Skip Navigation LinksHelp Topics > CDs > The Basics
Skip The Basics Links

The Basics

What is a CD?

Certificates of Deposit (CDs) allow you to lock in a rate of return for the length of the CD. The CD offers great rates with guaranteed returns and is available in terms ranging from 6 to 60 months. CDs are great for reaching your savings goals faster using money that you don't need immediately. Plus, all deposits are FDIC-insured up to $250,000 per depositor.

CD Account Terms & Conditions Opens a new window

How is interest calculated on a CD?

Interest on your CD is accrued daily and compounded monthly.

Is there a penalty for early withdrawal?

As with any CD, there is a penalty for withdrawal prior to the maturity date:

  • For a CD term that is 12 months or less, the penalty is three (3) months of interest regardless of when, prior to maturity, you make a withdrawal.
  • For a CD term that is longer than 12 months, the penalty is six (6) months of interest regardless of when, prior to maturity, you make a withdrawal.

Depending on how early you redeem an CD, the early withdrawal penalty may be greater than the interest you have earned on the deposit and thus would be subtracted from the initial amount.

What is a CD Ladder?

A CD ladder can help you earn an even higher return on your savings. A ladder consists of multiple, sequential CDs all opened at the same time. Each "rung of your ladder" is for a different CD term and your ladder can contain as few or as many rungs as you like.

For example, a ladder could consist of 12, 24, 36, 48 and 60-month CDs. Or for a less aggressive CD ladder you could choose shorter terms – such as a 6, 12, 18, 24 and 30-month ladder, which will keep your money more readily available.

Let’s say you have $10,000 to invest and want to start a 5-rung, annual ladder (12, 24, 36, 48 and 60-month CDs). You could invest $2,000 in each term. As each CD matures, re-invest the principal and interest into the longest term on your CD Ladder (in this case a 60-month CD). With this scenario, you’ll benefit by having at least $2,000 becoming available each year should you need access to your money, while at the same time having all your money in longer term CDs, which usually have a higher rate than shorter term deposits.

Can I add money to my CD once it has been opened?

While you can't add money to an existing CD, you can open additional CDs at any time.

Can I receive interest disbursements from my CD?

Yes. You can choose to receive interest disbursements on a monthly or yearly basis (on the anniversary date of the account opening). Interest disbursements can be sent to your 360 Checking, your 360 Savings, or an external linked checking account. You can change the account to which interest is disbursed at any time. The ability to select or deselect interest disbursement is only presented for 20 calendar days from account opening.

Can my CD be a living trust?

Yes. You can register your account(s) in the name of a Revocable Living Trust. Before you do this, make sure the ownership on your Capital One 360 account(s) matches your trust. For example, the Grantor of your trust must be the primary account holder and at least 18 years old. If you list a Trustee, he/she must also be the joint account holder.

To make ownership changes, sign in to, click on your account(s) and then click on the ‘Account Details’ tab.

To register your account(s) in the name of a Revocable Living Trust, click on your account(s), go to the 'Documents' tab and complete the online registration Opens a new window process or complete the ‘Certification of Trust' form. Keep in mind:

  1. The Grantor and Trustee must be 18 or older.
  2. If the Grantor’s name isn’t included in the title of the trust, you’ll also need to send a copy of the first page of the trust document.
  3. The Grantor and Trustee names and addresses on the 'Certification of Trust' form Opens a new window must match the account information we have on file.

If you choose to fill out the ‘Certification of Trust Opens a new window’ form instead of registering online Opens a new window, you can return it along with any supporting documentation one of three ways:

Email: Opens a new window
Fax: 1-877-464-3714
Mail: Capital One 360
P.O. Box 60
St. Cloud, MN 56302

Please note, we are unable to register your account(s) as an Irrevocable Living Trust.

Is there a limit to the number of accounts I can have with Capital One 360?

Yes. There is a limit to how many accounts each Customer can have (don’t worry, we doubt you’ll even get close to it) with Capital One 360. You could be either a primary or joint account holder on a specific account and it would still count as one account. Here’s how it breaks down:

  • 360 Savings, 360 Money Market and Business Savings Accounts: 25 combined accounts
  • CDs and Business CDs: 50 accounts max
  • 360 Checking: 1 account

Please note: IRA Savings and IRA CD accounts are not included in the total number of 360 Savings and/or CDs you can have.

What is backup withholding?

Backup withholding is when someone makes certain payments to you and you must withhold and pay 28% of those payments to the IRS. Payments that may be subject to backup withholding include, but are not limited to, interest, dividends and broker and barter exchange transactions.

If you provide your correct Social Security Number, make proper certifications and report all your taxable interest and dividends on your tax return, payments you receive should not be subject to backup withholding.

How do I update my backup withholding status?

Updating your backup withholding status is easy. Just follow these steps:

  1. Visit Opens a new window or call the IRS at 1-800-829-1040 to obtain a W-9 Form
  2. Fill out and send in the W-9 Form to advise us of your updated withholding status
    • Fax: 1-877-464-4963, ATTN: Operations Research
    • Mail: Capital One 360, ATTN: Operations Research, P.O. Box 60, St. Cloud, MN 56302.

Your backup withholding status will be updated the day we receive the W-9 Form and funds will/won't be withheld beginning that month.

Please Note:

  • If your account(s) is jointly held and the joint holder needs to update their withholding status, they also need to follow the steps listed above.
  • To update backup withholding for a minor, a parent or guardian may sign their own name on the W-9 Form in place of the minor.
  • To update backup withholding for a Business Account, an Authorized Signer can complete and return the W-9 Form.

How do I request a Verification of Deposit (VOD)?

Requesting a Verification of Deposit (or VOD) is easy. Here’s how:

  1. Sign in to
  2. Click on one of your accounts
  3. Go to the 'Documents' tab
  4. Under the "Verification of Deposit" section, click the 'Verification of Deposit' link to generate and print a form

You can select which accounts you want included. Keep in mind, your account must be open for at least 30 days to be included.

What is FATCA reporting?

FATCA (Foreign Account Tax Compliance Act) reporting applies to accounts held with foreign financial institutions. Since Capital One 360 is a U.S. institution, our US Customers are not subject to FATCA reporting. However, the IRS still requires you to certify that you are not subject to this reporting.

What is the 10-Day rate lock guarantee?

We will lock the interest rate for your CD for up to 10 calendar days if you fund your account within this time period.  We will also match any interest rate increases during this 10-day period, up to the time you fund your account.

Keep in mind that the funding process may take a few days as you need to confirm ownership of your external account. If you fund your account after the rate lock period is over, you will receive the applicable interest rate and APY on the business day we receive your funds. If we don’t receive funds within 60 days of account opening, your account will be automatically closed.

Banking, Credit Card, Auto Finance, and Home Loan products and services are offered by the Capital One family of companies, including Capital One Bank (USA), N.A. and Capital One, N.A. NMLS ID 453156, Members FDIC.

All entities are separate but affiliated legal entities of Capital One Financial Corporation, each is responsible for its own products and services.

Securities are offered by Capital One Investing, LLC, a registered broker-dealer and Member FINRAOpens a new window/SIPC Opens a new window . Advisory services are provided by Capital One Advisors, LLC, an SEC registered investment advisor. Insurance products are offered through Capital One Agency LLC. All are subsidiaries of Capital One Financial Corporation.

Securities and services are: Not FDIC insured • Not bank guaranteed • May lose value • Not a deposit • Not Insured by any Federal Government Agency

© 2016 Capital One. All rights reserved.