CD rates are still holding high in the new year. Banks with the top CDs are offering annual percentage yields, or APYs, of up to 5.55%. But some banks are slowly lowering rates for select terms — a clear sign that savers need to act quickly if they plan to open a CD, especially for the long term.
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Opening a CD now will allow you to secure a high rate while they’re still around. If rates continue to fall, your APY is locked in, so your interest earnings will stay the same.
If you’ve been wanting to open a CD, you may want to act fast before your earning potential drops.
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 currently available and how much you could earn if you deposited $5,000 right now:
CD rates aren’t seeing big changes
CD rates rose steadily over the past two years in response to the Federal Reserve regularly raising the federal funds rate. This rate affects how much it costs banks to borrow and lend money to each other. So, when the Fed raises the federal funds rate, banks often follow suit, raising interest rates on consumer products like credit cards, loans and savings products to attract more customers and boost their cash reserves.
With inflation inching closer to the Fed’s 2% target, the last three FOMC meetings resulted in rate hike pauses. In response, banks have begun dropping their rates across CD terms, and some banks have held rates steady for weeks. Here’s where APYs stand compared to last week:
| Term | CNET average APY* | Weekly change** | Average FDIC rate |
| 6 months | 4.92% | No change | 1.49% |
| 1 year | 5.21% | No change | 1.86% |
| 3 years | 4.26% | -0.24% | 1.41% |
| 5 years | 4.03% | -0.25% | 1.40% |
**Percentage increase/decrease from Jan. 2, 2024, to Jan. 8, 2024.
This may not seem like a drastic decrease overall, but when we look at individual CD rates over the past month, we see that earning potential has decreased more markedly. Here’s how top CD rates compare from the beginning of December 2023 to the beginning of January 2024:
| Term | Highest APY on Dec. 4, 2023 | Highest APY on Jan. 3, 2024 | Monthly Change |
| 6 months | 5.55% | 5.50% | -0.90% |
| 1 year | 5.75% | 5.55% | -3.48% |
| 3 years | 5.10% | 4.85% | -4.90% |
| 5 years | 5.25% | 4.75% | -9.52% |
CD interest is compounded, which means you earn interest not only on your principal balance but also on the interest you’ve earned to date. So, even a small decrease in APY can make a big difference over time when it comes to how much money you can earn. With rates dropping across the board, the longer you wait to open a CD, the more you stand to lose.
Advantages of opening a CD while rates are still high
The best way to protect yourself from anticipated future rate drops is to lock in a great APY now. But a fixed rate of return isn’t the only perk of opening a CD now.
CDs held by FDIC-insured banks or NCUA-insured credit unions are protected by federal deposit insurance up to $250,000 per person, per institution if the bank fails. This makes them a low-risk way to grow your savings. Plus, early withdrawal penalties can discourage you from dipping into your funds before you need them. Most banks charge a penalty if you withdraw money before the CD matures.
“CDs are a great vehicle for savers because they can take the analysis paralysis out of where to put your money for the time you leave it in there, and you can focus your attention on other parts of your finances,” said Bernadette Joy, a personal finance coach and CNET Financial Review Board member.
Even though rates are high, it’s best to make sure the CD term you choose aligns with your financial goals. If you need the money before the term ends, you could pay an early withdrawal penalty fee that eats away at your earnings — even with a high rate.
What to keep in mind when comparing CD accounts
In addition to a competitive APY, you should also consider the following when comparing CD accounts:
- How soon you’ll need the funds: Early withdrawal penalties can chip away at your interest earnings. So, be sure to choose a term that fits your savings timeline.
- Minimum deposit requirement: Some CDs require a certain amount to open an account — typically, $500 to $1,000. Others have no minimum deposit requirement. How much money you have to put away can help you narrow down your account options.
- Fees: Fees can erode your balance. Many online banks don’t charge maintenance fees. They have lower overhead costs than banks with physical branches, and they pass these savings down to consumers through higher rates and fewer fees. Still, be sure to read the fine print for any account you’re considering.
- Federal deposit insurance: Confirm that any institution you’re considering is an FDIC or NCUA member to ensure your money is protected in the event of a bank failure.
- Customer ratings: Read customer reviews and ratings on sites like Trustpilot to make sure the bank is responsive, professional and easy to work with. “I would also try calling the customer service line so you know it will be easy to retrieve your money when you need it most,” said Joy.
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.
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