Capital One 360 certificates of deposit offer a safe way to grow your savings with some competitive interest rates that range from 4.00% to 5.10% APY (annual percentage yield), depending on the CD term you choose. All of its CD terms — six months to five years — have a good feature for novel savers: no minimum balance requirements.
Annual percentage yields (APYs) and account details are accurate as of March 20, 2024.
Overview of Capital One 360 CDs
While many certificates of deposit (CDs) have a minimum deposit amount, Capital One’s offerings don’t. This gives you the flexibility to start saving immediately, even if you don’t have a lot in the bank. Perhaps the positive feedback you receive from a decent yield will spur you on to save more later.
Additional flexibility comes from the variety of CD terms ranging from six to 60 months. However, there is a limit on how large your CD can be — $1,000,000.
| OVERVIEW | |
|---|---|
Minimum deposit | $0 |
Term lengths | 6, 9, 10, 12, 18, 24, 30, 36, 48 and 60 months |
Compounding schedule | Monthly |
Early withdrawal penalty | CDs with terms of 12 months or less: penalty of three months’ interest; CDs with terms greater than 12 months: penalty of six months’ interest |
Grace period for penalty-free withdrawals after maturity | 10 days |
How much can you earn with a Capital One 360 CD?
The CD market is in flux thanks to the Federal Reserve raising interest rates to quash inflation, meaning you can find much higher APY now than you could have during most of the post-Great Recession era.
In its March 2023 meeting, the Fed signaled that further rate increases are likely to happen this year, albeit at a slower pace than Americans experienced in 2022.
Whatever the APY though, the more you deposit into a CD and the longer you leave your money in it, the more you’ll earn. A long-term CD is a great way to make more from your money.
To illustrate, here are your potential earnings from Capital One 360 CDs for various CD terms if you made a $10,000 deposit.
| CD TERM | APY | EARNINGS |
|---|---|---|
6 Months | 4.35% | $220 |
9 Months | 4.35% | $325 |
10 Months | 5.10% | $423 |
12 Months | 4.90% | $500 |
18 Months | 4.50% | $713 |
24 Months | 4.20% | $878 |
30 Months | 4.10% | $1,057 |
36 Months | 4.10% | $1,282 |
48 Months | 4.05% | $1,721 |
60 Months | 4.00% | $2,165 |
How Capital One 360 CDs compare
Compared to the national average data from the Federal Deposit Insurance Corporation (FDIC), the yields on Capital One 360 CDs are rich. And they’re frequently on par with what its big-bank peers offer. See:
- Citibank CD rates.
- Bank of America CD rates.
- Chase CD rates.
However, a note before you celebrate, other online banks are often more competitive. The Synchrony Bank certificates of deposit, which also has no required minimum deposit amount, has better long-term CD rates and the First Internet Bank certificates of deposit, which have a $1,000 minimum, currently offers better APYs across the board.
| CD TERM | NATIONAL DEPOSIT RATES (AS OF MARCH 18, 2024) | CAPITAL ONE 360 CD RATES | SYNCHRONY BANK CD RATES | FIRST INTERNET BANK CD RATES |
|---|---|---|---|---|
6 month | 1.52% APY | 4.35% APY | 4.80% APY | 5.18% APY |
12 month | 1.81% APY | 4.90% APY | 4.90% APY | 5.31% APY |
24 month | 1.53% APY | 4.20% APY | 4.20% APY | 4.82% APY |
36 month | 1.38% APY | 4.10% APY | 4.15% APY | 4.66% APY |
48 month | 1.29% APY | 4.05% APY | 4.00% APY | 4.50% APY |
60 month | 1.38% APY | 4.00% APY | 4.00% APY | 4.55% APY |
In the market for a CD? Check out: The best CD rates.
As you compare CD terms and not just CD providers, you’ll notice that some rates peak at 12 months. That doesn’t mean you should discount longer-term CDs. Rates for multi-year CDs are still relatively elevated and you’ll earn more money on them over their longer terms.
For example, imagine you deposit $10,000 into two CDs. Both compound monthly. A one-year CD with a 5.25% APY would garner $525 while you’d earn almost double that ($899) with a two-year CD with an APY rate of 4.40%.
How to open a Capital One 360 CD account
- Login or create your Capital One account. New customers will need to fill in some information by hand, including name and address. If you’re a current Capital One customer, you can login and have part of the CD application filled in for you. This applies to anyone who has a Capital One checking or savings account, credit card, active home loan or active car loan.
- Choose your term. Capital One offers CDs with terms ranging from six to 60 months. As you look, consider whether the term you want is right for your overall financial plan. While you can make early withdrawals, you’ll pay an early withdrawal penalty that’ll cost you three-to-six months worth of interest.
- Decide on interest payouts. When would you like to receive the interest that your deposit earns? You could choose to get it each month, each year or once at the end of the CD term.
- Link another account. Because Capital One 360 is the online arm of the bank, you can’t go to a branch and make a cash deposit to fund your CD. Rather, you must do an electronic transfer and the first step is to link another account. The other account can either be in-house (a Capital One checking account, for example) or external (at another institution).
- Fund the account. To finish opening the CD, put money in it. You can only add money to a Capital One 360 CD one time. (Later, if you have more cash you’d like to invest, you can open another CD). There’s no minimum balance, so you could open one with whatever funds you have.
Documents you’ll need
In all likelihood, you won’t need to submit documents, but you will need to provide some information. For current Capital One customers, all the information you need is your password and login.
If you don’t already have a Capital One account, you’ll have to create one, which is normally a simple process. You’ll have to provide personal details including your name, date of birth, email, residential address and government identification number, such as your Social Security Number (SSN) or Taxpayer Identification Number (TIN).
About Capital One Bank
Perhaps best known for its funny credit card ads, Capital One is a full-service, national bank with over $390 billion in total assets, making it the tenth largest bank in the nation. It has a robust variety of financial products, from checking and saving accounts to credit cards and auto loans. It was founded in 1994.
Alternatives to Capital One CDs
Want another savings product, or lower-risk investment, besides your CD? Consider these alternatives.
High-yield savings
The best high-yield savings accounts currently have interest rates that are competitive with CDs, offering high APYs while still allowing you to make withdrawals and additional deposits at least six times a month.
You can find plenty with no fees and no minimum balance requirement, like the Capital One 360 Performance Savings. And your deposits are still protected under the Federal Deposit Insurance Corporation (FDIC) with $250,000 guaranteed per person per institution.
Bonds
A sister to CDs, bonds are extremely low-risk investments; federal government bonds being seen as the most secure. Like with CDs, you lock your money away for at least a minimum amount of time and earn interest on your deposit. Government bonds include Treasury inflation-protected securities (TIPS), I Bonds, EE Bonds, treasury bills (T-Bills), treasury notes and municipal bonds. Companies big and small also offer corporate bonds.
Money market fund
A money market fund is a short-term mutual fund that doesn’t require you to lock away your cash and could provide some tax benefits. Before you sign up though, be sure to consider the cons, which include the facts that your interest rate isn’t guaranteed (it will change with the market) and you may have to pay fees when cashing out.
Dividend-paying stocks
With the best dividend stocks, you can make money not just from buying and selling, but from simply owning them. Many companies will pay investors a yearly dividend, a certain amount per stock owned.
Peer-to-peer lending
As an investor, you can round up your money and lend it to borrowers through a peer-to-peer loan. You could earn a great interest rate on your cash, but it’s not without risk as most of the debt funded this way is not secured, much like a personal loan.
Frequently asked questions (FAQs)
CDs are extremely low risk when your total funds are within the federally insured limits, which are $250,000 per person, per insured financial institution, for each account ownership category. The FDIC guarantees protection for bank deposits and the credit union deposits are covered by the National Credit Union Share Insurance Fund.
“Funds in excess of those limits are not guaranteed to be safe,” said Andrew Griffith, CPA and associate professor of accounting at Iona University.
Yet if you have a hunk of cash that you want to keep in one place, he recommends a credit union.
“NCUA-insured institutions tend to be safer institutions for a depositor who exceeds the federally insured deposit limits,” Griffith said.
While many CDs require a minimum of $500 or more for their CDs, Capital One CDs don’t have a required minimum deposit. You can open one with whatever balance works for you.
There are no fees or costs associated with opening a Capital One CD and it can be done online in around five minutes. As an industry norm, there is typically no cost to open a CD. Financial institutions use your CD deposits to fund other aspects of their business. A CD is essentially a loan to a company and your cut of the profits is paid to you in the form of APY. Charging you fees to open a CD would be counterproductive for the provider in most scenarios.
Like most CDs, Capital One CDs automatically renew unless you withdraw your cash. The renewed CD will be for the same time period and the interest rate on it will be whatever rate was offered by Capital One on the date it renewed.
Yes, Capital One CDs have an early withdrawal penalty that’ll cost you three months of interest if the CD is one-year long or shorter; six months of interest if the CD has a term greater than 12 months.
Capital One 360 is the online division of Capital One. Online banks typically pay out a higher interest rate on deposits in exchange for a lack of brick-and-mortar branches.
