Rates for certificate of deposits (CDs) and savings accounts are still reaping the benefits of multiple Federal Reserve rate hikes. Some banks are pushing rates past 5.00% APY, giving you a bigger return on your hard-earned cash.
The high interest rates are a win-win for savers since CDs and high-yield savings accounts are good low-risk options backed by FDIC or NCUA insurance. But with short-term CDs tipping over 5.00% APY and savings accounts inching closer, the best place for your savings boils down to your goals.
Either way, with rates this high, if you aren’t earning interest on your savings, now’s the time to start. And with experts predicting that the Fed won’t raise rates at its next meeting this month, this may be as good as savings and CD rates get. Rates could even start to slowly dip in the coming months -- so there may not be much time left to take advantage of rates this high.
For now, here are some of the best CD and savings rates this week, and banks offering over 5.00% APY this week.
Many short-term CDs reached 5.00% APY and beyond
Many CD rates remained the same this week across banks we track at CNET -- with many short-term CDs staying around 5.00%. However, some banks are currently offering rates over 5.00%, such as Bask Bank’s six-month CD at 5.10% APY. MYSB Direct was one of the few that increased rates last week, bringing its six-month and one-year CDs up to 5.10% and 5.20%, respectively. However, Barclays Bank lowered its CD rates for one- and two-year terms -- 4.80% and 4.40%, respectively.
Savings accounts remained the same, but some topped 5.00% APY
Most banks that we track kept high-yield savings rates the same this week. However, My Banking Direct stands out for pushing its savings account up to 5.00% APY. The increase helped boost the average high-yield savings rate for banks we track at CNET from 4.45% to 4.51% APY.
Banks offering 5.00% APY or more on high-yield savings accounts and CDs
Whether you’re looking for a new savings account or CD to park your money for a future savings goal, here are some of the banks offering the best return on your savings right now.
Here are a few high-yield savings accounts offering APYs at 5.00% or close to it:
- My Banking Direct: 5.00%
- Newtek Bank: 5.00%
- UFB Direct: 4.81%
Note: To earn this high an APY, you may have to meet certain requirement deposits or may only earn the highest APY on a portion of your balance. Additionally, the highest APYs are usually offered at online-only banks, which means you’ll need to be comfortable managing your account and other banking services online.
Read more: Earn 5% APY (or Close to It) With These High-Yield Savings Accounts
Right now, long-term CD rates aren’t nearly as high as short-term CD rates -- which are over 5.00% APY for many banks. More CDs pushed rates past 5.00% this week, including MYSB Direct and Quontic Bank -- but only for six-month and one-year CDs. Most banks are reserving their highest rates for CD terms of two years or less. Here’s a rundown:
|Bank||Term and APY|
|Alliant||1 year (5.00%), 18 months (5.15%)|
|Barclays||6 months (5.10%), 1 year (5.00%)|
|Bask Bank||6 months (5.10%), 1 year (5.00%)|
|Bread Savings||1 year (5.20%), 2 year (5.00%)|
|CFG Bank||1 year (5.28%), 18 months (5.25%)|
|CIT Bank||6 months (5.00%)|
|Forbright||1 year (5.20%)|
|MYSB Direct||6 months (5.10%), 1 year (5.20%)|
|Rising Bank||6 months (5.00%), 1 year (5.15%)|
|Quontic||6 months (5.05%), 1 year (5.15%)|
|Synchrony||6 months (5.00%), 1 year (5.15%)|
|TIAA Bank||9 months (5.00%)|
How to decide whether CDs or high-yield savings are best for you
With short-term CDs over 5.00% and variable savings rates steadily increasing, choosing between the two savings vehicles may not be easy. It all boils down to when you’ll need the money and your goal for the funds.
“What are you trying to accomplish with the money that is in question?” said Ravin Walters, a certified financial planner at Transverse Wealth Solutions. “If the answer is for emergencies, a fully liquid and accessible high-yield savings account would be the most suitable option.” Aside from your emergency fund, any excess cash you plan to use in a few years can go into a CD that matures right before the expected date you’ll need the money.
When it comes to shorter-term CDs, you’ll need to do some math to determine whether a high-yield savings account or CD is best. However, since high-yield savings accounts have a variable APY, you may lock in a short-term CD to ensure a guaranteed rate if rates drop over the next few months. But remember that, if you need to withdraw the funds before the CD matures, you’ll pay an early withdrawal penalty -- which can eat away at your interest earnings.