Best Certificates of Deposit (CD) in New Mexico for 2025
- Bread Savings and First American Credit Union have the highest interest rates of any CDs in New Mexico.
- Loco Credit Union and Rio Grande Credit Union both have excellent returns on their six-month CDs.
- Unlike its competitors, Nusenda Credit Union offers CD terms as low as three months.
- Online bank Ally offers CDs with no minimum deposits.
A certificate of deposit (CD) can effectively grow your savings securely, helping you reach your short-term and long-term goals. New Mexico has plenty of CD options to choose from, with competitive interest rates, various terms, and plenty of other perks.
Keep reading to learn how to maximize your savings with the best CD accounts in New Mexico.
Best CD Rates in New Mexico
Popular Banks and Credit Unions in New Mexico
New Mexico has many highly-rated banks and credit unions that offer excellent savings account APYs and competitive CD rates. Here are some of the most popular banks and credit unions with high-yield CDs:
First American Credit Union: Originally called the Navajo Land Credit Union, First American has the highest CD rates in New Mexico, especially on its 7-month CD.
Loco Credit Union: Founded by teachers, Loco Credit Union has competitive rates on all of its CD terms.
Rio Grande Credit Union: Rio Grande boasts a lower minimum deposit than most competitors while still offering high yields.
Nusenda Credit Union: Nusenda is the largest financial institution in New Mexico, offering competitive rates on a wide range of CD terms
Otero Credit Union: Originally founded for government workers in Otero County, this credit union now boasts high CD rates across the board.
Online Banks: Many online banks offer nationwide CDs with rates that often exceed local banks, making them a great alternative for New Mexico residents.
Online Banks Offering CDs
Many online banks offer competitive CD rates along with a wide range of other perks. Here are some advantages of choosing an online bank for your CD over a local bank or credit union:
- Higher interest rates: Thanks to their low overhead, many online banks are able to offer higher rates than brick-and-mortar options.
- Low minimum deposits: Some online banks have lower minimum deposits, with some requiring no minimum deposit at all.
- 24/7 accessibility: Unlike with a brick-and-mortar bank, you can access your online bank account at any time of day.
- Low or no fees: Online banks often skip the fees that brick-and-mortar banks and credit unions charge. When they do charge fees, they may be lower.
- Quick account setup: You don’t have to visit a local branch to set up an account with an online bank — you can typically set one up in just a few minutes online.
- Mobile app convenience: If you like doing your banking from your phone, an online bank is a great option.
Bread Savings: Bread offers one of the highest APYs on its six-month CD, along with other competitive rates.
American Express: With no minimum deposit, American Express is an especially good option if you want a CD term of longer than a year.
Ally Bank: Ally Bank boasts a high-yield CD, a raise your rate CD (which offers the opportunity for rate increases), and a no-penalty CD with fee-free early withdrawals.
Whether you prefer an online bank, or a local bank or credit union, you can find a CD rate and term that will help you reach your goals.
Factors to Consider When Choosing a CD in New Mexico
When you’re shopping around for the best CD in New Mexico, here are a few factors to consider.
Interest rates and terms
The interest rate on your CD determines how much you can earn. Meanwhile, the term refers to how long you must keep your money deposited to earn the maximum amount of interest and avoid penalties. When shopping for a CD, look for one that offers a competitive rate on the term you need.
For example, if you know you’ll need the money soon, opt for a 12-month CD or shorter. On the other hand, for a goal that’s more than a year out, you may be better off with an 18-month or 24-month CD. The bank with the best rate varies by term.
Credit union vs. local bank vs online bank
If you prefer hands-on service and a local branch you can visit, you may want to open a CD with a local bank or credit union. On the other hand, an online bank is a great option if you don’t necessarily need personalized service, but want the best rates, fees, and convenience.
State tax rates
Like most states, New Mexico has taxes on all income, including the interest you earn in your CDs. Tax rates range from 1.7% to 5.7%, depending on your household income. The amount you’ll pay in income taxes is the same whether you choose a local or online financial institution, but it’s important to prepare for this added cost ahead of time.
Pros and Cons of CDs
CDs offer plenty of benefits, but it’s also important to consider their downsides before you open one. Here are the top pros and cons to consider.
Pros
- Higher returns than traditional savings accounts.
- Fixed interest rates for the entire CD term.
- Flexible terms ranging from months to years.
- FDIC insurance protects your deposits.
Cons
- Requires locking up your money for the entire CD term.
- Returns may be low compared to inflation and high-risk investments.
- Penalties often apply to early withdrawals.
Ready to Start Saving?
New Mexico residents have plenty of options when it comes to finding the best CD rates. Consider your financial goals and shop around for the CD that best suits your needs.
FAQ
Bread Savings currently has the highest-paying CD in New Mexico. If you’d prefer a local bank or credit union, First American Credit Union has the highest rate.
Yes, New Mexico imposes a state income tax on your CD interest and other income. However, that shouldn’t deter you from opening a CD. You’ll still come out ahead!
Local banks and credit unions offer interest rates that are on par with, and often above, those offered by online banks. While Bread Savings has the highest rates right now, many local banks and credit unions beat out most other online options.
