CDs
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Sheiresa McRae Ngo
Written by
Marc Wojno
Edited by
Jun 20, 2024 / 5 min read
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Key takeaways
- Today's leading CD rate across terms is 5.36% APY, offered on a one-year term.
- Rates of at least 5% APY can be found on various CD terms.
- The best rates on most terms are more than triple the national average yields, so it pays to shop around.
Not all certificates of deposit (CDs) are created alike, especially when it comes to rates of return. A CD that earns a competitive annual percentage yield (APY) can earn you hundreds, if not thousands, more in interest than one that merely earns the national average APY. As such, it’s worth shopping around for the best rate before committing your funds to a CD.
Today, the leading APY across CD terms among banks we monitor is 5.36 percent, which is available on a one-year term from CIBC Bank and requires a minimum deposit of $1,000. You’ll find that many shorter terms are earning higher yields than longer ones in the current rate environment.
Bankrate monitors the top and average rates every weekday, and you’ll find today’s top CD rates in the table below.
Today's CD rates by term
| CD term | Institution offering top APY | Highest APY | National average APY | Estimated earnings on $5,000 with top APY |
|---|---|---|---|---|
| 3-month | Popular Direct | 5.25% | 1.22% | $64 |
| 6-month | Popular Direct | 5.35% | 1.70% | $132 |
| 9-month | Forbright Bank | 5.30% | N/A | $197 |
| 1-year | CIBC Bank USA | 5.36% | 1.79% | $268 |
| 18-month | LendingClub | 5.00% | 1.88% | $380 |
| 2-year | First Internet Bank of Indiana | 4.76% | 1.54% | $487 |
| 3-year | First Internet Bank of Indiana | 4.61% | 1.43% | $724 |
| 4-year | First Internet Bank of Indiana | 4.45% | 1.50% | $951 |
| 5-year | First Internet Bank of Indiana | 4.50% | 1.44% | $1,231 |
Note: Annual percentage yields (APYs) shown are as of June 20, 2024. APYs for some products may vary by region.
N/A: Not available; Bankrate doesn’t track national averages for the 9-month CD term due to limited available data. Estimated earnings are based on the highest APYs and assume interest is compounded annually.
Where to find the highest-paying CDs
As seen in our table above, all of the top-paying CDs are available from banks and credit unions that operate mostly or entirely online. Online-only financial institutions are known for offering higher yields than big brick-and-mortar banks. Common reasons for this are:
- Relatively new online-only banks may pay highly competitive yields as a way to attract customers. (Conversely, established brick-and-mortar banks that don’t have a strong need for new deposits generally don’t offer high APYs.)
- Financial institutions operating entirely online don’t bear the cost of maintaining branches, and some may pass along the savings to customers through higher yields.
Whether or not they maintain branches, credit unions are commonly a source of high yields. This is because they’re not-for-profit institutions, so profits are distributed to members through dividends.
What the current rate environment means for CDs
In 2022 and 2023, the Federal Reserve raised its benchmark interest rate a total of 11 times, bringing its current target range to a 23-year high of 5.25-5.50 percent. However, the Fed has left rates unchanged for seven straight meetings, due to inflation not slowing as quickly as it has in the past.
Yields on competitive savings accounts and CDs tend to move in lockstep with the Fed’s interest rate moves. As such, many banks increase their yields when the Fed raises rates, and they lower yields when the federal funds rate drops. While the Fed has held rates steady since July 2023, top CD APYs ended up peaking in late 2023 and have since been decreasing gradually.
Is it still a good time to open a CD? “Even though CD yields have pulled back a bit, you’re still able to lock in yields that are well in excess of inflation and do so for multiple years,” says Greg McBride, CFA, Bankrate’s chief financial analyst. “The declines will likely accelerate as we get closer to the Fed beginning to cut interest rates, so there is no sense in waiting.”
CD FAQs
Research methodology
Bankrate calculates and reports the national average APYs for various CD terms. Factored into national average rates are the competitive APYs commonly offered by online banks, along with the very low rates often found at large brick-and-mortar banks.
In June 2023, Bankrate updated its methodology that determines the national average CD rates. For the process, more than 500 banks and credit unions are now surveyed each week to generate the national averages. Among these institutions are those that are broadly available and offer high yields, as well as some of the nation’s largest banks.
