Quontic Bank CD rates: now over 5% on a 1-year CD

Quontic Bank CD rates are at 5.30% APY on a 1-year CD

Founded in 2009, Quontic Bank currently operates as a digital bank with no branch locations. It offers a variety of different CDs and savings accounts—all of which are FDIC-insured—plus loan options for life’s bigger purchases. It’s also considered a Community Development Financial Institution (CDFI), which means it provides financial services to low-income communities.

Quontic currently has some of the CD rates available, especially on their 1-year certificates. And no, you’re not dreaming—their rate is a whopping 5.3% APY. For comparison, that’s nearly three times the national rate (1.72%) on a 12-month CD, according to figures from the FDIC.

Key figures 

• Minimum deposit: $500
• Term length: 1-year CD
• APY: 5.3%
• Compounding frequency: Interest is compounded daily and credited to your account monthly
• Early withdrawal penalty: 1 year’s worth of interest 

To put your savings to work in a Quontic CD, you’ll need to open an account with the bank and deposit at least $500, which you can do online. When you’re ready to invest, just have your address, phone number, SSN, and email address on hand to speed through the application. Then, you can fund your CD by transferring funds to Quontic from your regular bank account. 

One word of caution: To get this amazing rate, there’s a substantial early withdrawal penalty that will cost you an entire year’s interest. So, make sure you’re only investing cash you won’t need in the next year.

For instance, say you take advantage of this 1-year Quontic Bank CD and invest $10,000. At  a 5.3% APY, you’ll earn $530 in interest after a year. But if you withdraw money from your CD six months into the 1-year term, you’ll have to pay back roughly $530 in total—the interest you’ve already accrued (roughly $260) plus almost $270 for the penalty. This CD is a hot deal, but the penalty could burn.

How do I know if a Quontic 1-year CD is right for me?

This Quontic 1-year CD definitely has its perks—an APY above 5% plus FDIC insurance, which is important in a year where the banking industry has had a rough time.

When you invest in a traditional CD, you get the security of a fixed rate for a fixed time, which can benefit a wide variety of savings goals. For example, if you’re saving for a housing down payment, you could put your money in a 1-year CD and earn some extra money to put toward closing costs.

However, a CD might not be the best choice for you if you need your savings to be easily accessible. In this case, a high-yield savings account may be a better option since you can earn a higher APY than you would with a traditional savings account. You also won’t be penalized for needed emergency access to your cash. 

The takeaway 

As inflation slowly declines and interest rates rise, it’s a great time to be a saver. So if you’re trying to decide whether to put your money in a CD now or wait, Quontic’s 1-year CD makes a solid argument for “now.”