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- The best CDs today offer up to 4.70% APY.
- An expected Fed rate cut tomorrow means APYs are likely to continue to fall.
- Opening a CD today allows you to protect your income from rate cuts.
Certificate of deposit rates remain attractive despite falling in recent months. They are likely to continue to fall in the coming months, especially if the Federal Reserve interest deduction tomorrow as expected. So, the faster you open a CD, the more you will earn.
Your annual percentage yield is set when you open a CD. That means your returns will stay the same even if prices fall. By opening one in the present top CDsyou can lock in an APY of up to 4.70% and protect your income from further rate drops.
Here are some of the highest CD rates today and how much you can make by depositing $5,000.
The best CD rates today
| TERMS | Maximum APY* | bank | Estimated income |
|---|---|---|---|
| 6 months | 4.70% | Raised Bank | $117.50 |
| 1 year | 4.47% | NexBank | $223.50 |
| 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 possible APY. Enter your information below to get the best CNET partner rates for your area.
What tomorrow’s Fed decision means for CD rates
The Fed meets for the last time this year on December 17-18. It doesn’t directly set CD rates, the Fed’s decisions affect how banks set their APYs on consumer products like CDs and savings accounts. When the Fed cuts the federal funds rate, banks tend to cut APYs on these products, and vice versa.
The Fed raised interest rates 11 times between March 2022 and July 2023 in an effort to bring down post-pandemic inflation. As a result, the CD rates we track at CNET have soared, reaching as high as 5.65% APY. Since the beginning of this year, the amount of CD and savings has been slowly decreasing.
The swineherd reduce rates in September — the first rate cut since March 2020 — and again in noVeMber. Since then, CD and savings rates have fallen even faster. At the start of 2024, the average APY on a six-month CD was 4.92%, but after the rate cut in September, it dropped to 4.38%. This week, it is 4.14%.
Here’s where CD rates stand at the start of this week compared to the start of last week:
How have CD rates changed over the past week
| TERMS | The CNET average APY last week | This week’s CNET average APY** | Weekly change*** |
|---|---|---|---|
| 6 months | 4.14% | 4.15% | $0.00 |
| 1 year | 4.07% | 4.08% | $0.24 |
| 3 years | 3.52% | 3.52% | There is no change |
| 5 years | 3.46% | 3.46% | There is no change |
CD rates could drop further if the Fed makes another rate cut this week. Now, experts say it’s likely the Fed will cut rates again this month despite the latest Consumer Price Index Report shows that inflation is still rising.
Why don’t you wait to open a CD
If you’re working to grow your savings, there’s still time to earn an attractive APY. If you already have money saved up that you won’t need to dip into for a few years, you can lock in a high, guaranteed return with a CD today.
“CDs are a great, consistent way to earn a predictable return while controlling the amount of time you don’t have access to your money,” says Bobbi Rebell, Certified Financial Planner® and Personal Finance Expert with BadCredit.org. “Prices are still high on a historical basis.”
Additionally, “Locking in a CD rate now could be beneficial if the Fed takes a more aggressive approach to cutting rates in 2025,” said Faron Daugs, CFP, founder and CEO of Harrison Wallace Financial Group.
If you need ready access to your money, you can also get a competitive rate with a high yield savings account. HYSAs are better suited for things like yours emergency fund because you can withdraw money at any time without penalty.
Things to consider 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, also consider these things:
- If you need your money: Early withdrawal penalties can eat into your interest income. So be sure to choose a term that fits your savings timeline. Alternatively, you can choose a CD without penaltyalthough the APY may not be as high as you would get on a traditional CD over the same term.
- Minimum deposit requirement: Some CDs require a minimum amount to open an account – typically, $500 to $1,000. Some don’t. How much money you have to spare will help you narrow down your options.
- Fee: Maintenance and other fees can eat into your income. many online banks do not charge fees as overhead costs are lower than banks with physical branches. However, read the fine print for any account you are evaluating.
- Federal deposit insurance: Make sure any bank or credit union you consider becoming a member of the FDIC or NCUA to protect your money 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 is responsive, professional and easy to work with.
procedures
CNET checked CD rates based on the latest APY information from issuer websites. We review CD rates from more than 50 banks, credit unions and financial companies. We evaluate CDs based on APYs, product offerings, accessibility and customer service.
Current banks included in CNET’s weekly CD average 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 December 18, 2024, based on banks we track at CNET. Earnings are based on APYs and assume interest is compounded annually.
**Weekly percentage increase/decrease from December 9, 2024, to December 16, 2024.
