Citizens Bank is part of one of the largest financial institutions in the country. It has more than 1,100 branches across 11 Northeastern states, so there’s a decent chance you live near one if you're in that part of the country. People interested in a certificate of deposit (CD) account should visit or call a local branch to find the latest available term options. In general, you will find that the interest rates do not compare well with the best CD rates on the market. The minimum deposit of $1,000, which is comparable to other large banks, certainly isn’t the lowest around.
Don’t write off Citizens Bank yet, though. It offers some flexibility with CDs. You can make early withdrawals without paying a penalty. It also offers CDs that you can use in a retirement account, starting at a minimum deposit of just $250. Continue reading for more on whether or not you should think about opening a CD account with Citizens Bank.
|CD Term||Minimum Deposit||APY: Standard Rate|
|14 Month Online-Only||$1,000||0.05%|
|10 Month||$1,000|| |
|25 Month||$1,000|| |
Overview of Citizens Bank CDs
Citizens Bank, headquartered in Rhode Island, is part of one of the largest financial institutions in the country. According to the bank’s website, its customers have access to more than 1,100 branches and 3,100 ATMs across 11 states.
However, you may not have as many choices if you’re looking to open a CD with Citizens Bank. The bank currently offers only a few competitive term options, ranging from one to four years in length. It is important to note that local branches may have additional offerings that are anywhere between one and 120 months long.
Standard CDs come with a $1,000 minimum deposit and two potential interest rates. Customers who have either a Platinum or Platinum Plus Checking account qualify for a higher rate. That relationship rate is typically higher than the standard rate. Interest in CD accounts compounds and pays monthly. At that point, you can withdraw or transfer the earned interest into another account. If you want to receive interest disbursements each month in the form of a physical check, your CD will need to have an initial deposit of at least $5,000.
If you want a CD for use in an individual retirement account (IRA), you should talk to a local branch about term options. IRA CDs have a minimum of just $250 and are potentially available in term lengths ranging from one month to 10 years.
The highest interest rates from Citizens Bank come with its online CDs. You can open and manage these CDs entirely through the bank’s online banking platform. This provides freedom if you don’t live near a branch.
Customers who aren’t comfortable with the idea of tying up their money for the full term of a CD may like the Breakable CD option. This CD allows you to make one withdrawal during your term without paying a penalty. If you choose, you can even withdraw all of your principal. Breakable CDs require a minimum deposit of $10,000.
Outside of the Breakable CD, you cannot withdraw any of your CD principal before the end of your CD term. If you do, you will pay an early withdrawal penalty. The penalty amount depends on the length of your CD term, how much you withdraw and your interest rate. CDs less than one year long have a penalty of 90 days’ interest on the amount you withdraw or half of the remaining interest that your CD would earn, whichever is greater. CDs with a term of one year or longer have a penalty of 180 days’ interest on the amount you withdraw or half the remaining interest that your CD would earn, whichever is greater. In addition to the penalty, you will pay a $50 transaction penalty.
In order to withdraw funds without a penalty, you will need to wait until the end of your term. Citizens Bank will give you a 10-day grace period after your CD reaches maturity. You can make any changes, withdrawals or additions to your account during that time. Your CD will automatically renew at the end of the grace period unless you withdraw your funds or notify the bank that you wish to close your account.
How Much You Earn With Citizens Bank CDs Over Time
Citizens Bank’s CDs have relatively low interest rates. You can get higher rates if you have a checking account with Citizens Bank, but rates still aren’t very high. That means you won’t earn much in interest unless you make a significant opening deposit. Because Citizens Bank doesn’t have many special long-term CD options, choosing a longer term won’t necessarily earn you significantly more interest.
The table below shows what your approximate total balance will be based on different initial deposits and term lengths. This table uses the relationship rates listed above.
|Initial Deposit||10-Month CD||14-Month CD||25-Month CD|
Compare Citizens Bank to Other Competitive Offers
How Citizens Bank CD Rates Compare to Other Banks
When you compare CD rates from different banks, you will see that the interest rates from Citizens Bank are quite low. Because of that, you should definitely explore accounts with other banks.
If you are looking for a bank with physical locations, consider Capital One. It offers competitive rates with no minimum deposit.
Customers who like the rates for Citizens Bank’s online CD should look into some other online banks as well. Ally Bank, one of the largest online banks, offers high rates. Its short-term CDs stack up well with some of the best deals on the market. Ally has no minimum for its CDs.
People who are drawn to Citizens Bank’s IRA options should also consider a broker like Edward Jones. Brokered CDs work slightly differently from accounts with more traditional banks, but they offer some of the highest rates on long-term CDs. Edward Jones requires a minimum deposit of $1,000 but this may be worth it for you because of the good rates.
|CD Account||Citizens Bank||Ally Bank||Capital One|
|2 Year (*25 month)||0.10%*||0.55%||0.25%|
Should You Get a Citizens Bank CD Account?
You should consider a CD account with Citizens Bank if you are already a customer and don’t want to open an account at any new institution. It may also be worth it for you if you live near a local branch. Otherwise, you should consider other banks. Other banks will have higher rates whether you are looking for short- or long-term options. Some people may like the Breakable CD from Citizens Bank, but you can get a short-term CD somewhere else (so that you can have your money back soon if you think you will need it) and still earn more in interest.