- You can earn up to 4.70% APY with today’s best CDs.
- The Fed cut rates for the third time yesterday, which means the downward trend in APY is likely to continue.
- The sooner you open the CD, the higher rate you will be able to lock in.
tomorrow, the Federal Reserve cuts interest rates By 25 basis points, as most experts expected it to do. This is the third time the Fed has cut rates this year, and after the last two rate cuts, we saw deposit rates drop significantly.
you can still find top cd Earnings up to 4.70% – more than double National average Rates for certain conditions. But with this latest rate cut and more expected for 2025, now is the time to lock in your APY. If you wait too long, chances are you won’t get such good rates.
Here are some of the highest CD rates right now and how much you could make by depositing $5,000.
Today’s Best CD Rates
| Duration | Highest APY* | Edge | Estimated Earnings |
|---|---|---|---|
| 6 months | 4.70% | emerging 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 rates from CNET’s partners for your area.
Why are CD rates likely to fall after the Fed’s latest move?
The last meeting of the Fed will be held on December 17 and 18 this year. Although it does not directly set CD rates, the Fed’s decisions influence how banks set their APYs on CDs and consumer products. savings accountsWhen the Fed cuts the federal funds rate, banks cut the APY on these products, and vice versa.
The Fed raised interest rates 11 times between March 2022 and July 2023 in an effort to reduce inflation after the pandemic. As a result, CD rates we track at CNET rose to an all-time high of 5.65% APY. But CD and savings rates have been slowly declining since the beginning of this year.
Fed Rate cut in September – This is the first rate cut since March 2020 – and again novemberSince then, CD and savings rates have declined rapidly. As of early 2024, the average APY on a six-month CD was 4.92%, but after the September rate cut, it dropped to 4.38%. This week it is 4.14%. We are likely to see additional downside as a result of tomorrow’s rate cut.
CD rates at the beginning of this week compared to the beginning of last week were as follows:
How CD Rates Have Changed Last Week
| Duration | Last week’s CNET average APY | This week’s CNET average APY** | Weekly Changes*** |
|---|---|---|---|
| 6 months | 4.14% | 4.15% | 0.0024 |
| 1 year | 4.07% | 4.08% | 0.24 |
| 3 years | 3.52% | 3.52% | no change |
| 5 years | 3.46% | 3.46% | no change |
Why is now the time to open the CD?
If you’re working on growing your savings, there’s still time to earn attractive APY. If you already have money saved that you won’t need to invest for a few years, you can lock in high, guaranteed returns with a CD now.
“CDs are a good, stable way to get predictable returns while controlling the amount of time you don’t have access to your money,” says Bobby Rebel, Certified Financial Planner® and personal finance expert. BadCredit.org“Rates are still high on a historical basis.”
Additionally, “locking the CD rate could be beneficial if the Fed takes a more aggressive stance on cutting rates in 2025,” said Faron Dougs, founder and CEO of CFP. Harrison Wallace Financial Group.
If you need instant access to your money, you can also earn competitive rates High-Yield Savings AccountHYSAs are better suited for things like yours emergency fund Because you can withdraw cash anytime without any penalty.
what to look for in 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:
- When you will need your money: penalty for early withdrawal Can put a dent in your interest income. So make sure to choose a term that suits your savings timeline. Alternatively, you can select a no-penalty cdHowever the APY may not be as high as you would get from a traditional CD of the same duration.
- Minimum Deposit Requirement: Some CDs require a minimum amount to open an account – typically, $500 to $1,000. Others don’t. Knowing how much money you have to set aside can help you narrow down your options.
- charge: Maintenance and other charges can eat into your earnings. many online bank Do not charge fees as their overhead costs are lower than banks with physical branches. Still, read the details of any account you’re evaluating.
- Federal Deposit Insurance: ensure that any bank or credit union You are considering being an FDIC or NCUA member, so your money is safe If the bank fails,
- Customer Ratings & 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.
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 offering, accessibility and customer service.
Current banks included in CNET’s weekly CD average include Alliant Credit Union, Ally Bank, American Express National Bank, Barclays, Basque Bank, Bradt Savings, Capital One, CFG Bank, CIT, Fulbright, Marcus by Goldman Sachs, MYSB Direct, Quantic Are. Rising Bank, Synchrony, EverBank, Popular Bank, First Internet Bank of Indiana, First Federal Credit Union of America, 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 APY and interest is assumed to be compounded annually.
**Weekly percentage increase/decrease from December 9, 2024 to December 16, 2024.
