More About CDs and Jumbo CD Accounts
What Is a Jumbo Certificate of Deposit Account?
A jumbo CD (certificate of deposit) is a specialized type of fixed-term account that requires a much larger initial investment, typically of $100,000 or more. The term “jumbo” does not refer to the interest rate or term length, but rather to the higher minimum amount of money that is required to open and maintain these accounts.
Just because you have a large amount to invest doesn’t necessarily mean you need to find a product called “jumbo CD,” however. At Raisin, we don’t differentiate between CDs based on balance size. All of the CDs available in our platform have just a $1 minimum deposit to open, allowing savvy savers to access competitive rates without the need for reaching jumbo CD account minimums.
For institutions that have this differentiation, jumbo CDs may offer higher interest rates than smaller CDs and traditional savings accounts. They are usually offered by banks, credit unions, and other financial institutions and are seen as less risky due to the larger initial investment. The interest rate for a jumbo CD is typically fixed for the term of the CD, which can range anywhere from three months to five years.
Jumbo CDs or fixed-term CDs with a larger initial investment may be a good option for people with a large amount of cash that they do not need immediate access to, as they offer the possibility to earn higher interest rates on their savings. They are also considered to be low-risk investments as long as the bank or credit union offering them is insured by the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA).
In order to make an informed decision to secure the best jumbo CD rates, it’s important to consider the term length (or how long it will take the CD to mature), the institution offering the CD, and the liquidity of the account.
Jumbo CD Account Rates
One of the primary advantages of jumbo CDs is the higher interest rates they offer compared to regular CDs and traditional savings accounts. Generally, the longer the term, the higher the interest rate will be. For example, a five-year jumbo CD rate will typically be higher than a six-month or three-month jumbo CD rate.
These short-term investments are a good option for investors who want to earn a higher interest rate on their savings without committing to a long-term investment. However, it is important to keep in mind that short-term jumbo CDs may not offer as high of an interest rate as longer-term options. Financial institutions are willing to pay a premium in interest for the opportunity to hold onto your funds for longer, uninterrupted periods of time.
Typically, the more money you deposit into a jumbo CD, the higher the interest rate you can earn. For example, a bank may offer a 1.5% interest rate on a jumbo CD balance of $100,000 or more, but only a 1% interest rate on a jumbo CD with a balance below $100,000.
On the Raisin platform, our rates are competitive no matter your initial deposit amount, allowing you to earn at the same APY whether you put in $1 or $100,000.
How Does a Jumbo CD Account Work?
At institutions that differentiate between CDs based on deposit size, a one-time, lump-sum deposit of at least $100,000 or more is typically required, depending on the financial institution.
Just like with a non-jumbo fixed-term CD and like all CDs offered through Raisin, once you’ve made your deposit, the bank or credit union will agree to pay you a fixed interest rate for a set period of time. During this time, your deposit is effectively locked in, meaning you won’t be able to withdraw any funds without paying an early withdrawal penalty.
At the end of the term, you’ll receive your original deposit plus any interest earned, which is typically paid out in a lump sum. You can then choose to either roll your funds over or withdraw your funds without penalty.
At Raisin, customers can visit their account dashboard and easily change their CD rollover preferences up until a CD is set to mature.
Can I Withdraw Money from a Jumbo CD Account?
While you may be able to withdraw money from a jumbo CD account before the maturity date, this will typically come with an early withdrawal penalty. The specific penalty amount and terms will vary depending on the institution.
If you have a CD through Raisin, you can consult the product information sheet for the CD or reach out to Raisin's customer service to help you determine the penalties for withdrawing early.
What Can a Jumbo CD Account Be Used For?
A jumbo CD account may be used for a variety of purposes, including but not limited to:
Investment: A jumbo CD can be an attractive investment option for people looking for a low-risk way to earn a fixed rate of return on their cash.
Savings: A jumbo CD can be used as a way to save a large sum of money that you don’t need immediate access to.
Diversification: A jumbo CD can be a great way to diversify your investment portfolio by adding a low-risk asset with a fixed return.
Estate planning: A jumbo CD can be used as part of an estate plan to pass on wealth to heirs and/or beneficiaries.
Short-term funding: A jumbo CD may also be used by a small business as a way to secure short-term funding for a project, or even to help cover payroll expenses.
Different Types of Jumbo CDs
Before making a decision on which jumbo CD to go with, it's important to research and compare the terms and conditions to find one that fits your financial goals and needs. There are many different types of jumbo CDs available, including:
Traditional jumbo CDs are the most common type of jumbo CD, which typically require a minimum deposit of $100,000 or more and offers a fixed interest rate for a specific term, which can range from several months to several years.
Callable jumbo CDs allow the issuing bank or credit union to “call” or redeem the CD before the maturity date, usually after a specified period of time has passed. Callable CDs may offer higher interest rates than traditional CDs, but they also come with additional risk.
Step-up jumbo CDs offer a rising interest rate over the course of the term. The interest rate on a step-up CD may increase at predetermined intervals, such as every six months or every year.
Bump-up jumbo CD allow the investor to request a higher interest rate if rates go up during the term of the CD. Typically, only one rate increase is allowed during the term.
Brokered jumbo CDs are sold through a brokerage firm instead of directly from a bank or credit union. Brokered CDs may offer higher interest rates than traditional CDs, but they may also come with additional fees or commissions.
Find and Open CD Accounts Through Raisin
Ready to start investing? With Raisin's innovative online platform, you can easily explore a wide range of federally insured CDs, featuring highly competitive rates and customizable options. Because we don’t differentiate rates based on balance size, you can access competitive rates starting with a deposit as low as $1. Simply complete a one-time registration and you’ll be able to open and manage CD accounts from multiple insured banks and credit unions all through one login.
How to Choose a CD Account
APY.
Annual percentage yield (APY) is one of the most important figures associated with a CD account or certificate because it dictates how much you’ll earn on your money. The higher the rate, the more you’ll make over time. A CD’s rate is fixed over its term length; it won’t vary up or down. This means your rate (and, by extension, your return) is insulated against the changes in market conditions that might impact a variable-rate product like a money market account. Bear in mind that APY is annualized, meaning that it tells you the expected performance over a year-long period. (A 3-month CD with a 1% APY is not going to return 1% interest in 3 months.) But APY helps with comparing CDs of different term lengths because it normalizes the rates for comparison.
Security.
CDs and certificates are types of deposit accounts, which means they are eligible for FDIC or NCUA insurance through financial institutions. FDIC insurance (covering banks) and NCUA insurance (covering credit unions) offers government-backed protection on your money, up to $250,000 per depositor, per insured institution. Ensure your funds will be covered by choosing a federally insured account. Visit fdic.gov and ncua.gov for more information.
Minimum deposit.
Different CDs have different rules for the minimum amount required to open an account — varying from as little as $1 to as high as several thousand dollars. The CD accounts and certificates available through Raisin can be opened with as little as $1.
Fees (or lack thereof).
Some financial institutions might charge monthly maintenance fees, which can quickly eat into your savings. Make sure you understand any fees that are associated with an account — or choose one that doesn’t charge any. There are no fees to open or maintain a CD account or certificate through Raisin.
Withdrawal penalties.
CDs are not considered liquid, which means you cannot withdraw or transfer funds out of a CD freely. There may be penalties associated with early withdrawal. But the specific terms — how the penalty is determined — may vary by institution. Consult the product terms for a CD you’re considering to learn how withdrawal penalties are handled. Options like no penalty CDs (see above) may allow you to avoid the risk of incurring withdrawal penalties.
What Is Raisin?
Raisin brings together high-yielding savings products offered by a network of U.S. financial institutions. It’s your destination to discover competitive savings products and start saving wisely. Select and fund multiple savings products from different institutions and manage them all from one account.
Safety
Funds deposited into any of the savings products available through Raisin are always held by a federally insured financial institution. A very easy and safe way to diversify your deposit portfolio. We use a host of cybersecurity measures to protect your funds and sensitive information.
Choice
Savings products from our network of financial institutions offer flexible terms and some of the most competitive interest rates. You can easily find the right product or mix of products for you.
Convenience
One account to hold all your deposit products. Simplified statements. Easy access to manage your funds – all through a streamlined digital platform.
How Raisin Protects Your Money and Personal Information
Federal Deposit Insurance Corporation
All participating banks are members of the FDIC. Deposits in participating banks are insured by the FDIC up to the limits of federal law. The standard insurance amount is $250,000 per depositor, per insured bank, for each deposit account ownership category.
Click to learn more about FDIC insuranceNational Credit Union Administration
All participating credit unions are insured by the NCUA through its Share Insurance Fund. Deposits in participating credit unions are insured by the NCUA up to the limits of federal law. The standard insurance amount is $250,000 per depositor, per insured credit union, for each deposit account ownership category.
Click to learn more about NCUA insuranceCybersecurity is a top priority at Raisin
We invest in a variety of technologies to protect our customer’s data, privacy and transactions. These include multi-factor authentication, encryption, and web application firewall advanced internet protection technologies. We are a SOC 2 certified organization, which means we have met the requirements outlined by the American Institute of Certified Public Accountants (AICPA) to ensure that we have the controls in place to keep customers' data secure and private.
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FAQs
Raisin is a digital platform that gives savers unparalleled access to a variety of deposit products through the convenience of a single account, helping you unlock the growth potential of your cash savings.
Raisin customers use the platform to fund federally insured deposit products offered by numerous U.S. banks and credit unions with a wide range of maturities and APYs (annual percentage yield), allowing you to build a savings strategy to suit your earning and liquidity needs.
Raisin is not a bank. It provides the digital “storefront” where banks and credit unions can promote their deposit products.
Raisin is operated by Raisin LLC, a 100% subsidiary of Raisin GmbH, a trailblazer for open banking in the deposits and investments space. In the U.S., Raisin helps banks and credit unions improve their deposit funding by offering national reach for their retail deposit products, and provides savers with better access, more choice and higher convenience when evaluating savings products from FDIC insured banks and NCUA insured credit unions.
Your Raisin account gives you access to savings accounts and certificates of deposit offered by a variety of banks and credit unions with the security of federal deposit insurance. These products include:
High-yield Savings Account (HYSA). As its name indicates, this account type functions like a traditional savings account — with typically no restrictions on depositing and withdrawing funds — but earns interest (or dividends in the case of credit union savings products) at rates that are higher than the national average for standard savings accounts.
Money Market Deposit Account (MMDA). Also known as a money market account or MMA, this type of savings account offers a varying rate that allows you to earn interest (or dividends) on your funds with maximum flexibility for withdrawals. Like a HYSA, an MMDA offers features of a traditional savings account with typically higher returns.
No Penalty CD. Through the flexibility of a No Penalty CD, you can lock in a competitive rate for a fixed term with the option to make a full withdrawal without having to pay a penalty for the early termination. Terms and conditions may vary by product. Please see specific product terms for more details.
Fixed Term CD. With this longstanding savings vehicle, funds are held for a fixed term, and a competitive APY (annual percentage yield) provides safe, predictable earnings. In contrast to No Penalty CDs, typically you are charged a fee if you do not complete the full term of the Fixed Term CD.
Interest (or dividend in the case of credit union savings products) is compounded daily and posted to your account monthly.
The short answer is yes! Raisin exclusively partners with FDIC-insured banks and NCUA-insured credit unions.
For Raisin customers who hold savings products offered by one of our partner banks, funds are insured by the FDIC up to the maximum amount in accordance with and as permitted by law at each bank holding their funds. The standard deposit insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per account ownership category. Ownership categories as defined by the FDIC include single bank accounts (owned by one person/depositor) and joint bank accounts (owned by two or more persons/depositors). Revocable trust accounts and some types of retirement accounts (e.g., IRAs) are among the other ownership categories covered by FDIC insurance. All deposits you have at a bank — whether made through Raisin or otherwise — count toward the deposit insurance limit. If funds held at a bank in a certain ownership category exceed the coverage limit, then the amount in excess of the limit will not be insured.
For Raisin customers who hold a savings product offered by one of our partner credit unions, funds are insured by the NCUA through its Share Insurance Fund. According to the NCUA, each credit union member has at least $250,000 in total coverage. The Share Insurance Fund insures individual accounts up to $250,000. Additionally, a member’s interest in all joint accounts combined is insured up to $250,000.
At Raisin, cybersecurity is our priority. Raisin is a SOC 2 certified platform, meaning it has been validated by outside auditors across five (5) key information security principles. We also use a variety of measures to protect our customers' data, privacy and transactions, including:
• User authentication. The Raisin platform uses multi-factor authentication combined with leading authentication technology to validate our customers’ identities.
• Data encryption. Your personal information is encrypted in-transit and at rest using advanced cryptographic security algorithms.
• Site protection. Web application firewall advanced internet protection technologies are implemented to protect Raisin.com from malicious actors, botnets and denial of service attacks (DDOS).
• Monitoring. An always-on information security monitoring platform detects and alerts us to information security events.
• Assessments. Our platform undergoes vigorous security assessments and testing throughout the lifecycle of application development, from architecture planning to production phases.
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A. Check out our savings marketplace and choose a product in which you would like to deposit money.
B. Create your username and password.
C. Complete an application and, after successful identity verification, link a bank account from which to fund your first savings product.
D. Start earning interest as soon as your money is received by the bank or credit union offering the savings product you selected.
Any questions or concerns? Email us at support.us@raisin.com.
All deposits and withdrawals are completed within one to three (1-3) business days. After the initial deposit a withdrawals limitation for the first few business days may exist.
Business days are Monday through Friday excluding U.S. bank holidays.
For products offered by banks, all necessary registration is handled when you become a Raisin customer. One of the many benefits of our platform is that you can open a single account and earn competitive interest rates from banks in the Raisin network. When you select and fund a savings product offered by a credit union, there is an additional step of becoming a member. Raisin makes that process quick, easy and free. You still have one Raisin login and can view all your savings products in one convenient dashboard.
The current APY for your savings products can always be viewed on the Account Overview page when you are logged in to Raisin. This information also appears on monthly statements.
You cannot currently link your Raisin account to a third-party app, but we may offer this feature in the future. For now, you will not be able to link your selected savings product to a third-party app even if the bank or credit union offering that product does so outside of the Raisin platform.
Email: support.us@raisin.com
|Call: 844-994-EARN (3276) (Monday to Friday from 9:00 a.m. - 4:00 p.m. ET)
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*APY means Annual Percentage Yield. APY is accurate as of {todayDate}. Interest rate and APY may change after initial deposit. Minimum opening deposit is $1.00.
Customer funds are held in various custodial deposit accounts. Each customer authorizes the Custodial Bank to hold the customer’s funds in such accounts, in a custodial capacity, in order to effectuate the customer’s deposits to and withdrawals from the various bank and credit union products that the customer requests through Raisin.com. The Custodial Bank does not establish the terms of the bank or credit union products and provides no advice to customers about bank or credit union products offered through Raisin.com. Central Bank of Kansas City (CBKC), Member FDIC, d.b.a. Central Payments is the Service Bank. CBKC, Lewis & Clark Bank and Starion Bank, each Member FDIC, are the Custodial Banks.