The Best CD Rates in Kentucky for 2025

Navigating the numerous banks throughout Kentucky can be challenging for residents seeking competitive certificate of deposit (CD) rates. To simplify this process, we've evaluated various local Kentucky banks to present the top CD options available in the state.

The Best CD Rates in Kentucky

Fifth Third Bank

Fifth Third Bank normally offers CDs with maturity terms ranging from 7 days to 7 years but their promotional CD rates (specific maturity terms may vary) are known to be the most attractive. The minimum opening deposit for Fifth Third Bank promotion CDs is $5,000.

The Cecilian Bank

The Cecilian Bank offers amazing CD rates across its entire line of maturity terms ranging from 3 months to 6 years. These CD rates are competitive even compared to most CD rates nationwide and beating the CD rates found at many online banks. The minimum opening deposit for The Cecilian Bank CDs is $1,000.

Republic Bank

Republic Bank provides a comprehensive range for CDs from 6 months to 5 years. And, all of their rates are highly competitive and attractive for any saver–some of their promotional CD rates are market-leading. The minimum opening deposit for Republic Bank CDs is $1,000.

Lock In The Highest CD Rates Before Interest Rates Crash Again

The Federal Reserve plans to continue dropping interest rates. To ensure that you continue to generate reliable returns for years to come, consider a CD now to lock in the highest available rates:

Methodology

To choose the best CD rates in Kentucky, the MyBankTracker team reviewed the certificate of deposit accounts offered by the top 50 retail banks by deposit market share in Kentucky (based on FDIC June 2024 data) with more than 5 locations in the state--includes coverage and availability in major cities including Louisville, Lexington, Bowling Green, Owensboro, Covington, and Frankfurt.

The top recommendations are the results of analyzing the CDs based on the following criteria:

• Annual percentage yield (APY) for each CD’s corresponding maturity term
• The number of CD maturity terms available from the bank with which their corresponding APYs are competitive
• Minimum opening deposit requirements

How Do CDs Work?

Certificates of deposit—more familiarly known as CDs—are a type of savings account that holds a fixed amount of money for a specific period. Both traditional savings accounts and CDs offer a safe place to store funds, but there are key differences. A traditional savings account allows you to deposit and withdraw money frequently, usually with a variable interest rate. 

Conversely, a CD requires you to lock in a set amount of money for a fixed period (the “duration” or “term”) in exchange for a guaranteed APY—or Annual Percentage Rate—of return. This means that the interest rate remains constant throughout the CD’s term—regardless of fluctuations in the market. You can read more about CD Basics in our Guide.

How to Pick a Certificate of Deposit

Selecting the right CD involves evaluating several factors to ensure it fits your goals.

Interest rate

The most important thing to compare when shopping for CDs is the interest rate. The higher the interest rate, the more you are going to earn over the CD's Term. However, don’t solely focus on APYs. Be sure to assess your personal timeline of when this amount is needed again.

Maturity term

CD terms can be as short as a few months and as long as five years, or even longer. Longer terms typically offer higher interest rates but reduce the accessibility of your money.

• Short-term CDs (less than a year) may be suitable if you need funds relatively soon or prefer more liquidity.
• Mid-term CDs (1-3 years) offer a balance between the rate of earnings and liquidity. They are the most popular term length.
• Long-term CDs (3+ years) give the highest APYs available from all financial institutions but are less accessible, and the funds aren’t needed for a few years.

Minimum opening deposit

Most banks require a minimum deposit to open a CD, and these amounts can vary significantly. Some financial institutions allow you to open a CD with only a few dollars, while others mandate deposits of at least $500 or $1,000. It’s important to consider your comfort level and available funds when choosing a CD.

Early withdrawal penalty

One major consideration with CDs is the potential for an early withdrawal penalty. If you withdraw your money before the maturity date, you typically incur a penalty, which might be several months of interest. Some banks’ penalties can amount to up to 15 months of the interest earned for a one or two-year CD. In most cases, it negates most of the savings achieved by earning on your investment from opening the CD. It’s important to understand the penalty amount before withdrawing.

Flexibility options

While many CDs have limited flexibility, you should look for these options if needed.

• Bump-up CDs allow you to increase the interest rate one time during the term.
• Add-on CDs let you make additional deposits after you make your first opening deposit.

Compared to Online CDs Available Nationwide

Digital or online banks offer several benefits when compared to traditional brick-and-mortar institutions.

• Higher APYs: Online banks have less overhead. They pass those savings onto consumers in the form of higher interest rates and APYs.
• No Minimum Deposit: Many online financial institutions allow people to open a CD with as little as $1. Traditional banks require at least a $500 and, in some cases, a $1,000 minimum deposit.

FDIC Insurance

Protecting your investments is crucial, and the Federal Deposit Insurance Corporation (FDIC) plays an important role. The FDIC insures deposits up to $250,000 per depositor, per insured bank. This means, if your insured bank fails, you are protected up to this amount. FDIC insurance applies to all CD accounts, including those opened at online banks.

FAQs

What happens when the CD reaches maturity? Does it renew?

When a CD reaches maturity, you will have a grace period—often five to seven days—to make changes. If you don’t initiate any actions, your CD will automatically renew into a CD or similar product.

What is a CD ladder?

A CD ladder is an investment strategy whereby you purchase multiple CDs for different lengths, from short-term to very long-term. This offers higher rates than a traditional CD while keeping some liquidity.

How is interest accrued in a CD?

Interest in a CD is accrued by a daily calculation in a fixed amount over the term. The banks pay interest out in different manners, which includes monthly, quarterly, or yearly.

How are interest earnings in CDs taxed?

Interest earnings from CDs are taxed as ordinary income at the federal level as well as the state, if applicable. The taxpayer is responsible for reporting and paying for interest earnings.