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  • Written By
    Christian Simmons

    Christian Simmons

    Financial Writer and Certified Educator in Personal Finance

    Christian Simmons is a financial writer who has worked professionally as a journalist since 2016. As an active member of the Association for Financial Counseling & Planning (AFCPE), Christian prides himself on his ability to break down complex financial topics in ways that Annuity.org readers can easily understand.

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    Lamia Chowdhury
    Lamia Chowdhury

    Lamia Chowdhury

    Financial Editor

    Lamia Chowdhury is a financial editor at Annuity.org. Lamia carries an extensive skillset in the content marketing field, and her work as a copywriter spans industries as diverse as finance, health care, travel and restaurants.

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    Stephen Kates, CFP®
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    Stephen Kates, CFP®

    Founder of Clocktower Financial Consulting

    Stephen Kates is a Certified Financial Planner™ and personal finance expert specializing in financial planning and education. Stephen has expertise in wealth management, personal finance, investing and retirement planning.

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  • Updated: August 8, 2023
  • 7 min read time
  • This page features 4 Cited Research Articles
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How to Cite Annuity.org's Article

APA Simmons, C. (2023, August 8). The Best IRA CDs. Annuity.org. Retrieved June 15, 2024, from https://dev.annuity.org/personal-finance/banking/certificate-of-deposit/best-ira-cds/

MLA Simmons, Christian. "The Best IRA CDs." Annuity.org, 8 Aug 2023, https://dev.annuity.org/personal-finance/banking/certificate-of-deposit/best-ira-cds/.

Chicago Simmons, Christian. "The Best IRA CDs." Annuity.org. Last modified August 8, 2023. https://dev.annuity.org/personal-finance/banking/certificate-of-deposit/best-ira-cds/.

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Our Criteria

When examining banks, Annuity.org’s editorial staff set several criteria that needed to be met for a bank to be considered. Each bank must:

  • Be federally insured.
  • Offer IRA CDs. 
  • Rank in the top 30 of chartered commercial banks by consolidated assets. 

Our Methodology

Annuity.org employed a strict and research-focused methodology when selecting banks for consideration. In order to be considered, a bank needed to be federally insured, offer IRA CDs and rank in the top 30 banks by consolidated assets.

This helped guarantee that only the strongest and most stable options were considered.

Banks were then compared by their specific IRA CD offerings, the consistency of those offerings, APY and minimum deposit.

It’s important to note that CD rates can vary by location. So, the rates presented for each bank or IRA CD may differ for you depending on what part of the country you live in. 

Annuity.org focused on the top 30 banks by consolidated assets in part to ensure that the options considered are widely available to consumers.

Learn more about our broader editorial guidelines.

Our Picks

Editor’s Choice: Best Overall

GREAT FOR: Low Minimum Deposits

Bank Details

Originally founded in 1919 as a division of GM, Ally Bank is one of the 25 largest banks in the country with over $186 billion in consolidated assets. Ally Bank is entirely online, meaning that is has no physical branches anywhere in the U.S. 

Pros

  • No minimum deposit
  • Strong rates across multiple terms

Cons

  • No physical locations 

Our Take

Ally Bank stands out among the rest when it comes to IRA CD offerings for several key reasons. The first is the simple fact that Ally offers rates on its IRA CDs that are significantly higher than many competitors. APYs exceed 4% on terms that range from nine months to five years. Some competing banks offer just a fraction of that return.

Another key benefit is the lack of a minimum deposit. Most competitors require some sort of minimum to open an IRA CD, and for many competitors, it can be significant. That is not the case with Ally. The bank’s strong rates are even available for smaller CD investments.

One drawback to be aware of is that, while Ally has many great offerings, it does not have any physical branches and operates entirely as an online bank. This can be a leap for those who only have experience with more traditional banks.

Best for Multiple IRA Options

GREAT FOR: Various Retirement Strategies 

Bank Details

BMO Harris is one of the 15 largest banks in the country, with consolidated assets exceeding $265 billion and over 1,000 domestic branches. It offers a strong variety of IRA CD options.

Pros

  • Strong diversity of IRA CDs
  • Solid APYs for smaller balances  

Cons

  • High minimum deposit

Our Take 

It’s no secret that there are multiple types of IRAs that appeal to different personal finance situations. But this isn’t always the case regarding IRA CDs since they are not a particularly mainstream product. It’s not unusual for banks to offer just a few options.

BMO Harris stands out for its diversity. The bank offers regular IRA CDs, ROTH IRA CDs and even SEP IRA CDs. That diversity also carries into terms, with offerings ranging from three months to five years.

The bank generally offers a strong APY on its IRA CDs as well, including for smaller balances. For example, a $1,000, 12-month IRA CD can come with an APY of 5.1%.

While its rates and diversity of offerings are attractive, BMO Harris does require a $1,000 minimum, which can be higher than some competitors.

Best for High Rates Across Many Terms

GREAT FOR: Consistently Strong Rates 

Bank Details

Discover clocks in as one of the 30 largest banks in the country with $130 billion in consolidated assets. The bank is entirely online with no physical branches but does trace its origins back over a century and is a reliable choice.

Pros

  • Strong APYs
  • Both Roth and traditional options

Cons

  • Very high minimum deposit 
  • No physical branches

Our Take

It’s not unusual for a bank to offer a strong rate on at least a handful of terms. Discover stands out thanks to favorable rates on virtually all its IRA CD terms.

An APY of at least 2% is available on all options, with many choices exceeding 4%. While the bank doesn’t go as far as BMO Harris in diversity, it does offer both traditional and Roth options as well, appealing to a wider range of customers. 

The one drawback of the attractive rates is the $2,500 minimum deposit, which is significantly higher than most competitors. Discover also does not have any physical branches. 

Best for Smaller Minimums

GREAT FOR: Low Minimum Deposits

Bank Details

TD Bank is one of the 10 largest banks in the U.S., eclipsing $400 billion in consolidated assets and with more than 1,100 branches. The bank has strong CD offerings for existing members.

Pros

  • Minimum balance of just $250
  • Strong APYs for existing members

Cons

  • Rate bump feature only for members

Our Take 

TD Bank offers some of the lowest minimum balances available, requiring just $250 to open an IRA CD while providing traditional and Roth options. On top of the low minimum deposit, generally, high APYs are offered as well.

The drawback is that there is a notable cutoff in value for those who are not already TD Bank members. If you already have a TD Bank checking account when you open your CD, you are eligible for a sizeable rate bump. This makes TD Bank an enticing option, but largely for those who are already affiliated with the bank.

Others We Considered

The following banks were considered but were not selected due to varying reasons. While meeting our criteria, they either did not offer competitive IRA CD rates, have ceased offering them entirely or did not provide readily available information on their rates.

Frequently Asked Questions

What is an IRA CD?

An IRA CD is an IRA that is invested entirely in CDs, combining the benefits of both.

What are the benefits of investing in an IRA CD?

An IRA CD can be beneficial by combining the retirement aspects of an IRA with the low-risk components of investing in a CD.

How do IRA CD rates compare to regular CD rates?

It varies by bank, but IRA CD rates tend to not be all that different from standard CD rates.

What factors should I consider when choosing an IRA CD?

The APY offered, the term lengths available and the minimum deposit required are all factors to considered when selecting the right IRA CD.

Are there any penalties for withdrawing funds from an IRA CD before the maturity date?

As with standard CDs, there can be penalties for attempting to withdraw money before the term has ended.

Please seek the advice of a qualified professional before making financial decisions.
Last Modified: August 8, 2023

4 Cited Research Articles

Annuity.org writers adhere to strict sourcing guidelines and use only credible sources of information, including authoritative financial publications, academic organizations, peer-reviewed journals, highly regarded nonprofit organizations, government reports, court records and interviews with qualified experts. You can read more about our commitment to accuracy, fairness and transparency in our editorial guidelines.

  1. Federal Reserve. (2023, May 22). Large Commercial Banks. Retrieved from https://www.federalreserve.gov/releases/lbr/current/
  2. Ally. (n.d.). IRA High Yield Certificate of Deposit. Retrieved from https://www.ally.com/bank/ira/high-yield-cd/
  3. BMO Harris. (n.d.). IRA Certificates of Deposit. Retrieved from https://www.bmo.com/en-us/main/personal/investments-and-retirement/ira-cds/?zipcode=32828
  4. Discover. (n.d.). IRA Certificate of Deposit. Retrieved from https://www.discover.com/online-banking/retirement/ira-cd/#SureSaving