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When rates are falling, the sooner you open a CD, the more you stand to earn.
Kelly is an editor for CNET Money covering banking. She has over 10 years of experience in personal finance and previously wrote for CBS MoneyWatch covering banking, investing, insurance and home equity products. She is passionate about arming consumers with the tools they need to take control of their financial lives. In her free time, she enjoys binging podcasts, scouring thrift stores for unique home décor and spoiling the heck out of her dogs.
Key Takeaways
- You can earn up to 4.70% APY with today’s top CDs.
- APYs are falling and likely to keep falling in the coming months.
- The sooner you open a CD, the higher the rate you could lock in and the greater your earning potential could be.
Timing is important when it comes to how much you can earn with a certificate of deposit. Your annual percentage yield, or APY, is locked in when you open a CD, which means your returns stay the same regardless of where rates go in the future. And in today’s falling-rate environment, the time to act is now.
The best CDs currently offer up to 4.70% APY — more than twice the national average for some terms. But APYs have been falling after the Federal Reserve cut interest rates at its last three meetings, and experts expect this trend to continue into the new year. So, by locking in an APY now, you can maximize your earning potential.
Here are some of the highest CD rates right now and how much you could earn by depositing $5,000.
Today’s best CD rates
| Term | Highest APY* | Bank | Estimated earnings |
|---|---|---|---|
| 6 months | 4.70% | Rising Bank | $117.50 |
| 1 year | 4.50% | Limelight Bank | $225.00 |
| 3 years | 4.15% | America First Credit Union | $648.69 |
| 5 years | 4.25% | America 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 CNET’s partners’ best rate for your area.
Why you shouldn’t wait to open a CD
Although the days of sky-high CD rates may be over, it’s still smart to lock in a high APY with one of today’s top accounts.
The Fed’s actions play a key part in where banks set their CD and savings account APYs. When the Fed raises the federal funds rate, banks tend to raise APYs on these accounts. When it cuts the federal funds rate, banks cut their APYs.
In recent years, the Fed hiked rates 11 times to fight record inflation, and CD rates soared, reaching 5.65% APY for the banks we track at CNET. Since the Fed started cutting its benchmark interest rate in the fall, savings rates have come down considerably.
CDs offer the ability to lock in a fixed rate for a specified term, so your APY won’t drop even if the Fed continues to lower interest rates. Locking in a high APY now can protect your earnings from additional fluctuations among banks. Today’s top APY of 4.70% is still more than double the national average for some terms.
How CD rates have changed in the last week
| Term | Last week’s CNET average APY | This week’s CNET average APY** | Weekly change*** |
|---|---|---|---|
| 6 months | 4.09% | 4.09% | 0.0% |
| 1 year | 4.03% | 4.03% | 0.0% |
| 3 years | 3.50% | 3.50% | 0.0% |
| 5 years | 3.45% | 3.45% | 0.0% |
Look at these things when choosing a CD
A competitive APY is important when comparing CD accounts, but it’s not the only thing you should look at. To find the right account for you, consider these things, too:
- When you’ll need your money: Early withdrawal penalties can eat into your interest earnings. So be sure to choose a term that fits your savings timeline. Alternatively, you can select a no-penalty CD, although the APY may not be as high as you’d get with a traditional CD of the same term.
- Minimum deposit requirement: Some CDs require a minimum amount to open an account — typically, $500 to $1,000. Others do not. How much money you have to set aside can help you narrow your options.
- Fees: Maintenance and other fees can eat into your earnings. Many online banks don’t charge 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 bank or credit union you’re considering is an FDIC or NCUA member so your money is protected if the bank fails.
- Customer ratings and reviews: Visit sites like Trustpilot to see what customers are saying about the bank. You want a bank that’s 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 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, 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 and Connexus Credit Union.
*APYs as of Dec. 30, 2024, based on the banks we track at CNET. Earnings are based on APYs and assume interest is compounded annually.
**Weekly percentage increase/decrease from Dec. 23, 2024, to Dec. 30, 2024.
