APY (1Y / 5Y), June 2026 (not current)
5.10% / 4.40%
Short answer
Yes, Vanguard sells CDs in its IRAs, but they are brokered CDs issued by other banks: $1,000 minimum in $1,000 increments, no commission on new issues, and FDIC coverage up to $250,000 per issuing bank (investor.vanguard.com, October 3, 2026). Rates are set by the issuing banks and change daily; for scale, the 5-year Treasury yielded 5.06% on October 2, 2026 and the best 5-year bank CD we verified paid 4.50%. Inside an IRA there is no annual tax on the interest either way.
Vanguard offers brokered CDs inside any Vanguard brokerage IRA (Traditional, Roth, SEP, SIMPLE, Inherited). The platform is functional but materially smaller in scope than Fidelity's or Schwab's: Vanguard's bond desk carries inventory from fewer issuing banks, the ladder tool is more basic, and secondary-market liquidity for selling before maturity is thinner. For buyers whose primary retirement assets are Vanguard mutual funds and ETFs, the convenience of holding IRA CDs in the same account often outweighs these limitations.
Vanguard does not set its CD rates; each issuing bank does, and the menu changes daily. Use these dated benchmarks to judge any Vanguard IRA CD quote:
| Benchmark | Yield | As of |
|---|---|---|
| 1-year Treasury (par yield) | 4.46% | October 2, 2026 |
| 2-year Treasury | 4.83% | October 2, 2026 |
| 5-year Treasury | 5.06% | October 2, 2026 |
| 10-year Treasury | 5.28% | October 2, 2026 |
| Marcus 12-month bank CD (APY) | 4.40% | October 3, 2026 |
| Synchrony 60-month bank CD (APY) | 4.50% | October 3, 2026 |
| A-rated 5-year MYGAs | about 5.50% to 6.05% | October 14, 2026 |
Sources: U.S. Treasury daily par yield curve (October 2, 2026); marcus.com and synchrony.com rate pages (October 3, 2026); public carrier rate sheets (October 14, 2026). Vanguard’s own brokered CD yield table (investor.vanguard.com/investment-products/cds) showed no figures when we checked on October 3, 2026; it fills in on business days. New-issue brokered CD rates are set by the issuing banks and change daily.
| Term | New-issue APY range |
|---|---|
| 3 month | ~4.20-4.50% |
| 6 month | ~4.55-4.85% |
| 9 month | ~4.75-5.00% |
| 1 year | ~4.85-5.10% |
| 2 year | ~4.55-4.85% |
| 3 year | ~4.40-4.70% |
| 5 year | ~4.30-4.60% |
| 7 year | ~4.20-4.45% |
| 10 year | ~4.10-4.45% |
Yes, as brokered CDs. Vanguard Brokerage sells brokered CDs only; it cannot buy or hold a CD you open directly with a bank. You buy them inside a Vanguard brokerage IRA, with interest paid into the IRA’s settlement fund on the issuing bank’s schedule, as simple interest (investor.vanguard.com, October 3, 2026). At maturity, principal and interest land in the settlement fund as cash; nothing renews automatically.
None on new issues: Vanguard says it charges no commission for brokered CDs bought on the primary market, though it may receive a concession from the issuer. Buying on the secondary market costs a commission, selling an existing CD position is commission-free, and secondary trades placed by phone carry an extra $25 broker-assisted fee (Vanguard, October 3, 2026).
This is the single most misunderstood point. An IRA CD is taxed like any other IRA asset, not like a taxable bank CD.
If you are under age 59½ and withdraw, two penalties can stack: the bank's early withdrawal penalty (typically 90 to 365 days of interest) and the IRS 10% additional tax on the withdrawn amount. The bank's penalty is enforced by the bank; the IRS penalty is enforced via Form 5329 on your tax return.
From my desk: Hans Goldstein, licensed insurance producer (NPN 20602398)
Most of the IRA CD questions I get are really RMD questions. A retiree at 73 puts the whole IRA into one 5-year brokered CD, then needs a distribution in year two. A brokered CD has no early-withdrawal penalty, but it has to be sold at the market price, and when rates have risen that price is below what you paid.
So I build IRA money in rungs: the next one or two years of RMDs in short CDs or Treasuries, and only the money that can truly sit five years in a 5-year product. That is also where I compare a 5-year IRA MYGA, since most allow the RMD amount out penalty-free each year (confirm with the carrier in writing).
Example: $300,000 IRA, RMD around $11,000 a year. Two rungs of about $11,000 each in 1 and 2-year CDs or T-bills, the rest in 5-year money. At the dated rates above, the 5-year portion ($278,000) is worth about $346,400 at 4.50% or about $363,300 at 5.50%. See IRA CDs for RMDs, brokered vs bank CDs and Treasury bills.
Three scenarios:
An IRA MYGA (multi-year guaranteed annuity) is, in plain English, a CD-equivalent issued by an insurance carrier instead of a bank. Inside an IRA wrapper, both are tax-deferred. The tax wrapper is identical. The difference is the rate, the insurance backing, and the surrender mechanics.
| Feature | IRA CD (bank) | IRA MYGA (insurance) |
|---|---|---|
| 5-year rate | 4.50% (Synchrony bank CD, October 3, 2026) | about 5.50% to 6.05% (A-rated, October 14, 2026) |
| Tax treatment inside IRA | Deferred | Deferred (identical) |
| Insurance / guaranty | FDIC $250K per depositor per bank | State guaranty fund, typically $250K-$300K per owner per carrier; backed by carrier balance sheet |
| Early access | Pay 90-365 days interest, get principal back | 10% free withdrawal annually most carriers; surrender charge on excess |
| Rate lock-in length | 3 months to 5 years typical | 3 to 10 years; 5-year is most common |
Worked example: $100,000 IRA money for 5 years:
The MYGA rate is guaranteed by the issuing insurer and backed by its claims-paying ability, not the FDIC. The rate gap exists largely because insurers invest in longer-duration bonds. Inside an IRA, where you cannot spend the principal until 59½ without penalty anyway, locking up for the full term costs you nothing extra. The MYGA is a better fit for IRA money the same way it is for taxable money, with one added point: the tax-deferred wrapper is "redundant" inside an IRA, but that does not make the MYGA worse. It just means you are buying an insurance product purely on rate, not on tax shelter. And on rate, it usually wins.
See IRA CD vs MYGA decision guide and current best MYGA rates.
Under SECURE Act 2.0, Required Minimum Distributions (RMDs) begin at age 73 for Traditional IRA holders (and SEP/SIMPLE IRA holders). Roth IRAs have no RMD during the original owner's lifetime. For an IRA CD, the practical issue is liquidity: if your full IRA balance is locked in a single 5-year CD, you may need to break the CD to take your RMD. Two solutions:
Vanguard's IRA brokered CD platform is competent but not the leader. Use it if your IRA assets are already at Vanguard and the consolidation benefit outweighs the marginal platform-depth advantage of Fidelity or Schwab. For 5-year IRA money, an A-rated IRA MYGA still pays meaningfully more than even the best Vanguard 5-year brokered CD in the same tax wrapper.
Yes. FDIC protection applies at the issuing bank, up to $250,000 per depositor per bank per ownership category. Vanguard is the broker, not the issuer, and you are responsible for tracking what you hold at each bank.
$1,000, in $1,000 increments (investor.vanguard.com, October 3, 2026).
No commission on new-issue CDs. Secondary-market purchases are charged a commission, sales of existing positions are commission-free, and phone-placed secondary trades add a $25 broker-assisted fee (Vanguard, October 3, 2026).
Yes, on the secondary market. There is no bank penalty, but the price reflects current rates: a gain if rates fell, a loss if rates rose.
Yes. They work like any other inherited IRA asset, subject to the SECURE Act 10-year rule for most non-spouse beneficiaries.
Compare rates on the same day. On the dated figures here, a 5-year bank CD paid 4.50% (October 3, 2026) and A-rated 5-year MYGAs about 5.50% to 6.05% (October 14, 2026), about $6,100 more on $100,000 over five years. Inside an IRA both grow tax-deferred; the MYGA has surrender charges and is backed by the insurer, not the FDIC.
This review is based on the carrier's public product materials and rates as of the date shown above. CD rates, IRA account fees, MYGA crediting rates, and IRS rules cited (RMD age 73 under SECURE 2.0, 10% early withdrawal penalty before 59½, Roth 5-year qualified distribution rule, post-2019 SECURE Act 10-year rule for non-spouse inherited IRA beneficiaries) are current as of the publication date and subject to change. Always confirm current rates with the issuer and current tax law with a CPA before opening, rolling over, or withdrawing from any IRA. This article is general information for educational purposes; it is not a personalized recommendation, tax opinion, legal opinion, or offer of any specific product. Hans Goldstein is an independent licensed insurance producer (NPN 20602398) appointed with multiple A-rated annuity carriers; he does not sell bank CDs and is not affiliated with any bank, credit union, or brokerage discussed in any review on this site. No compensation has been received from any bank, credit union, or brokerage in connection with this review. MYGAs are insurance products with surrender charges; bank CDs are FDIC-insured deposit products; credit union CDs are NCUA-insured share certificates. These are different product categories with different protections and trade-offs.
Hans Goldstein is an Enrolled Agent, admitted to practice before the Internal Revenue Service. Not affiliated with or endorsed by the IRS. General education, not tax or legal advice for your situation.