Certificate of Deposit
Certificates of deposit (CDs) can be a good choice when you want steady, predictable investment income that is federally insured.1
Please Note: Certain conditions must be satisfied for FDIC insurance coverage to apply. Charles Schwab & Co., Inc. is not an FDIC-insured bank and deposit insurance cover the failure of an insured bank. Please visit the Schwab CD OneSource® page for a list of insured financial institutions that offer CDs through Schwab.
View current CD rates
Buying a CD in 5 Easy Steps
For steady, predictable income that is also FDIC-insured, many investors turn to CDs: certificates of deposit.
It's easy to find and purchase a CD that is right for you in just a few quick steps on Schwab.com
Start by logging in to your account and choosing Trade > CDs.
Select the account you'd like to use when purchasing your CD by checking the "Accounts" dropdown.
Now you can browse the highest yielding CDs from the many banks available through Schwab CD OneSource.
Each list includes a range of dates they may mature on.
Choose different timeframes and reorder the list by clicking coupon payment, maturity date, or Annual Percentage Yield.
Click on a bank name for a detailed description with information like maturity date, first coupon payment, settlement date, and how often you will receive interest.
Once you know which CD you'd like to purchase, click Buy.
This will bring you to order entry with all the relevant CD information pre-populated.
Here, review the details of the bank name, coupon, and maturity date,
and you'll just need to enter the total amount you'd like to invest in the CD.
Note that this field is already in the thousands, so enter accordingly.
Here, we're investing $50,000 so we'll enter "50"
Now you have the opportunity to choose whether or not you'd like to rollover, or reinvest, the proceeds from your CD once it's matured.
If you decide to rollover, you can also pick the new CD’s maturity timeframe.
Also note that CD orders are marked as a limit order to "Fill or Kill", meaning it will be cancelled if not filled immediately in its entirety.
When you're ready, click "Review Order"
If everything looks correct, including the total cost, click Place Order to complete your purchase.
During order verification you may see a screen with additional disclosures that apply to your selected CD.
Once you’ve reviewed, click "Continue"
You'll see an order acknowledgment where you can again confirm your trade details, and at any time you're logged into your Schwab account, you can check the order status of your CD by hovering over "Trade" and clicking "Order Status".
Find current rates and CDs that fit your fixed income needs by logging in at schwab.com/cd
Onscreen Text:
Important Disclosures
INVESTMENT AND INSURANCE PRODUCTS ARE: NOT FDIC INSURED • NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY • NOT A DEPOSIT OR OTHER OBLIGATION OF, OR GUARANTEED BY, THE BANK OR ANY OF ITS AFFILATES • SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED
The example is hypothetical and provided for illustrative purposes only. It is not intended to represent a specific investment product. Dividends and interest are assumed to have been reinvested, and the example does not reflect the effects of expenses, taxes, or fees, and if it had, performance would have been substantially lower.
Funds deposited at an FDIC-insured institution are insured, in aggregate, up to $250,000 per depositor, per insured institution based upon account type by the FDIC. The FDIC considers any other deposits you may have with an issuing bank. CDs you purchase from a particular bank are aggregated with any other deposits you may have with the issuing bank for determining FDIC insurance coverage (i.e., if you already have deposits of $250,000 with a bank, don't purchase CDs from the same bank in the same ownership category). Because the deposit insurance rules are complex, you may want to use FDIC's online tool, Electronic Deposit Insurance Estimator (EDIE), to estimate your total coverage at any particular bank.
Certificates of Deposit available through Schwab CD OneSource typically offer a fixed rate of return, although some offer variable rates. They are FDIC insured and offered through Charles Schwab & Co., Inc.
Please Note: Certain conditions must be satisfied for FDIC insurance coverage to apply. Charles Schwab & Co., Inc. is not an FDIC-insured bank and deposit insurance covers the failure of an insured bank. Please visit the Schwab CD OneSource® page for a list of insured financial institutions that offer CDs through Schwab.
Fixed income investments are subject to various other risks including changes in credit quality, market valuations, liquidity, prepayments, early redemption, corporate events, tax ramifications and other factors.
© 2024 Charles Schwab & Co., Inc. All rights reserved. Member SIPC. (1024-ZNAJ)
What is a Certificate of Deposit?
CDs are bank deposits that pay a stated amount of interest for a specified period of time and promise to return your money on a specific date. They are federally insured and issued by banks and savings-and-loans institutions.
Because they are generally considered safe, CDs can be a considerable addition to the fixed income portion of an investment portfolio.
What are the benefits and risks of a CD?
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Certificates of Deposit benefits and risks Benefits Risks Steady and predictable – Lock in an interest rate for a set period of time, while also generally providing a better interest rate of return than a savings account. Broad selection – Choose from different account types and from terms that range from 1 month to 20 years.Insure more money using FDIC coverage – Current FDIC coverage insures each individual bank up to $250,000 per depositor1. Certain conditions must be satisfied for FDIC insurance coverage to apply.Market risk – The most common risk is that you will need your funds before the CD matures. Although there are no early redemption fees, you may receive less than your original purchase price. Call risk – For callable CDs, the issuer can redeem, or "call," your CD from you for the full amount before it matures. The risk is that the issuer will exercise a call option at an unfavorable time for the holder, such as when interest rates decline.
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Current CD rates available through Schwab CD OneSource®
See below for a selection of today's CD rates2,3
| Maturity | 3 Month CDs | 6 Month CDs | 9 Month CDs | 1 Year CDs | 18 Month CDs | 2 Year CDs |
|---|---|---|---|---|---|---|
| Rates up to | 4.27% APY | 4.14% APY | 4.12% APY | 4.35% APY | 4.10% APY | 4.40% APY |
Looking for other cash solutions to help you reach your goals?
See rates for cash products at Schwab and compare the features and benefits of each.
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Manage exposure to interest rate fluctuations with a CD ladder.
A CD ladder is a type of fixed income investment strategy that uses a portfolio of individual CDs which mature on different dates. With brokered CDs, avoid trying to time the market.
Talk to a Schwab Fixed Income Specialist.
Our specialists offer objective, non-commissioned guidance on a wide range of fixed income products and strategies including ladders, bullets, barbells, and more. You can expect personalized service on topics such as:
- Help with choosing from a wide variety of investment options
- Suggestions for adjusting to changing market conditions
- Assistance with using our online trading features
Call 877-903-8069
Have a specialist contact you.
Common questions
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No, as long as you hold it to maturity and don't exceed FDIC insurance limits. CDs are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per bank per depositor or per account type. Certain conditions must be satisfied for FDIC insurance coverage to apply. In the event of a bank failure, holders of CDs issued by the failed institution would be covered up to the FDIC limits, while any amount above those limits would depend on the residual value, if any, of the financial institution. Additionally, brokered CDs can usually be sold prior to maturity. It's possible to receive an amount below the original investment amount if a CD is sold prior to maturity, depending on market conditions.
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CDs generally pay a fixed rate of interest based on the current economic environment. The timing of the payments can vary, but most CDs tend to pay interest monthly, semiannually, or at maturity.
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A ladder strategy helps investors stay invested and takes the guesswork out of timing. If interest rates rise, maturing CDs can be reinvested at higher yields. If interest rates fall, the interest earned from the existing CDs would likely be higher than market interest rates. A CD ladder doesn't take away interest rate risk – but it allows investors to stay invested regardless of interest rates are rising or falling.
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There are a number of ways to manage your cash holdings. Learn about more options for your Cash Investments here. For example, Money market funds are one way to keep your investments liquid while earning interest, but they have their own unique characteristics that investors need to be aware of.
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While we can't guarantee there will be a market for it, we'll help you sell the CD at the current market rate by requesting bids on your CD and contacting you with the highest one. If you decide to sell, you'll receive the bid price plus any accrued interest. There are no guarantees that you'll get what you originally paid for the CD.
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All CDs in CD OneSource are offered by FDIC-insured banks. The Federal Deposit Insurance Corporation insures deposits at FDIC-insured banks. The basic insurance amount is $250,0001 per depositor per insured bank. Each CD you purchase from a different institution is FDIC-insured in aggregate based on ownership type at that bank. For example, if you own two CDs, $250,000 from one bank and $250,000 from a second bank, and you have no other deposits at those banks, you’re covered for $500,000. Certain conditions must be satisfied for FDIC insurance coverage to apply.
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Schwab offers brokered CDs which could be resold through brokerage firms at the market price. If the client wants to redeem before the maturity, the price may differ from the original purchase price of CD, which may result in a gain or loss. Banks offer traditional CDs and often have you forfeit the interest payment to redeem CD early. Bank CDs cannot be held in a brokerage account and must be held in an account with that specific bank.
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