Bread Financial operates as an online bank offering credit cards, loans, savings, and business accounts. Bread Savings stands out with its high-yield savings and CD accounts, offering interest rates that surpass those found at conventional banks with physical branches.

Bread Savings provides FDIC-insured accounts that can be effortlessly opened and managed online. Here are the critical aspects to consider when evaluating whether Bread Savings and its CDs suit your financial goals.

Overview of Bread Savings

Bread Savings is a segment of Bread Financial, which also owns Comenity Bank and Comenity Capital Bank, among other entities. Because of this affiliation, Bread Savings ensures full FDIC insurance up to $250,000 for individual accounts and $500,000 for joint accounts.

Although Bread Financial may not be as well-known as some other financial institutions, it is a reputable bank with government-backed insurance, making it a reliable place for your deposits.

Bread Savings does not levy regular maintenance fees on any of its savings accounts. There are no minimum balance or activity stipulations to prevent a monthly fee. Most users will find their accounts completely fee-free when used as intended.

Bread Savings High Yield Savings Account

The high-yield savings account from Bread Savings offers an interest rate significantly higher—by more than 200 times—than those provided by some of the major, traditional banks.

As of now, the interest rate stands at 4.00% APY, though this rate is subject to change without prior notice. Interest rates often fluctuate following announcements by the Federal Reserve about changes in its target rate or due to the bank’s changing financial circumstances. For the most current rate, visit the Bread Savings High-Yield Savings Account webpage, where you can also open a new account.

A minimum opening deposit of $100 is required for this account. For those with substantial funds, the account allows deposits up to $1 million per account and $10 million per customer, greatly exceeding FDIC insurance limits if that is a concern for you.

There are no monthly maintenance fees or minimum balance requirements for this account. It features free electronic funds transfers to and from other U.S. banks. Incoming wire transfers incur no fees, and you can also deposit checks via the Bread Financial app.

Common fees are generally limited to less frequent activities like outgoing wire transfers, official checks, and paper statements.

While the minimum deposit and maximum balance limits may deter some users, the high interest rate and minimal fees make this account an obvious choice for long-term savings like an emergency fund, down payment savings, or a vacation fund.

Bread Savings CDs

A Certificate of Deposit (CD) is a fixed-term savings account that offers a higher interest rate in exchange for keeping your money deposited for a set period. Bread Savings CDs provide terms ranging from one to five years, featuring interest rates significantly above the national average.

Below is a summary of the current rates. Note that these rates are subject to change at any time without prior notice. Visit the Bread Savings CD page for the latest rates and to sign up.

1. Term Length: 12 months, APY: 4.50%

2. Term Length: 24 months, APY: 4.50%

3. Term Length: 36 months, APY: 4.50%

4. Term Length: 48 months, APY: 4.50%

5. Term Length: 60 months, APY: 4.50%

To open a CD account, a minimum deposit of $1,500 is required. The account limit is $1 million per account and $10 million per customer.

CDs are ideal for individuals who do not need to access their funds for the entire term. Early withdrawals incur penalties. For CDs of one to three years, the penalty is 180 days of interest. For terms of four years or longer, the penalty is 365 days of interest. If you cannot commit to the full term, consider a high-yield savings account instead due to these significant penalties.

CDs offer a higher interest rate but come with risks. The interest rate is fixed for the term’s duration. If market rates increase, you remain with the initial lower rate. If you anticipate rising interest rates, you might delay opening a CD to benefit from higher future rates.

A CD is advantageous when you expect stable or declining rates, as the fixed rate allows you to earn more even if market rates drop. At maturity, you can either renew at the new rate or withdraw your funds without penalties during a 10-day grace period.