If you’re interested in learning about Vanguard CD Rates, then keep reading. Vanguard CD rates are among the most competitive in the market. The CD rates range from 0.80% APY up to 1.75%. You could be earning a lot of interest the longer the term of your CD.
Vanguard CD rates: an overview
Vanguard CD rates are the among most competitive in the market currently. They offer higher rates than most Bank CDs.
You will for sure earn considerably more interest than a regular savings account or money market fund.
However, with Vanguard CDs, you will need a much bigger deposit — usually around $10,000 minimum.
That can be a hefty amount for a beginner investor. If you can afford it, however, then keep reading.
Of note, Vanguard offers brokered CDs. And That is why its rates are higher than Bank CDs.
What is a CD (certificate of deposit)?
CDs are certificates that banks or credit unions sell to you. Banks issue them to you for a specific dollar amount for a specific length of time.
The time period could be anywhere from 1, 6, 12 or 24 months to several years.
The bank pays you some interest. You get your full principal back plus interest you earn once the CD matures or “comes due.” If you want your money back before it matures, you can withdraw it.
But a penalty will apply for early withdrawal. However, there are some banks, like CIT Bank, that offer CDs with no penalty.
Certificate of deposits just like bank savings accounts are very safe. That is because the FDIC insure you for up to $250,000.
So, if you’re looking for safety for your savings and competitive yield, CDs appropriate investments.
What is the difference between a bank CD and a brokerage CD?
The difference between a bank CD and a brokered CD is simple. First, you must know that there are two types of CDs. One is Bank CD; the other is brokered CD.
Vanguard issues “brokered CDs”. Banks offer “bank CDs.” Brokered CDs are issued by banks. They are sold in bulk through brokerage firms such as Vanguard and Fidelity.
Bank CDs, brokered CDs are insured by the federal government of up to $250,000.
Even though Vanguard CD rates are usually competitive, Vanguard brokered CDs don’t always provide higher yields than bank CDs.
But longer term brokered CDs such as the Vanguard 10-year CD offer high rates.
Should You Use Vanguard CDs?
As mentioned above, Vanguard CD rates are very competitive. So, they may be an appropriate investment for you.
So, you should consider them if:
- You’re investing for a short-term goal, such saving for a down payment to buy a house, in the next few years.
- You are looking for peace of mind knowing that your money is insured by the FDIC. But note that the FDIC insures only up to $250,000. So if you have more money than that, you should open another CD account.
- You’re looking for an investment that provide higher yields than banks savings accounts;
- You want a low-risk place to keep your cash.
What are the Vanguard CD rates?
Vanguard offers brokered CDs ranging from 1 month to 10 years. As you can see, the longer the term of the CD, the higher the rate. For example, a Vanguard CD for a 7-year term offers a 1.50% yield.
Whereas a Vanguard CD’s rate for a 1-year term is only 1.20%. You can buy Vanguard CDs commission free and you can sell them commission free before they mature.
Vanguard 1-Month CD Rates.
The yield for a 1-Month Vanguard CD is 0.80% and a minimum deposit of $10,000 is required. This is the shortest term of Vanguard CD. However, even if it is only one month, its rate is still very competitive.
Vanguard 3-Month CD Rates.
For a 3-Month Vanguard CD, the yield is 0.80%. The minimum deposit is $10,000.
Vanguard 6-Month CD Rates.
The yield for a 6-month Vanguard CD is currently 1.00%. Vanguard brokerage CD requires a $10,000 minimum deposit.
Vanguard 9-Month CD Rates.
The applicable yield for a 9-Month Vanguard CD is still very competitive. It’s 1.05% and requires a $10,000 deposit.
Vanguard 1-Year CD Rates.
The yield for a 1-Year Vanguard CD is 1.20% and a minimum deposit of $10,000 is required.
Vanguard 18-Month CD Rates. For a 18-Month Vanguard CD, the yield is 1.20%. The minimum deposit is $10,000.
Vanguard 2-Year CD Rates
For a 2-year Vanguard CD, the yield is 1.30%. The minimum deposit is $10,000.
Vanguard 3-Year CD Rates.
The rate for a 3-Year Vanguard CD is 1.40% and a minimum deposit of $10,000 is required.
Vanguard 5-Year CD Rates.
The applicable yield for a 5-Year Vanguard CD is still very competitive. It’s 1.50% and requires a $10,000 deposit.
Vanguard 7-Year CDs.
This 7-year Vanguard CD also requires a minimum deposit of $10,000. This CD’s yield is a little less than the Vanguard 10-year CD. Nonetheless, it’s still higher than most bank CDs. The yield is currently is 1.50%.
Vanguard 10-Year CD Rates.
The applicable rate for a 10-Year Vanguard CD is currently 1.75%. And it requires a minimum deposit of $10,000.
This is the longest Vanguard CD term out there. And its interest rate exceeds most CD rates you’d get from banks.
How do I open a Vanguard CD
Opening a Vanguard CD should be very easy. You should go to their ‘Buy a CD‘ homepage to learn more about their products. To buy a CD, however, you will need to first create an account to log on. Once you do that, you are able to choose and pick the best CD term that suits your particular needs.
Vanguard CDs might be a good choice for you if you want to avoid risky investments and you are saving your money for a short-term goal such as going on a vacation.
Indeed, Vanguard CD rates are better than bank savings accounts and money market accounts. But the money is only available after the CD “matures.” On the other hand, if access to your money at anytime is a priority, check out the best Vanguard Index Funds.
Speak with the Right Financial Advisor
- If you have questions about your finances, you can talk to a financial advisor near you who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc).
- Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals.