Capital One CD Rates: Pros, Cons, and Current Rates

Business Insider's personal finance team compared Capital One 360 CD rates to the best CD rates and found them to be a standard offering. 

While Capital One 360 fixed CD rates are excellent compared to brick-and-mortar banks, other online banks generally offer better rates. Capital One 360 is considered an online bank, but unlike most online banks, Capital One 360 has physical branches you can go to if you want to bank in person.

Capital One 360 is also fairly straightforward when it comes to its options — it has traditional CDs ranging from six months to five years. It doesn't have any specialty CDs, like no-penalty CDs or bump-rate CDs.

If you want online bank CD rates while still being able to bank in person, Capital One 360 CDs might be a good choice for you. But if you're just interested in the highest CD rates, or if you want specialty CDs, you might want to bank elsewhere.

Current Capital One CD Rates

Capital One 360 CD rates are 3.50% to 4.00% APY.

Capital One Bank CD rates are more competitive than the average CD rate, regardless of which term you want. That being said, the best CD rates from online banks and credit unions are even higher.

Capital One 360 also has standard term lengths from 6 months to 5 years. Other banks and credit unions offer extended term lengths if you're interested in shorter CDs, like 3-month CDs, or longer CDs, like 10-year CDs.

Overview of Capital One CDs

Capital One CDs could be a good choice if you want strong interest rates well above the national average, but you don't want to give up an in-person banking experience. Capital One CDs are generally much higher than what you can find at other brick-and-mortar banks, although its rates are lower than what you can find at the best online banks or credit unions. The CDs also have a very low minimum opening deposit of $0, which is very rare for CDs.

If you're interested in specialty CDs, such as bump-up CDs, no-penalty CDs, or jumbo CDs, you'll probably prefer a different bank; Capital One only has standard fixed-rate CDs.

Capital One CD Rates Pros and Cons

Capital One CD Rate Pros

• National brand with high interest rates on a variety of terms
• $0 minimum opening deposits
• Low early withdrawal penalties

Capital One CD Rate Cons

• Doesn't offer specialty CDs (bump-up CDs or no-penalty CDs)

Capital One CD Alternatives

Capital One CDs vs. Ally CDs

Both online banks are among the few that let you open a CD with $0.

If you're strictly looking for which one offers the higher interest rate, Ally may be a better option if you're looking for short-term CDs. Ally's CD rates are 2.90% to 3.90% APY. Ally also has an 11-month Ally No Penalty CD and a 2-year or 4-year Raise Your Rate CD, so it's the better choice if you're looking for specialty CDs. The latter gives you the option to increase your rate should Ally's rates go up during your term — once during the two-year term, and twice during the 4-year term.

If you want traditional long-term CDs, Capital One 360 might be a better choice. Ally doesn't offer 2-year and 4-year traditional CDs, and Capital One 360 CD rates for long-term CDs are generally pretty similar to long-term Ally CD rates.

Ally Bank Review

Capital One CDs vs. Marcus CDs

If you're just looking for the highest CD rates, Marcus CD rates are higher than Capital One 360 CD rates for some CD terms; Marcus CD rates are 3.75% to 4.25% APY. There is also a Marcus No-Penalty CD with 7-month, 11-month, and 13-month terms, as well as a 20-month rate-bump CD.

Keep in mind Marcus requires $500 to open a CD. If you don't have that much cash ready, Capital One is the clear choice. Capital One is also the clear choice if you want to bank in person; Marcus is an online-only bank.

Marcus Bank Review

How to Open a Capital One CD

You can open a Capital One 360 CD online if you're a U.S. citizen or permanent resident who is at least 18 years old. To apply for the account, you'll need to provide basic information like a social security number, a U.S. address, and your phone number. If you want to use an ITIN number to open a bank account, you can visit a Capital One location to open an account.

Once you've opened a CD, you'll need to link another Capital One account or an external bank account. Capital One is one of the few banks that have CDs with a $0 minimum deposit, so you can open a CD regardless of how much money you have. You can put up to $1 million in a Capital One CD; just keep in mind that only $250,000 of your money will be covered by FDIC insurance if you're the sole owner of the account. FDIC insurance protects you in case of a bank failure.

Capital One 360 CDs have a monthly compounding frequency, which is also how often interest is deposited. You can choose to have interest deposited into your CD, moved into a Capital One savings or checking account, or transferred into an external linked account. You have to make that decision in the first 20 days after you open your account, though; if you don't make a decision, your interest will go into your CD. Keep in mind that the APY stated above assumes that interest will stay in the CD.

Your CD will automatically renew into a CD with the same term length — but not necessarily the same interest rate — when it matures unless you tell Capital One that you don't want it to renew. If you haven't told Capital One not to renew your CD, you have a grace period of 10 days after your CD matures to withdraw your money without penalty. After that, you'll need to wait for the end of the new CD's term length to withdraw without penalty.

Should You Open a Capital One CD?

Capital One might be a good place to open CDs if you prioritize banking with a national brand. It also has a decent range of terms, so you could build a CD ladder to protect against rate volatility. You also may have more account flexibility since you'll have access to some of your funds at different maturity points.

If you're strictly looking for the highest CD rates available, however, there are other financial institutions with even higher rates right now.

Why You Should Trust Us: How We Reviewed Capital One 360 CDs

We rate bank accounts on a scale from one to five stars. For our CD review, we used our CD methodology, which looks at interest rates, minimum opening deposits, early withdrawal penalties, CD variety, customer support availability, mobile app ratings, miscellaneous features, security, and the ethics of the company.

We use a weighted average to get our star rating, which means we weigh certain features, like interest rates and fees, at a higher weight percentage than others. We understand that these areas can more heavily impact a person's overall banking experience.

Capital One 360 CD Rates FAQs