If you're looking for a CD that offers simplicity and high APYs, you've found it with BMO Alto's CDs. While online-only banks like BMO Alto lack physical branches, that lack of overhead tends to allow them to offer CDs that earn higher rates. Here's what you need to know to decide if BMO Alto's CDs are right for your savings.
What we'll cover
- How do the BMO Alto CDs work?
- Are the BMO Alto CDs worth it?
- Alternatives to BMO Alto
BMO Alto CDs
BMO Alto is a Member FDIC.
Annual Percentage Yield (APY)
From 4.00% to 4.80% APY
Terms
From 6 months to 60 months
Minimum deposit
None
Monthly fee
None
Early withdrawal penalty fee
An early withdrawal of principal before maturity will cost an early withdrawal penalty. The penalty is calculated using the interest rate applicable to the CD at the time of early withdrawal. If the amount of the penalty exceeds the amount of your accrued and unpaid interest, then a reduction of principal would be required in order to pay the penalty:
Terms apply.
Pros
- Above-average APYs
- Range of CD terms
- No minimum deposit
- No monthly fee
Cons
- You can't access your money before your CD term ends
- Early withdrawal penalty fees apply
- No physical branch locations
Compare offers on CDs
How do the BMO Alto CDs work?
BMO Alto offers competitive CD rates at terms that range from six months to five years. BMO Alto doesn't charge any fees on its CDs, including monthly maintenance fees.
How to fund your CD
You have two options to fund a CD: Either link an external account to BMO Alto Online Banking and move your money via an ACH transfer, or you can initiate an ACH transfer from your external bank account using your BMO Alto CD routing and account numbers.
Access to your cash
All of BMO Alto's CDs are traditional, meaning you make one initial deposit and then can't withdraw any of your money before the CD's term ends — at least, not without paying a penalty.
Once your CD matures, you can withdraw your money at no charge during a 10-day grace period. You can then transfer the money in the CD to either another BMO Alto account or an external account. If you take no action, BMO Alto will automatically renew to another CD with the same term length.
Fees and penalties
While BMO Alto doesn't charge any fees on its CDs, it does levy an early withdrawal penalty if you take money from your account before the CD matures. For CDs with terms of 11 months or less, this penalty is 90 days worth of interest. For CDs with terms of 12 months or more, the cost is 180 days worth of interest.
Are the BMO Alto CDs worth it?
With its competitive rates and no fees, the BMO Alto CDs are a great option if you're looking to lock away your funds and secure a high rate. However, BMO Alto is an online-only bank, so you'll have to be comfortable with not having a physical location to visit if you have any questions.
Unlike many banks, BMO Alto doesn't offer specialty CDs, such as no-penalty or add-on CDs, that allow a little more flexibility in how you manage your funds. Nonetheless, these CDs could be good if you're just simply looking for a place to store your money where it earns a high rate of return.
Alternatives to BMO Alto
If you'd like more flexibility with your CDs, Synchrony Bank offers a variety of options, including standard CDs, a Bump-Up CD (get a higher rate), a No-Penalty CD (withdraw penalty-free) and an IRA CD (save for retirement).CD term lengths range from three months to five years, and you can earn a high APY. While there are no physical branch locations, you can access customer service seven days a week by phone or online chat, and 24/7 through the app.
Synchrony Bank CDs
Synchrony Bank is a Member FDIC.
Annual Percentage Yield (APY)
From 0.25% to 5.15% APY
Terms
From 3 months to 60 months
Minimum balance
None
Monthly fee
None
Early withdrawal penalty fee
There may be an early withdrawal penalty if you withdraw funds from the principal prior to the CD maturity date (the last day of the CD term). The penalty is applied to the amount of principal withdrawn (there's no penalty on interest). For the No-Penalty CD, early withdrawals are not permitted within the first 6 days after account funding. Following that, only withdrawal of the entire balance is allowed.
Terms apply.
APYs are subject to change at any time without notice. Offers apply to personal accounts only. Fees may reduce earnings. For CD accounts, a penalty may be imposed for early withdrawals. After maturity, if your CD rolls over, you will earn the offered rate of interest for your CD type in effect at that time.
If you're more comfortable banking with a larger institution, Marcus by Goldman Sachs® CDs offer terms ranging from six months to six years, with rates also in a competitive range. While Marcus by Goldman Sachs requires a $500 minimum deposit requirement, there are no monthly maintenance fees. Their U.S.-based contact center is also open 24/7 for live customer support via phone or online chat.
Marcus by Goldman Sachs® CDs
Marcus by Goldman Sachs® is a brand of Goldman Sachs Bank USA, a Member FDIC.
Annual Percentage Yield (APY)
From 3.90% to 5.10% APY
Terms
From 6 months to 6 years
Minimum deposit
$500
Monthly fee
None
Early withdrawal penalty fee
If you withdraw the balance entire principal amount from your CD account prior to maturity, you'll be charged anearly withdrawal penaltybased on the term of your CD and the principal (except in the case of a No-Penalty CD). Here's how early withdrawal penalties are calculated:
Early Withdrawal Penalty = Interest Rate ÷ 365 (or 366) × Penalty Days × Original Principal Balance
Terms apply.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
