I'm Opening Multiple CDs. Should I Stick to the Same Bank?

If you're going to open a CD, the time to do is so now. CD rates are the highest they've been in years, so if you're going to commit to tying up money in the bank, you might as well do so when there's the most financial benefit to be gained. Once the Federal Reserve starts cutting rates, which could happen later this year, you won't be able to earn as much interest on your money.

But putting all of your money into a single CD carries risk. What if you run into a jam and need to cash out a CD early? Doing so usually means losing a few months of interest as a penalty, which negates the benefit of opening a CD in the first place. 

That's why a smarter bet is generally to ladder your CDs. This strategy has you splitting up your money into different CDs with varying maturity dates so some of your cash frees up every few months.

But if you're going to open multiple CDs, should you stick to the same bank or spread your money around? There can be benefits to either approach.

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Capital One 360 Performance Savings APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening. Min. to earn $0 Open Account for Capital One 360 Performance Savings Member FDIC.	APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening.	Min. to earn $0
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The upside of sticking to one bank

If you manage to find a bank whose CD rates are strong across the board, then it could pay to open all of your CDs there. That way, you may have an easier time keeping tabs on your money and tracking your CDs' maturity dates. 

Usually, you can log into an online dashboard and see a list of your various accounts on a single screen. That's much easier than toggling between two or three different screens to check up on your CDs.

The upside of opening CDs at multiple banks

The main reason you wouldn't want to open multiple CDs at the same bank is that you may find that different banks have their own unique offers and CD terms. For example, right now, Marcus by Goldman Sachs has a 20-month rate bump CD with a 4.4% APY. This means you could see your interest rate increase during your CD's term if a better rate becomes available.

Marcus by Goldman Sachs also offers some no-penalty CDs. If you have funds you aren't sure you should commit to a CD but would rather earn more interest than what a savings account will pay you, those could be a good option. You basically get a guaranteed rate without risking a penalty if you decide you need your cash.

If you're going to open multiple CDs, then you really could go either way in terms of sticking to a single bank versus choosing multiple banks. Ultimately, it depends on how important it is to you to have all of your CDs in the same place to track them with ease. If you feel up to the task of having to log into multiple bank accounts regularly, then you might benefit from special CD terms or offers by opening CDs at more than one financial institution.