- You can earn up to 4.75% APY with high-yield CDs.
- CD APYs have been falling throughout the year and may fall again in December if the Federal Reserve cuts interest rates.
- By securing a high APY now, you can protect your money from further interest rate cuts.
Certificates of deposit have offered very high interest rates on your savings over the years. Now that interest rates are back to the Fed’s 2% target and central banks are starting to cut interest rates, CD rates are falling as well. With another rate cut scheduled for December, CD rates could fall even lower.
If you’ve been considering opening a certificate of deposit, locking in a high interest rate now can help you earn a competitive return on your savings. Today’s best CDs offer annual returns of up to 4.75%. This is more than twice the national average for some periods. Securing a high CD interest rate now can help protect your profits from interest rate declines in the future.
You’ll find the best APY at your credit union. Here’s the highest interest rates, based on the banks CNET tracks, and how much you can get if you deposit $5,000 today.
Today’s best CD prices
| terminology | Highest APY* | bank | expected income |
|---|---|---|---|
| 6 months | 4.75% | Community Wide Federal Credit Union | $117.37 |
| 1 year | 4.50% | Community Wide Federal Credit Union | $225.00 |
| 3 years | 4.15% | America First Credit Union | $648.69 |
| 5 years | 4.25% | America’s First Credit Union | $1,156.73 |
Experts recommend comparing rates before opening a CD account to get the best APY possible. Enter your information below to get the best rates from CNET partners in your area.
Will CD rates drop in December?
All eyes are on the Federal Reserve to see where interest rates will go next. The Fed could make another rate cut in December, which would push the CD dip even lower.
The Federal Reserve does not directly influence CD rates, but it does control the federal funds rate. The federal funds rate is the overnight lending rate that banks charge each other when they borrow money. When the federal funds rate falls, interest rates on consumer goods such as CD and savings account rates tend to follow.
The Federal Reserve’s post-pandemic mandate to raise interest rates has pushed interest rates to record highs and CD rates soaring above 5% APY. Since the beginning of this year, the CD ratio and savings rate have been gradually decreasing. CD rates and savings rates began falling faster after the Federal Reserve cut rates for the first time since the pandemic last September.
The Federal Reserve has cut interest rates twice this year, but Chairman Jerome Powell noted earlier this month that the pace of rate cuts has been slow. Experts are therefore torn as to whether the Federal Reserve will cut interest rates or keep them unchanged at its December 17-18 meeting.
Bobbi Rebell, CFP® and personal finance expert at BadCredit.org, said she thinks a rate cut is likely, but “isn’t ruling out a pause due to ongoing concerns about inflation and the perception that the economy isn’t that weak.” Just as many people believed.”
What do current CD rates mean to you?
If you’re working to increase your savings, there’s still time to earn a high APY. If you already have enough money saved that you won’t need to invest for several years, you can secure high returns with a CD now.
CD rates are likely to fall even if further interest rate cuts are imminent, but they will not plummet overnight. You can earn higher returns by securing a CD sooner, but you can also earn competitive rates by growing your savings with a high-yield savings account.
Here are CD rates at the beginning of this week compared to the beginning of last week:
How CD rates changed last week
| terminology | CNET Average APY Last Week | CNET Average APY This Week* | Weekly changes* |
|---|---|---|---|
| 6 months | 4.21% | 4.18% | -0.71% |
| 1 year | 4.09% | 4.11% | +0.49% |
| 3 years | 3.55% | 3.55% | no change |
| 5 years | 3.48% | 3.49% | +0.29% |
How to choose the right CD
Competitive APY is important when comparing CD accounts, but it’s not the only thing you should look at. To find the account that’s right for you, also consider the following:
- When you need money: Early withdrawal penalties may affect your interest earnings. So choose a term that fits your savings schedule. Alternatively, you can choose a penalty-free CD, but the APY may not be as high as a traditional CD of the same terms.
- Minimum deposit requirements: Some CDs require a minimum deposit (usually $500 to $1,000) to open an account. Others don’t. It can help you narrow down your options on how much money you need to save.
- charge: Maintenance and other costs can affect your income. Many online banks don’t charge fees because they have lower overhead than banks with physical branches. Still, read the details of the account you’re evaluating.
- Federal Deposit Insurance: Make sure the bank or credit union you’re considering is a member FDIC or NCUA to protect your money if the bank goes bankrupt.
- Customer Ratings & Reviews: Visit sites like Trustpilot to see what customers are saying about their bank. You want a bank that is fast, professional, and easy to work with.
methodology
CNET reviews CD rates based on the latest APY information from issuer websites. We evaluated CD rates from over 50 banks, credit unions, and finance companies. We evaluate CDs based on APY, product offerings, accessibility, and customer service.
Current banks included in CNET’s weekly CD averages include Alliant Credit Union, Ally Bank, American Express National Bank, Barclays, Bask Bank, Bread Savings, Capital One, CFG Bank, CIT, Fulbright, Marcus by Goldman Sachs, MYSB Direct, and Quontic. , Rising Bank, Synchrony, EverBank, Popular Bank, Indiana’s first Internet Banks (First Internet Bank of Indiana, America First Federal Credit Union, CommunityWide Federal Credit Union, Discover, Bethpage, BMO Alto, Limelight) Bank, First National Bank of America and Connexus Credit Union.
*APY as of December 1, 2024, based on banks tracked by CNET. Earnings are based on APY and assume interest is compounded annually. Weekly percentage increase/decrease from November 25, 2024 to November 29, 2024.
