Key takeaways
- You can lock in a high CD rate of up to 5.35% APY
- The Federal Reserve is expected to cut rates later this year, so today’s APYs are likely the best you’ll get all year.
- Locking in a high rate now can help you earn more if rates drop in the future.
Interest rates for certificates of deposit have been slowly inching down from their record highs in 2023 -- but they’re still attractive.
Today’s top CDs offer annual percentage yields, or APYs, as high as 5.35%, based on the banks we track at CNET. That’s more than three times the national average for some terms. What we like most about investing in a CD is that you lock in your APY when you open an account, which can protect your earnings from future rate drops.
“CD rates have held up nicely,” said Faron Daugs, CFP, founder and CEO at Harrison Wallace Financial Group. “[Today’s] rates allow an investor to collect reasonable interest with dollars that might otherwise be idly sitting in low-interest savings accounts.”
Experts recommend comparing rates before opening a CD account to get the best APY possible. Enter your information below to get CNET’s partners’ best rate for your area.
Today’s best CD rates
Here are some of the top CD rates available right now and how much you could earn by depositing $5,000 right now:
Term | Highest APY | Bank | Estimated earnings |
6 months | 5.31% | Rising Bank | $131.03 |
1 year | 5.35% | NexBank | $267.50 |
3 years | 4.66% | First Internet Bank of Indiana | $732.08 |
5 years | 4.55% | First Internet Bank of Indiana; First National Bank of America | $1,245.83 |
CD rates are on the way down
CD rates are influenced by the federal funds rate, which determines how much it costs banks to borrow and lend money to each other. The Federal Reserve regularly adjusts this rate to stimulate the economy and keep inflation in check. When the federal funds rate goes up, banks tend to raise their rates on consumer products like savings accounts and CDs to boost their cash reserves.
From March 2022 to July 2023, the Fed raised the federal funds rate to combat rampant inflation -- and CD rates followed suit. But the central bank has paused rates at its last five meetings, and experts expect it will begin cutting rates later this year. As a result, CD rates have been steadily declining.
CD rates may fluctuate for other reasons as well. For example, banks might boost rates to remain competitive and attract new customers.
Here’s where rates stand compared to last week:
Term | CNET average APY | Weekly change* | Average FDIC rate |
6 months | 4.79% | -1.64% | 1.52% |
1 year | 4.98% | No change | 1.81% |
3 years | 4.08% | No change | 1.38% |
5 years | 3.94% | -0.25% | 1.38% |
*Weekly percentage increase/decrease from April 1, 2024, to April 8, 2024.
With APYs on the downward trend, the sooner you open an account, the higher the rate you can lock in -- and the more interest you’ll earn.
“If you have a time frame that equals the term of the CD, lock in these higher rates now, as I do see rates starting to decline in the next six months,” Daugs said.
Why you shouldn’t wait to open a CD
With rates as high as they’re expected to go, now’s the time to open a CD and lock in a high APY. But that’s not the only reason to open an account today. CDs offer attractive benefits in any rate environment.
CDs are insured up to $250,000 per person, per bank, as long as the bank is insured by the Federal Deposit Insurance Corporation. Credit unions offer the same protection through the National Credit Union Administration. That means your money is safe up to the deposit limits if the bank fails.
Plus, unlike investments such as stocks, CDs are low-risk. You won’t lose your principal deposit unless you run into early withdrawal penalties, which you can easily avoid by choosing the right term.
Factors to consider when choosing a CD account
In addition to a competitive APY, here’s what you should consider when comparing CD accounts:
- How soon you’ll need your money: Early withdrawal penalties can chip away at your interest earnings. So, be sure to choose a term that fits your savings timeline. You should be comfortable leaving your money untouched for the entire term.
- Minimum deposit requirement: Some CDs require a certain amount to open an account -- typically, $500 to $1,000. Others don’t. How much money you have to set aside can help you narrow down the right account for you.
- Fees: Fees can eat into your earnings. Many online banks don’t charge maintenance fees because they have lower overhead costs than banks with physical branches. Still, read the fine print for any account you’re evaluating.
- Federal deposit insurance: Make sure any institution you’re considering is an FDIC or NCUA member so your money is protected if the bank fails.
- Customer ratings and reviews: Check out sites like Trustpilot to see what customers are saying about any bank you’re considering. You want to know that the bank is responsive, 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 more than 50 banks, credit unions and financial companies. We evaluate CDs based on APYs, product offerings, accessibility and customer service.
The current banks included in CNET’s weekly CD averages are: 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, Quontic, Rising Bank, Synchrony, EverBank, Popular Bank, 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, Connexus Credit Union.