You’ve likely heard of Goldman Sachs, the global investment services firm that’s been around since 1869 and has over $2.1 trillion in assets under management, but you might not be as familiar with their digital subsidiary, Marcus.
Marcus by Goldman Sachs is an online-only, FDIC-insured bank based out of Salt Lake City, Utah.
On the savings side, Marcus offers a full suite of deposit accounts. These include:
- 9 regular CDs (certificates of deposit) with terms ranging from 6 months to 6 years,
- a No-Penalty CD with a 13 month term,
- a Rate Bump CD with a 20 month term and
- a variable-rate online savings account.
For the purpose of this review, we will just focus on Marcus by Goldman Sachs’s CDs and their rates – which all beat the national average by comfortable margins.
To see if their CDs are right for you, continue reading below.
Marcus CD Rates + Account Details
All of the CDs offered through Marcus by Goldman Sachs come with a low minimum deposit requirement of just $500 and are FDIC insured up to $250,000 per depositor. This includes their standard CDs as well as their No Penalty CD and Bump Up CD.
|13 month No-Penalty CD||3.85%|
|20 month Rate Bump CD||4.35%|
To put the offers above in perspective, the current national average for 12 month CDs and 60 months CDs sit at just 1.36% APY and 1.26% APY, respectively, according to FDIC data.
That said, top yields from other online banks and credit unions with nationwide acceptance are now inching over the 5.00% and 4.50% APY mark for the same respective terms.
No- Penalty CDs
Marcus by Goldman Sachs currently offers one No Penalty CD with a 13 month term and a minimum deposit requirement of $500.
The no-penalty CD is much more liquid than your standard CD as it comes with no early withdrawal penalty – meaning your funds are accessible at any time.
You’ll earn the fixed APY for the duration of your CD, but you can withdraw up to 100% of the funds 7 days after issuance without incurring any penalty fee.
Rate Bump CD
Marcus’s newest CD offering is their 20 month Rate Bump CD. This is a great product for a rising interest rate environment because they let account holders raise the rate of their CD one time during its duration. Of course there are no penalties or fees associated with changing the rate and you may request to change it whenever the CD holds a higher rate than the one you are locked in with.
As with all of Marcus’s CDs, this one also comes with a minimum deposit requirement of $500.
Compounding and Crediting Interest
Interest on Marcus CDs is compounded daily and credited back to your account monthly.
Interest is compounded using the daily balance method, meaning the interest rate is applied to your principal and all accrued interest every day. You can learn more in their Truth-in-Savings disclosure forms.
10-Day Rate Guarantee
Marcus CDs are backed by a 10-day Rate Guarantee, which promises the highest published interest rate and APY (annual percentage yield) Marcus has to offer on your term for 10 days after certificate issuance. Essentially, you’ll get the highest rate on your account as possible for a short time—you aren’t locked into a rate until that 10-day period is up. To ensure that this safety net is enforced, just make sure you have the $500 minimum deposited in the account within this time period.
Grace Period and Early Withdrawal Fees
There is a 10 day grace period within which you should try to make any changes or withdrawals after a CD renews.
If nothing is done during this grace period CDs automatically renew with the same term and the going APY at that time.
If you need the funds from your CD prior to its maturity you will incur an early withdrawal fee (not applicable to No Penalty CD specials).
Early withdrawal fees are as follows:
- For terms of less than 1 year, you’ll be charged 90 days’ simple interest
- for terms of 1 – 5 years, you’ll be charged 270 days’ simple interest
- for terms more than five years, you’ll be charged 365 days’ simple interest.
How to Open and Fund the CD
Marcus CDs must be opened online. To get started go here and have the following pieces of personal and financial information readily available to expedite the process:
- Your Social Security number
- A government-issued ID
- A valid email address
If transferring funds from another bank or credit union, please have:
- your current bank or credit union’s routing number
- bank account number where the funds will be withdrawn from to fund your Marcus CD
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