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Key Takeaways
- Today’s highest CD rate is 5.40% for a 6-month CD.
- CD rates from online banks are commonly twice as high as the national average rates.
- CD ladders let you leverage high rates without locking up all of your money long-term.
The best interest rates on CDs (certificates of deposit) currently top out at 5.40%, depending on the term. Here’s a look at how CD rates are trending, along with an overview of the best rates for several different terms.
Related: Compare the Best CD Rates
Highest CD Rates Today
| CD Rates Today | ||
|---|---|---|
Term | Highest APY | Average APY |
3 Months | 5.39% | 1.26% |
6 Months | 5.40% | 1.80% |
1-Year CD (12 M) | 5.37% | 1.96% |
2-Year CD (24 M) | 5.00% | 1.71% |
3-Year CD (36 M) | 4.75% | 1.62% |
5-Year CD (60 M) | 4.60% | 1.61% |
Jumbo CD | 5.40% | 1.71% |
Source: Curinos. Rates are based on a $25,000 minimum deposit. Data accurate as of May 23, 2024.
A CD is a type of savings account that pays a fixed interest rate for a fixed amount of time. When you open a CD account, you agree not to touch your deposit until the CD’s term ends. That could be in six months, one year or five years, depending on the term you’ve chosen. If you follow through, you’ll be rewarded with an amount of interest that’s typically greater than what you’d earn from a standard savings account.
If you withdraw money from your CD account before it “matures” (when it reaches the end of its term), you’ll likely face stiff penalties that may negate some or all of the interest you’d earn. For instance, you could sacrifice up to six months’ worth of interest if you withdraw funds from a one-year CD before it matures.
If you’re looking to earn as much interest as possible, consider opening a longer-term CD. These CDs generally offer the highest interest rates, but they require you to stash your cash for several years.
Early withdrawal penalties typically scale according to the length of the CD term. That means you could lose an entire year’s worth of interest if you withdraw funds from a five-year CD before its maturity. That’s why it’s critical to research any potential penalties prior to making your investment.
Today’s 3-Month CD Rates
For short-term savings goals, three-month CDs might make sense. The current average rate on a three-month CD sits at 1.26%, but the highest rate is 5.39%. Last week, three-month CDs were earning 1.26% on average.
Today’s 6-Month CD Rates
If you’re interested in a shorter-term CD, today’s best six-month CD rate is 5.40%. That compares with 5.40% a week ago. The current average APY for a six-month CD is 1.80%, compared to 1.79% last week at this time.
APY provides a more accurate depiction of the yearly interest you’ll earn with a CD because it factors in compound interest. That’s the interest you earn not only on your deposit (or principal) but also on the interest itself.
Today’s 1-Year CD Rates
The highest interest rate currently being offered on a 12-month CD—one of the most popular CD terms—is 5.37%. If you find a one-year CD with a rate in that vicinity, you’re getting a good deal. One week ago, the best rate was the same.
The average APY, or annual percentage yield, on a one-year CD is now 1.96%, up from 1.95% a week ago.
Today’s 2-Year CD Rates
If you can hold out for two years, 24-month CDs today are being offered at interest rates as high as 5.00%. The top rate last week at this time was a similar 5.00%. Two-year CDs now have an average APY of 1.71%, an increase from 1.70% last week.
Today’s 3-Year CD Rates
CDs with longer terms tend to have some of the most attractive interest rates and APYs—if you’re willing to keep your money locked away for years.
Within the last week, the highest rate on a three-year CD has been 4.75%, so you’ll want to shop around for that rate or something near it.
Today’s 5-Year CD Rates
On a five-year CD, the highest rate today is 4.60%. APYs are averaging 1.61%, the same as this time last week.
The longer the term, the harsher the early withdrawal penalty. It’s not unusual to lose one full year’s worth of interest or more if you break open a five-year CD too soon. Be absolutely certain you understand the penalty before you make your investment.
Today’s Jumbo CD Rates
The best rate on today’s jumbo CDs is 5.40% for a 6-month term. The average APY for this category of CD is currently 1.71%, compared to 1.71% last week.
Most jumbo CDs require a minimum deposit of $100,000—and some even require $250,000. However, there’s no universally agreed-upon definition regarding what qualifies as a “jumbo” CD. Some banks and credit unions slap the label “jumbo” on CDs you can open with $50,000, $25,000 or even less.
Other Top CD Rates By Term
- Best 4-Year CD Rates
- Best 10-Year CD Rates
- Best 18-Month CD Rates
- Best Jumbo CD Rates
- Best IRA CD Rates
- Best No-Penalty CD Rates
Related: CD Interest Rates Forecast: How Good Will They Get?
How To Open a CD
You “purchase” a CD from a financial institution by opening an account with a lump-sum deposit, which becomes the CD’s principal. CDs and share certificates (the credit union equivalent of bank CDs) often require that you make a minimum deposit. Minimum requirements vary by institution and range from a dollar to tens of thousands of dollars. Some institutions don’t require a minimum at all.
Once you deposit your principal, you start the clock on your timed investment and begin earning interest. The bank or credit union will provide you with regular statements showing how much interest you’re accruing. You may accrue interest daily, monthly or quarterly.
Remember, avoid the temptation of tapping into your CD before the term ends. Early withdrawal penalties can be so severe that they can not only take back your interest and then, but also start eating into your principal..
Build a CD Ladder
Want to earn higher yield, but wary of keeping your money chained up for years? A CD ladder can help you earn good returns and make your investment feel more liquid.
You build a ladder by investing your money in multiple CDs with terms of different lengths. You might buy a one-year CD, a two-year CD, a three-year CD, a four-year CD and a five-year CD. As each of the shorter-term CDs matures, you replace it with a new five-year CD.
Follow this plan, and in a few years you’ll have one better-yielding five-year CD maturing each year. If you’re ever having a bad year, you could take some of the cash from the expiring CD and use it to pay bills instead of pouring it all into a fresh CD.
You’ve got to comparison shop to track down the best CD rates. Banks and credit unions compete by offering alluring yields to land your business, so shopping around is a must before you purchase any bank CD or credit union share certificate.
Methodology
Curinos determines the average rates for certificates of deposit (CDs) by focusing on specific CDs and excluding others. Certain types, such as promotional offers, relationship-based rates, private, youth, senior, student/minor, affinity, bump-up, no-penalty, callable, variable, step-up, auto transfer, club, gifts, grandfathered, internet-only and IRA CDs are not considered in the calculation.
