1-year fixed deposits in 2026: See what the current rates are
If you have been looking for a low-risk way to grow your savings, a 1-year fixed deposit could be worth considering. With interest rates shifting in 2026, understanding what banks and financial institutions are currently offering can help you make a more informed decision about where to put your money.
Fixed deposits, often referred to as certificates of deposit (CDs) in the United States, have long been a popular choice for savers who want predictable returns without exposure to market volatility. In 2026, the landscape for 1-year fixed deposit rates continues to be shaped by Federal Reserve policy decisions, inflation trends, and competition among banks and credit unions. Knowing how to read the current market can make a real difference to how much your savings grow over the course of a year.
What Is a 1-Year Fixed Deposit?
A 1-year fixed deposit is a savings product where you lock in a sum of money with a financial institution for exactly 12 months at an agreed interest rate. At the end of the term, you receive your original deposit back along with the earned interest. Unlike regular savings accounts, the rate is fixed for the entire duration, meaning it will not fluctuate with market changes. This makes it a straightforward and predictable savings tool, especially appealing to those who prefer stability over potential high-risk gains.
Current Interest Rates on 1-Year Fixed Deposits in 2026
Following a period of elevated interest rates, 2026 has seen some adjustment in what banks are willing to offer on 1-year terms. Online banks and credit unions tend to offer more competitive rates compared to traditional brick-and-mortar institutions, often due to their lower overhead costs. As of 2026, rates on 1-year fixed deposits at competitive institutions generally range from around 4.00% to 5.25% APY, though these figures can change based on broader economic conditions. It is always worth checking directly with individual institutions for the most current figures before committing any funds.
How Do Banks Determine Fixed Deposit Rates?
The interest rate a bank offers on a fixed deposit is heavily influenced by the federal funds rate set by the Federal Reserve. When the Fed raises rates, banks typically pass on at least part of that increase to deposit products. Conversely, when rates are cut, savings rates tend to follow. Beyond the Fed, each institution weighs factors such as its own liquidity needs, competition from other lenders, and overall market demand for deposits. This is why rates can vary significantly from one bank to another even within the same period.
Comparing 1-Year Fixed Deposit Rates Across Providers
Shopping around is one of the most effective ways to secure a favorable rate. The table below provides a general overview of estimated rates from a range of institution types. These figures are approximate and intended as a starting point for your research.
| Provider | Type | Estimated APY (1-Year) |
|---|---|---|
| Ally Bank | Online Bank | ~4.50% |
| Marcus by Goldman Sachs | Online Bank | ~4.40% |
| Synchrony Bank | Online Bank | ~4.75% |
| Discover Bank | Online Bank | ~4.30% |
| Navy Federal Credit Union | Credit Union | ~4.60% |
| Chase Bank | Traditional Bank | ~0.01%–1.00% |
| Wells Fargo | Traditional Bank | ~0.01%–1.50% |
Prices, rates, or cost estimates mentioned in this article are based on the latest available information but may change over time. Independent research is advised before making financial decisions.
What to Consider Before Opening a Fixed Deposit
Before locking your money away for 12 months, there are a few practical factors worth thinking through. First, consider your liquidity needs. Most fixed deposits come with early withdrawal penalties that can eat into your earned interest if you need access to funds before the term ends. Second, check whether the institution is FDIC-insured (for banks) or NCUA-insured (for credit unions), which protects deposits up to $250,000 per depositor. Finally, consider whether a 1-year term aligns with your financial goals, or whether a shorter or longer term might serve you better.
Are 1-Year Fixed Deposits Worth It in 2026?
For savers looking for a reliable, low-effort way to earn interest without taking on investment risk, 1-year fixed deposits remain a solid option in 2026. While rates may not be at their peak compared to recent highs, they are still historically competitive for deposit products. Pairing a fixed deposit with other savings strategies, such as a high-yield savings account for funds you may need sooner, can give you both security and flexibility across your overall financial picture.
Understanding the current rate environment, comparing providers in your area, and matching deposit terms to your personal timeline are the key steps to making a 1-year fixed deposit work effectively for you.
