Overview

1. Synchrony Bank Certificates of Deposit Details

• Our Rating: 5/5 stars

• Initial Deposit Required: $0

• 1-Year APY: 4.80%, 3-Year APY: 4.15%, 6-Month APY: 5.15%

Analysis: Synchrony Bank presents a suite of flexible CD options, catering to various investment timelines. Ranging from three months to five years, including innovative choices like the Bump-Up CD and No-Penalty CD, Synchrony aligns with diverse financial objectives. Remarkably, none of their CDs mandate a minimum opening balance, a rarity in the industry. Compared to both traditional and online banks, Synchrony consistently offers higher rates, making it a top choice for CD investments.

2. Attractive Yields Without Minimum Balance Constraints

Synchrony’s CDs boast above-average APYs, accompanied by a broad spectrum of term lengths. This ensures suitability for a wide range of investors, irrespective of their financial targets. Notably, Synchrony extends a no-penalty CD option, allowing early withdrawals sans fees, though its rate remains modest. Moreover, the Bump-Up CD feature empowers investors with a one-time opportunity to elevate their APY, should rates ascend prior to maturity.

Benefits:

Competitive interest rates across various terms

• Absence of minimum deposit requirement

• Beneficial Bump-Up CD feature

Drawbacks:

• Limited to terms up to 60 months

• No-penalty CD offers a relatively low rate

Synchrony CD Rates

3-month CD terms: 0.25% APY, 6-month CD terms: 5.15% APY, 9-month CD terms: 4.90% APY, 11-month No-Penalty CD terms: 0.25% APY, 12-month CD terms: 4.80% APY, 13-month CD terms: 4.50% APY, 14-month CD terms: 5.00% APY, 15-month CD terms: 4.50% APY, 16-month CD terms: 4.00% APY, 18-month CD terms: 4.50% APY, 19-month CD terms: 4.00% APY, 24-month CD terms: 4.20% APY, 24-month Bump-Up CD terms: 3.50% APY, 36-month CD terms: 4.15% APY, 48-month CD terms: 4.00% APY, 60-month CD terms: 4.00% APY (Note: APYs are accurate at the time of writing and are subject to change before opening and funding a CD account.)

How Synchrony CD Rates Compare

Synchrony CD rates typically exceed those of major banks like Chase and Wells Fargo, although some rates have declined since the previous year. Among online banks, Synchrony's rates rank among the most competitive. It frequently outperforms competitors such as Marcus by Goldman Sachs, Discover Bank, and Capital One. However, superior rates may be available from select online-only banks, such as Bread Financial (formerly Comenity Bank).

It's important to note that APYs are subject to fluctuation. While pursuing the highest interest rate can be tempting, CDs require time to mature. In many instances, prioritizing reputable and well-established banks that align with your financial requirements may be more advantageous.

Synchrony CD Overview

• Minimum Deposit: Not required

• Interest: Compounded daily and credited monthly

• CD Term Options: 16 options ranging from 3 months to 5 years

• Monthly Fees: None

Synchrony Bank stands out with its competitive rates and a diverse array of CD term options, ranging from 3 months to 5 years, all without requiring a minimum opening deposit—a rarity among banks.

CDs automatically renew, allowing a 10-day window for adjustments such as fund additions or withdrawals, transfers to different CDs, changes in term lengths, or account closure.

1. Early Withdrawal

Similar to many other banks, Synchrony applies an early withdrawal fee if you access your funds before maturity. The penalty amount depends on your term length and account balance at the time of withdrawal, ranging from 90 days to 12 months of simple interest.

2. No-Penalty CDs

For those needing flexibility, Synchrony offers a no-penalty CD. Unlike traditional CDs, this option allows closure without incurring early withdrawal fees before the 11-month term concludes. However, note that its interest rate significantly dropped in March 2024, and Synchrony's high-yield savings account might offer a better rate for accessible reserves.

3. Bump-Up CDs

In uncertain rate environments, Synchrony presents the Bump-Up CD. This unique account permits a one-time rate increase during its 24-month term if rates rise. Conversely, if rates remain stable, the initial APY remains unchanged. While this option carries a lower interest rate compared to Synchrony’s standard 24-month CD, it provides cautious investors with flexibility.

Is Investing in Synchrony Bank CDs a Wise Choice?

Certificates of Deposit (CDs) from Synchrony Bank may be a viable option if the following conditions apply:

• You seek a low-risk avenue to grow your savings gradually.

• Committing your funds for a predetermined period doesn't inconvenience you.

• Synchrony Bank's CD rates, coupled with their benefits (like no minimum deposit requirement), align with your financial objectives.

Wrapping Up

Synchrony Bank offers some of the most competitive CD rates in the market, and its unique features, such as the “bump-up” and “no-penalty” CDs, provide risk-averse investors with ample flexibility. However, their rates may not be as attractive as they once were. Additionally, Synchrony Bank is an established online banking institution with a proven track record of delivering innovative financial solutions to its clientele.

Nonetheless, it is always prudent to compare CD offerings from multiple providers before deciding on the account that best suits your needs. You can kickstart your research by exploring our curated list of the top CD rates currently available.

Synchrony CD FAQs

Q1: Can I open a Synchrony Bank account regardless of my state of residence?

A1: Synchrony Bank operates entirely online, without any physical branch locations. As a result, you can apply for and maintain an account with Synchrony Bank regardless of the state in which you reside. The basic eligibility criteria to open an account include being a United States citizen or legal resident, possessing a valid U.S. residential address (military addresses are also acceptable), and having a Social Security Number or Tax Identification Number.

Q2: What is the purpose of a CD ladder, and how does it function?

A2: A CD ladder is a strategy that allows you to strike a balance between locking in higher interest rates and maintaining ongoing access to a portion of your funds. Instead of placing your entire savings into a single Certificate of Deposit (CD), you distribute your funds across multiple CDs with varying maturity dates. As each CD reaches its maturity date, you have the option to either withdraw the funds for your immediate use or reinvest them into a new CD. Over time, this approach ensures that you have a CD maturing at regular intervals, such as every six months or every year, providing you with periodic access to your money.

Q3: Are Certificates of Deposit offered by Synchrony Bank insured by the Federal Deposit Insurance Corporation (FDIC)?

A3: Yes, Synchrony Bank's Certificates of Deposit are insured by the FDIC up to the standard coverage limit of $250,000 per depositor, per ownership category. This level of insurance protection is consistent with the coverage offered by most banks that are members of the FDIC.