American Express offers a simple CD with decent rates
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American Express CD Rates
Although American Express is primarily known for its credit cards and charge cards, it also has several savings options, including high-yield savings accounts and a certificate of deposit (CD).
American Express CD rates are higher than the national average for some term lengths. It has no minimum balance requirement, making it particularly useful for those without substantial savings.
Important
The APYs listed below are up to date as of the date of publication of this article. We review CD rates every two weeks and update the information below accordingly.
American Express CD Overview
| CD Term | APY | Minimum Balance |
| 11 months | 4.75% | No minimum |
| 12 months | 4.00% | No minimum |
| 18 months | 3.25% | No minimum |
| 24 months | 4.00% | No minimum |
| 36 months | 3.00% | No minimum |
| 48 months | 3.00% | No minimum |
| 60 months | 3.00% | No minimum |
American Express’ CD accounts have fixed interest rates. Other options, such as variable-rate and no-penalty CDs, are not available through American Express.
See the best CD rates today before choosing the CD that is best for you.
American Express CD: Key Features
| APY Range | 3.00%–4.75% |
| Minimum Balance | No minimum balance |
| Term Range | 11–60 months |
| Early Withdrawal Penalty | 90–540 days’ interest |
| Grace Period at Maturity for Penalty-Free Withdrawals | 10 calendar days |
While some banks require you to deposit at least $2,500 or $5,000 to earn a higher yield on your CD, American Express has no minimum balance requirement. That feature makes it a good option for those who may have limited amounts to tuck away and so may not qualify for other CDs with high minimum balances.
American Express CD rates vary by term length, and it offers high rates on specific terms. Other terms have much lower rates.
Like other CDs, you cannot touch the money in the American Express account until its maturity date. Otherwise, early withdrawal penalties can range from 90 to 540 days’ interest.
However, American Express does allow you to withdraw some or all of the interest that’s been credited to the account before its maturity date. You can request a one-time payment of the interest to your savings account or opt to receive a check.
Important
American Express’ CDs require an upfront deposit, and you cannot add to the CD before its maturity date. If you want an account with more flexibility, you may want to consider a high-yield savings account.
Compare CD Account Rates
Several banks have rates higher than American Express, particularly for certain longer terms. And they often offer longer options, allowing customers to lock in their interest rate for as long as 10 years.
However, some banks have minimum balance requirements that can be quite high. American Express doesn’t, so it may be more attainable for those with limited cash reserves.
How Do You Get a CD With American Express?
You can open a CD online with American Express if you meet the following requirements:
- You must be at least 18.
- You must be a U.S. citizen or a resident alien with a valid Social Security number or an individual Taxpayer Identification Number with a U.S. address.
- You must use the account for personal use only.
The CD must be funded within 60 days. Otherwise, American Express will close the account.
Warning
Once your account reaches its maturity date, you have 10 days to withdraw funds. If you don’t, American Express will automatically roll over the account into a new CD, and any withdrawals will then be subject to early withdrawal penalties.
Are American Express CDs Worth Investing In?
As of publication, the rates on American Express CDs with certain terms were significantly higher than the national average. And because American Express doesn’t require a minimum balance, you can open a CD with a relatively small amount to take advantage of the higher yield or build a CD ladder. For other term options, other banks may offer better rates.
Are American Express CDs FDIC-Insured?
Yes, American Express CDs are backed by FDIC insurance on deposit amounts up to $250,000 per customer.
How Do You Get the Best CD Rate With American Express?
American Express CD rates depend on the term length rather than the amount of your deposit. Unlike many banks, a longer term doesn’t necessarily mean you’ll get a higher APY. Currently, American Express offers the best CD rates on CDs with relatively short terms.
If you’re looking for the highest APYs on the market, check out our picks for the best CD rates.
Your Guide to CDs
- What Is a Certificate of Deposit (CD)?
- What Is a Brokered CD?
- What Is a CD Ladder?
- Pros and Cons of CDs
- How to Invest With CDs
- How to Open a CD
- How to Close a CD
- CDs vs. Annuities
- CDs vs. Stocks
- CDs vs. Mutual Funds
- CDs vs. ETFs
- CDs vs. Savings Accounts
- Short-Term vs. Long-Term CDs
- CD Rates News
- Best 1-Year CD Rates
- Best 18-Month CDs
- Best Jumbo CD Rates
- Best 6-Month CD Rates
- Best 3-Month CD Rates
- Best Bank CD Rates
Read the original article on Investopedia.