4. CDs with terms of more than five years:
You pay interest on the amount removed for 365 days.
If you start a flexible CD with Bank of America, there are no early withdrawal penalties unless you take money out within six days of opening the account.
2. Minimum Deposit
Bank of America has a $1,000 minimum initial deposit for all CDs. This is somewhat in the center when compared to other financial institutions, as some have greater minimum deposit amounts and others do not.
3. Compounding Schedule
Bank of America offers two different compounding schedules. Interest is applied at maturity if you have a CD with a period of 27 days or less. Interest is compounded monthly and credited to your account at the end of each month or on the schedule you specify for CDs with durations of 28 days or more.
How Much Can You Earn With Bank of America’s CD Rates?
Expect little return because Bank of America’s CD rates are generally low across terms. Enter the following figures into our CD calculator to see how much you may earn with Bank of America’s CDs:
How Bank of America’s CDs Compare
The majority of Bank of America’s CD returns are significantly lower than the best CD rates. According to the FDIC, this bank’s lowest CD rates are likewise much lower than the national average CD rates. On the other hand, several of Bank of America’s Featured CDs offer APYs that are competitive with the top CDs on the market.
This is a wonderful reminder to shop around and compare CD rates. Because your local bank or banks may not have the best CD rates, look into online possibilities as well. Compare rates from several banks and credit unions to find who can provide you with the greatest deal and the largest possible return on your investment.
How To Open a CD Account With Bank of America
If you’re ready to open a Bank of America CD account, you can do so online, over the phone, or in person by following the steps below.
Online
By phone
In-person
1. Online:
- Go to the Bank of America CDs page.
- Choose the “Get started” button under the type of CD you want to get.
- Select your desired term and opening deposit amount.
- Complete the online application.
2. By phone:
- Contact Bank of America by phone at 844-375-7027.
3. In-person:
- Go to a Bank of America branch near you to open an account in person.
What is the current CD rate for Bank of America?
Bank of America CD rates vary depending on the type of CD, length, and amount deposited. Rates for the Featured CDs range from 0.05% to 5.00% APY, 0.03% to 4.00% for Fixed-term CDs, and 3.51% for the Flexible CD. The best Bank of America CD rates are on Featured CDs with periods of seven and thirteen months.
What are some alternatives to saving with CDs?
A savings account is one option for storing your savings in a secure location. Although savings accounts are FDIC-insured, these demand deposit accounts have no early withdrawal penalty. And, if you select one of the top online savings accounts, you may be able to earn a higher APY than you would with a CD.
Do all CDs charge an early withdrawal penalty?
It is determined by the type of CD and the financial institution. Some banks provide no-penalty CDs, which are CDs that do not include an early withdrawal penalty. The APY on no-penalty CDs may be lower than on conventional CDs, depending on the bank—you may have to accept a lesser yield in exchange for increased liquidity.
What is a CD ladder strategy?
A CD ladder is a savings strategy that involves opening multiple CDs with varied terms and maturity dates to maximize your interest and provide additional liquidity. The idea is to capitalize on increased interest rates by locking in a selection of CDs that provide a range of yields over time. Rather than placing all of your eggs in one basket with a single CD and a single fixed rate, a CD ladder can allow you to take advantage of higher rates while avoiding early withdrawal penalties. Do your homework to locate the greatest CD ladder rates, terms, and minimum deposits.
How Often Does Bank of America Change Its CD Rates?
Because individual banks determine their deposit account rates, it’s impossible to predict how frequently rates will vary. However, when you open a new CD, you will often receive a set rate for the term. So, even if interest rates fall, the rate on your CD account will not fall throughout the period.
Is There a Maximum Deposit for Bank of America CDs?
The maximum deposit amount for Bank of America CDs is not disclosed. It has a $1,000 minimum deposit, and if you want to deposit more than $250,000, you may need to open an account in person.
Also, deposits of $250,000 or more at any one financial institution are not insured by the Federal Deposit Insurance Corporation, which safeguards your money in the event of a bank failure.
Does Bank of America Charge an Early Withdrawal Penalty for CDs?
Are CDs at Bank of America FDIC-Insured?
Yes, Bank of America CD accounts are FDIC-insured up to a maximum of $250,000.
Who Are Bank of America CDs Best For?
CDs from Bank of America are ideal for people seeking a flexible alternative to a traditional bank. Most CDs prohibit you from touching your money for the duration of the CD term without incurring costly penalties. However, you just have to leave the money alone for six days after opening the account with Bank of America’s flexible CD. After you’ve met that condition, you can withdraw the principal and interest at any time without penalty.
Because of this feature, the flexible CD is a reasonable compromise between standard CDs and savings accounts; you lock in the higher APY of the CD for the remainder of its term, but you can still use the account if an unforeseen expense arises and you require cash immediately.
How Much Does Bank of America Charge for CDs?
In conclusion
With Bank of America CD rates topping competitors’ rates for some maturities, a featured or flexible CD could be well worth it. However, the APY on many of the bank’s fixed-term CDs is less than 1%.
“If you’re looking for a stable investment that can provide guaranteed returns, CDs can be a great addition to other assets you have in your investment portfolio, such as stocks and bonds,” said Droesch. “They can be a smart way to save for long-term goals while avoiding the risk of market downturns, especially for those who have riskier assets in their portfolio.”