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- You'll receive a notice from your bank when your CD maturity date is approaching.
- Banks offer a grace period once a CD matures; you can renew the term or withdraw money in that time frame.
- Before automatically renewing a CD, always review the current CD rates available at your bank.
If you've received a notice from your bank that your CD term is about to end, you now have to make the decision on what to do with your account. Should you renew it for another term or transfer your money to another type of savings account?
We'll explain the CD maturity process and what to do when a term ends so you know your options.
What happens at CD maturity
When a CD reaches maturity, that means your term is about to end. You'll have several CD renewal options at the end of a term length.
You can choose to renew your CD for another term or move all your money to another account at the same bank or a different bank. You could also withdraw it from your bank if you need your money immediately.
What the CD grace period means
Financial institutions will specify in the bank account agreement a grace period to make changes to your account. The grace period is a short time frame, usually around 10 days, when you can withdraw your money and transfer it to another bank account.
During the grace period, you won't have to worry about penalties or fees. A CD early withdrawal penalty only occurs when you take out money from a CD before the term ends.
If you do not notify your bank to make changes, the bank will usually automatically renew your CD for another term. However, be aware the interest rate for your CD rollover may not necessarily be the same as when you first opened it.
CD grace period of 20 of the biggest financial institutions
| Account | Grace period for CD |
| Alliant Credit Union CD | 10 days |
| Ally High Yield CD | 10 days |
| Bank of America Fixed Term CD | 1 day for terms 27 days and under; 7 days for terms 28 days or longer |
| Bethpage Federal Credit Union Certificate Account | 7 days |
| Capital One 360 CD | 10 days |
| Chase CD | 10 days for terms 14 days or longer |
| Citi Fixed Rate CD | 7 days |
| Citizens Access Online CD | 10 days |
| Connexus Credit Union Share Certificate | 10 days |
| Discover® CD | 9 days |
| Fifth Third Bank Standard CD | 1 day for terms 31 and under; 10 days for terms 32 days or longer |
| Marcus High-Yield CD | 10 days |
| Navy Federal Credit Union Standard Certificate | 21 days |
| PNC Fixed Rate CD | 1 day for terms 31 days and under; 10 days for terms 31 days or longer |
| Quorum Federal Credit Union Term Savings | 7 days |
| Synchrony Bank CD | 10 days |
| TD Bank Choice Promotional CD | 10 days |
| Truist Bank CD | 1 day for terms 31 days and under; 10 days for terms 32 days or longer |
| Wells Fargo Standard Fixed Rate CD | 7 days |
How to decide whether to renew a CD or close it
Alvin Carlos, CFA, CFP, financial planner, and managing director of District Capital Management, says in most cases, he recommends that people shouldn't automatically renew a CD. Instead, Carlos suggests that people consider whether they'll need the money for a particular reason relatively soon.
Carlos also recommends comparing the current interest rates for CD terms before making your decision. Check to see if the rate at your bank has changed since you last opened your account. You can also stack up your bank's CD rates to the best CD rates to see which financial institutions are the most competitive.
If you're interested in more flexibility with your money, a CD ladder strategy could also be worth exploring. You'll open several CDs of different term lengths and distribute your money across these accounts. One of the advantages of building a CD ladder is that at different maturity dates, you'll have access to some of your money.
Alternatives to CDs
If you've decided you'll need access to your money relatively soon, a high-yield savings account or money market account are alternative savings account options.
These bank accounts allow you to earn more interest on your money than a regular savings account, but they have more flexibility than a traditional CD. You'll be able to make additional deposits or withdraw funds each month. However, there could be excess withdrawal fees depending on where you bank.
An excess withdrawal fee occurs when you make more than six transactions per month from a savings account. The Board of Governors of the Federal Reserve has amended Regulation D — a federal rule that specifies transfer limits for savings accounts — so financial institutions may choose to suspend the monthly transfer limit so customers can make unlimited monthly transactions. Some banks and credit unions enforce the six-transactions-per-month limit while others do not.
How to close a CD
The process for closing a CD upon maturity varies across financial institutions. Some banks, like Ally Bank, let you close a CD through online banking. Other financial institutions, such as Synchrony, may require you to call customer support. If you bank with a local bank, you might have to go to a local branch to fill out some paperwork to initiate the withdrawal.
If you're transferring money to another bank account, it should be moved into your account within the same day. If you are moving money to a bank account from another financial institution, it may take a few days to process.
Certificate of deposit maturity FAQs
When a CD reaches maturity, you'll be able to withdraw money from the account. Most financial institutions automatically renew CDs, so you can only make free CD withdrawals during the grace period (a short time frame when you can make changes to your account without facing penalties). You may choose to take out all your money from a CD, make a partial withdrawal, or leave it for another term.
The maturity of a CD depends on the length of the term. The most common CD maturity dates range from six months to five years after you open an account.
In normal circumstances, you cannot lose money on a CD. There is no CD maturity penalty if you keep money in the account until it fully matures. CDs are federally insured bank accounts, so it's a low-risk savings option. Even in the rare situation that a bank fails, the FDIC will protect up to $250,000 per depositor, per account category.
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