Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.
Before you lock up some of your savings for months or even years, make sure you choose a certificate of deposit that maximizes your earning potential.
We analyzed 458 CD accounts from 148 financial institutions to determine which ones offer the best value for savers. Our research factored in interest rates, minimum deposit requirements, compounding schedules, availability and customer experience. See which 10 CDs came out on top and find out when you should opt for a different type of savings account.
Account details are accurate as of October 8, 2025.
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Show Summary
Best CD Rates of October 2025: Up To 4.15% APY
- Vanguard Brokered Certificates of Deposit: Best 1-Month CD at 4.05% APY
- Digital Federal Credit Union Regular Certificates: Best 3-Month CD at 3.75% APY
- Service Credit Union Certificates of Deposit: Best 6-Month CD at 3.50% APY
- Consumers Credit Union Certificate Account: Best 10-Month CD at 4.00% APY
- Capital One Certificates of Deposit: Best 1-Year CD at 4.00% APY
- Synchrony Bank Certificates of Deposit: Best 3- and 5-Year CDs at 3.75% APY and 4.00% APY
- Langley Federal Credit Union Certificate of Deposit: Best 4-Year CD at 3.35% APY
- Credit Human Share Certificates: Best 7- and 10-Year CDs at 4.00% APY
Discover® 12-Month Certificate of Deposit term
Annual Percentage Yield
4.00%
Minimum Deposit Requirement
$0
Learn More 
On Discover's Website
Member FDIC
Member FDIC
4.00%
$0
The accounts below are arranged by demand for the term, rather than by the duration.
Best 3- and 5-year CDs
Synchrony Bank Certificates of Deposit
CD APY 36-month
Annual Percentage Yield (APY) is subject to change at any time without notice. Offer applies to personal non-IRA accounts only. Fees may reduce earnings. For CD accounts, a penalty may be imposed for early withdrawals. After maturity, if your CD rolls over, you will earn the offered rate of interest in effect at that time. Visit synchrony.com/banking for current rates, terms and account requirements. Member FDIC.
3.75%
Rates and details as of 9/30/25.
Minimum Deposit Requirement
$0
Terms
3 Months to 5 Years
Learn More
On Synchrony Bank's Website - Member FDIC
Annual Percentage Yield (APY) is subject to change at any time without notice. Offer applies to personal non-IRA accounts only. Fees may reduce earnings. For CD accounts, a penalty may be imposed for early withdrawals. After maturity, if your CD rolls over, you will earn the offered rate of interest in effect at that time. Visit synchrony.com/banking for current rates, terms and account requirements. Member FDIC.
3.75%
Rates and details as of 9/30/25.
$0
3 Months to 5 Years
Editor's Take
Synchrony Bank Certificates of Deposit’s three-year and five-year CDs ranked among the best overall CD rates thanks to their competitive APYs and lack of minimum deposit requirement.
Why We Like It
We like that three-year and five-year CDs from Synchrony Bank offer competitive yields of 3.75% APY and 4.00% APY, respectively, and require no minimum balance to open. We also like that interest on Synchrony Bank Certificates of Deposits is compounded daily.
What We Don’t Like
The early withdrawal penalty for Synchrony Bank Certificates of Deposits with terms of 48 months or more is 365 days’ interest.
Who It’s Best For
Synchrony Bank Certificates of Deposit’s longer-term CDs are a good choice for savers who want to avoid minimum balance requirements and are comfortable locking their cash away for several years in return for a competitive APY.
See our full list of the best 3-year CD rates for other top picks.
Pros & Cons
- Competitive APY
- No minimum deposit requirement
- Bump-up CD option
- Can withdraw interest at any time without penalty
- Early withdrawal penalty is equal to 80 days of interest
Expert's Take
Synchrony lets you withdraw interest before maturity without penalty. The penalties for early withdrawal of the principal seem pretty standard. Synchrony’s no-penalty CD pays a much lower rate than others, so you can really see the cost of early redemption.
—Jill Fopiano, CEO at O’Brien Wealth Partners
Synchrony Bank CD Rates
| Term | APY |
|---|---|
| 3 Months | 0.25% |
| 6 Months | 4.10% |
| 9 Months | 4.00% |
| 1 Year | 4.00% |
| 13 Months | 3.85% |
| 14 Months | 3.85% |
| 15 Months | 4.05% |
| 16 Months | 3.85% |
| 18 Months | 3.80% |
| 19 Months | 3.80% |
| 2 Years | 3.50% |
| 3 Years | 3.75% |
| 4 Years | 3.50% |
| 5 Years | 4.00% |
Rates & details as of 09/30/2025.
Interest is compounded daily and credited to the CD monthly. CDs automatically renew upon maturity following a 10-day grace period. During the grace period, account holders can add or withdraw funds, change CD terms or close the account.
Best 1-Year CD
Capital One Certificates of Deposit
CD APY 12-month
4.00%
Rates and details as of 9/11/25.
Minimum Deposit Requirement
$0
Terms
6 Months to 5 Years
Learn More
On Bankrate.com's Website
4.00%
Rates and details as of 9/11/25.
$0
6 Months to 5 Years
Editor's Take
Capital One offers a wide range of CDs, ranging from six months to five years, all with competitive yields and no minimum deposit requirements. We chose the Capital One Certificates of Deposit as the best one-year CD because it offers a highly competitive rate of 4.00% APY.
Why We Like It
We like that the one-year Capital One Certificates of Deposit account offers the highest yield available on Capital One Certificates of Deposit (4.00% APY) and has no minimum balance requirement.
What We Don’t Like
Like most CDs, if you withdraw funds before the CD has matured, you’ll be charged an early withdrawal penalty. For a Capital One Certificates of Deposit with a term of 12 months or less, the penalty is three months’ interest. Partial withdrawals of the principal are not permitted.
Capital One also does not offer other CD variants, such as no-penalty CDs or jumbo CDs.
Who It’s Best For
Because there is no minimum deposit requirement, a Capital One Certificates of Deposit is a worthwhile option for both beginner and experienced savers looking to earn a high APY and maximize their savings, regardless of the amount.
See our full list of the best 1-year CD rates for other top picks.
Pros & Cons
- No minimum deposit requirement
- Flexible interest payout options
- Backed by a reputable institution
- Other banks offer higher APYs
- Few branches compared to other national banks
- Strict early withdrawal penalty
Details
Interest on Capital One Certificates of Deposits compounds and gets credited to your account monthly. Upon your CD’s maturity, you have a 10-day grace period during which you can withdraw from your CD before it renews for another term. If you withdraw your principal balance before maturity, you’ll pay a penalty fee equal to six months of interest for CD accounts longer than 12 months. For CD accounts of 12 months or less, the penalty fee is three months of interest.
| Capital One Certificates of Deposit Term | APY |
|---|---|
| 6 Months | 3.50% |
| 9 Months | 3.50% |
| 1 Year | 4.00% |
| 18 Months | 3.80% |
| 2 Years | 3.60% |
| 30 Months | 3.60% |
| 3 Years | 3.60% |
| 4 Years | 3.60% |
| 5 Years | 3.60% |
Rates & details as of 09/11/2025.
Best 6-Month CD
Service Credit Union Share Certificate
CD APY 6-month
3.25%
Minimum Deposit Requirement
$500
Terms
3 months to 5 years
3.25%
$500
3 months to 5 years
Editor's Take
Service Credit Union Share Certificate’s six-month CD made our list of best CD rates, offering an impressive 3.25% APY and only requiring a minimum deposit of $500.
Why We Like It
We like that this account has a relatively low minimum deposit requirement, so it’s a good choice for both new and established savers. Plus, it earns one of the highest APYs on our list.
What We Don’t Like
We dislike that dividends are compounded monthly instead of daily. Additionally, to become a member of Service Credit Union, you must qualify for membership, open a Primary Savings account and deposit $5 before you can open a CD account.
Who It’s Best For
This account is an attractive option for active-duty military members, veterans and their families who want risk-free, predictable returns on their savings.
See our full list of the best 6-month CD rates for other top picks.
Pros & Cons
- Competitive dividend rates across terms
- Wide variety of term lengths
- Reasonable minimum balance requirement
- Membership is required
- Dividends compounded monthly
Details
There are various ways to qualify for membership, including those in active-duty military service and their family members. Anyone, however, can join by becoming a member of the American Consumer Council or Financial Fitness Association.
Early withdrawal penalties depend on your CD term and how much you withdraw. For accounts that automatically renew, you have a 10-day grace period after maturity to withdraw or add funds without penalty. Dividends are compounded and credited to your certificate account monthly.
| Service Credit Union Share Certificate Term | APY |
|---|---|
| 3 Months | 3.25% |
| 6 Months | 3.25% |
| 7 Months | 4.15% |
| 9 Months | 3.75% |
| 1 Year | 3.50% |
| 15 Months | 3.50% |
| 18 Months | 3.25% |
| 2 Years | 3.00% |
| 3 Years | 2.35% |
| 4 Years | 2.45% |
| 5 Years | 2.50% |
Best 3-Month CD
Digital Federal Credit Union Regular Certificates
CD APY 3-month
3.75%
Minimum Deposit Requirement
$500
Terms
3 months to 5 years
3.75%
$500
3 months to 5 years
Editor's Take
DCU offers CD terms ranging from three to 60 months. We chose Digital Federal Credit Union Regular Certificates account as the best three-month CD because it offers a competitive APY and can be opened with a $500 deposit.
Why We Like It
We like that the three-month CD offers the highest yield from DCU Regular CDs—3.75% APY—and has a relatively low balance requirement.
What We Don’t Like
To join DCU, you must open a Primary Savings account with a minimum deposit requirement of $5. If you aren’t eligible to join based on family relations, company or community, you can become a member by joining one of DCU’s participating organizations. Membership starts at $10.
Who It’s Best For
This account is best for individuals seeking a short-term, risk-free savings option, and those who prefer to bank with a credit union. Since branch access is limited, it’s also a good choice for individuals who are comfortable banking online.
See our full list of the best 3-month CD rates for other top picks.
Pros & Cons
- Competitive CD rates across all terms
- Can withdraw dividends at any time
- Relatively low opening deposit
- Membership open to anyone
- Some membership options require a one-time fee to a charity
- Short grace period
Details
There are several ways to qualify for a DCU membership. If you’re not eligible for a DCU membership by community or company, you can join by becoming a member of one of its partner charities, like Reach Out for Schools ($10 membership).
Credit union certificates earn dividends rather than interest. At DCU, dividends compound daily and are credited monthly. Early withdrawal penalties are equal to 60 days to 180 days of dividends, depending on the term. You have a five-day grace period after maturity to withdraw funds or adjust your CD’s term before it renews.
| Digital Federal Credit Union Quickstart Certificates Term | APY |
|---|---|
| 3 to 5 Months | 3.75% |
| 6 to 11 Months | 3.50% |
| 12 to 23 Months | 3.25% |
| 24 to 35 Months | 3.00% |
| 36 to 47 Months | 3.00% |
| 48 to 59 Months | 3.25% |
| 60 Months | 3.25% |
Best 7- and 10-Year CDs
Credit Human Share Certificates
CD APY 84-month
4.00%
Minimum Deposit Requirement
$500
Terms
3 months to 10 years
4.00%
$500
3 months to 10 years
Editor's Take
Credit Human Share Certificates offers an extensive lineup of CDs, and scored at the top of our list of both best seven- and 10-year CDs, which are less commonly available than other terms. Both CDs earn an APY of 4.00%.
Why We Like It
We like that Credit Human Share Certificates offers a solid lineup of CD accounts, all with fairly competitive rates. Both the seven and 10-year CDs earn a high rate of 4.00% APY.
What We Don’t Like
Becoming a member of Credit Human Share Certificates is easy, but we don’t like that you’re required to open a Share Savings account, which requires a minimum balance of $5.
Although not particularly high, Credit Human Share Certificates’s CD accounts have a minimum balance requirement of $500. Other accounts on our list have lower or no minimum balance requirements at all.
Who It’s Best For
These accounts are best suited for individuals seeking a longer-term, risk-free savings option, and who are not concerned about lack of liquidity.
See our full list of the best 7-year CD rates for other top picks.
Pros & Cons
- Competitive APYs
- Wide range of available terms
- Monthly compounding frequency
- Higher minimum deposit requirement
Details
Credit Human membership is available to individuals who fall into one of the following categories:
- Employee or member of one of Credit Human’s employer or organization partners
- Live, work, worship or attend school in Credit Human’s San Antonio or New Orleans service area
- Veteran, retiree, active-duty member or dependent of a member of the U.S. Armed Forces or National Guard
- Study at one of Credit Human’s trade school, college or university partners
- Related to or live with a Credit Human member
If none of the above apply to you, you can become a member by joining the American Consumer Council (ACC). Credit Human will cover your fee to join.
| CREDIT HUMAN SHARE CERTIFICATE TERM | APY |
|---|---|
| 3-5 Months | 3.41% |
| 6-11 Months | 4.00% |
| 12-17 Months | 4.05% |
| 18-23 Months | 4.05% |
| 24-35 Months | 4.00% |
| 36-59 Months | 3.95% |
| 60-83 Months | 4.00% |
| 84-119 Months | 4.00% |
| 120 Months | 4.00% |
Best 4-Year CD
Langley Federal Credit Union Certificate of Deposit
CD APY 48-month
3.35%
Minimum Deposit Requirement
$500
Terms
3 months to 5 years
3.35%
$500
3 months to 5 years
Editor's Take
Langley Federal Credit Union Certificate of Deposit topped our list of the best four-year CDs.The account earns a competitive APY and can be opened with just $500. To join Langley, you need a Social Security number, proof of name, address and birthday, a reasonable minimum deposit and a Langley Savings account.
Why We Like It
We like that this account earns a competitive yield of 3.35% APY and can be opened with a relatively low minimum deposit requirement. There’s no maximum deposit limit, and funds are insured up to $250,000 by the National Credit Union Administration (NCUA).
What We Don’t Like
We don’t like that to become a member, you must open a Langley Savings account and deposit at least $5. Also, while many of Langley Federal Credit Union Certificate of Deposit rates are competitive, they’re still slightly lower than some other accounts on this list.
For CD terms of 12 months or longer, the penalty is 180 days’ dividends if you withdraw funds from your account before it matures.
Who It’s Best For
This account is best for current Langley members or those willing to join and open a Langley Savings account before opening a CD. Opening a four-year CD can be a great way to lock in high rates, as long as you’re comfortable not accessing your cash for several years. Four-year CDs can also be used as part of a CD ladder.
See our full list of the best 4-year CD rates for other top picks.
Pros & Cons
- Most terms have competitive APYs
- Relatively low minimum deposit requirement
- Wide range of CD terms
- Must open a savings account to become a member
- Dividends compounded monthly
Details
Dividends on Langley Federal Credit Union Certificate of Deposits are compounded and credited to your account monthly. For accounts that automatically renew, you have a seven-day grace period after maturity to withdraw funds without penalty. Early penalty fees are 90 days’ dividends for terms of less than 12 months and 180 days’ dividends for terms of 12 months or longer.
To be eligible for membership, all you need is proof of name, address and date of birth, as well as a Social Security number. To join, you must open a Langley Savings account and deposit $5.
| Langley Federal Credit Union Certificate of Deposit Term | APY |
|---|---|
| 3 Months | 1.00% |
| 6 Months | 2.00% |
| 9 Months | — |
| 10 Months | — |
| 1 Year | 3.51% |
| 18 Months | 3.40% |
| 2 Years | 3.35% |
| 30 Months | 3.45% |
| 3 Years | 3.40% |
| 4 Years | 3.35% |
| 5 Years | 3.30% |
Best 10-Month CD
Consumers Credit Union Certificate Account
CD APY 10-month
4.00%
Rates and details as of 10/03/25.
Minimum Deposit Requirement
$250
Terms
91 Days to 5 Years
Learn More
Read Our Review
4.00%
Rates and details as of 10/03/25.
$250
91 Days to 5 Years
Editor's Take
We selected Consumers Credit Union Certificate Account as the top choice for best nine-month CDs because it offers a competitive rate of — APY with a reasonable minimum balance requirement.
Why We Like It
We like that this account offers a yield of — APY and can be opened with a low minimum deposit requirement of $250.
What We Don’t Like
While Consumers Credit Union Certificate Account offers a wide variety of CD accounts ranging from 91 days to five years, including jumbo CDs, most rates are low.
Who It’s Best For
This is a good option for both new and established savers who want a guaranteed rate of return on their savings but don’t want to commit to a longer-term CD.
Consumers Credit Union Certificate Account is primarily an online credit union, offering only a handful of branch locations throughout Illinois. For this reason, this account is best suited for individuals who are comfortable with online banking.
See our full list of the best 9-month CD rates for other top picks.
Pros & Cons
- Competitive promotional rates
- Wide range of term lengths
- Low minimum deposit requirement
- Interest compounds daily
- Nonpromotional rates are not competitive
- Membership is required
Details
Consumers Credit Union Certificate Account offers 11 standard certificate terms, ranging from 91 days to five years. In order to open a Consumers certificate, you must be a member of the credit union. This requires a one-time $5 donation that Consumers will reimburse.
| Consumers Credit Union Certificate Account Term | APY |
|---|---|
| 91 Day | 0.50% |
| 6 Months | 0.65% |
| 10 Months | 4.00% |
| 1 Year | 0.90% |
| 17 Months | 3.75% |
| 18 Months | 0.99% |
| 2 Years | 1.00% |
| 30 Months | 1.19% |
| 3 Years | 1.30% |
| 4 Years | 1.35% |
| 5 Years | 1.50% |
Rates & details as of 10/03/2025.
Best 1-Month CD
Vanguard Brokered Certificates of Deposit
CD APY 1-month
4.05%
Minimum Deposit Requirement
$1,000
Terms
1 month to 10 years
4.05%
$1,000
1 month to 10 years
Editor's Take
Vanguard Brokered Certificates of Deposit’s one-month CD ranked among the best overall CD rates. It earns an impressive yield of 4.05% APY, the highest on this list.
Why We Like It
We like that this CD earns a super competitive rate of 4.05% APY.
What We Don’t Like
While there’s no early withdrawal fee, you must sell your CD on the secondary market to access your money before the CD term ends, which means there’s a possibility you could sell for less than you paid.
Who It’s Best For
This account is ideal for individuals who prefer brokered CDs.
See our full list of the best 1-month CD rates for other top picks.
Pros & Cons
- Impressive APYs
- Reasonable minimum deposit requirement
- No early withdrawal penalties
- No compounding interest
- Need to sell on secondary market if you want your cash early
Details
Brokered CDs are different from CDs offered directly by banks in that you have to buy them through the secondary market. Instead of opening a CD account with a bank, you can buy a CD through a brokerage like Vanguard.
Vanguard Brokered Certificates of Deposits have some of the highest rates on the market, but they also come with a risk. If you want to access your money before the CD term ends, you’ll have to sell the CD. Depending on market conditions, the CD’s value could have decreased, meaning you may lose money.
| Vanguard Brokered Certificates of Deposit Term | APY |
|---|---|
| 1 to 3 Months | 4.05% |
| 4 to 6 Months | 3.80% |
| 7 to 9 Months | 3.85% |
| 10 Months to 1 Year | 3.87% |
| 13 to 18 Months | 3.87% |
| 2 Years | 3.87% |
| 3 Years | 3.87% |
| 4 Years | 3.90% |
| 5 Years | 4.00% |
| 7 Years | — |
| 10+ Years | 4.20% |
Compare the Best CD Rates Of 2025
Best For
Best 1-Month CD
Annual Percentage Yield
4.05%
Minimum Deposit Requirement
$1,000
Terms
1 month to 10 years
Best For
Best 3-Month CD
Annual Percentage Yield
3.75%
Minimum Deposit Requirement
$500
Terms
3 months to 5 years
Best For
Best 6-Month CD
Annual Percentage Yield
3.50%
Minimum Deposit Requirement
$500
Terms
3 months to 5 years
Best For
Best 10-Month CD
Annual Percentage Yield
4.00%
Minimum Deposit Requirement
$250
Terms
91 Days to 5 Years
Best For
Best 1-Year CD
Annual Percentage Yield
4.00%
Minimum Deposit Requirement
$0
Terms
6 Months to 5 Years
Best For
Best 3-Year CD
Annual Percentage Yield
3.75%
Minimum Deposit Requirement
$0
Terms
3 Months to 5 Years
Best For
Best 4-Year CD
Annual Percentage Yield
3.35%
Minimum Deposit Requirement
$500
Terms
3 months to 5 years
Best For
Best 5-Year CD
Annual Percentage Yield
4.00%
Minimum Deposit Requirement
$0
Terms
3 Months to 5 Years
Best For
Best 7-Year CD
Annual Percentage Yield
4.00%
Minimum Deposit Requirement
$500
Terms
3 months to 10 years
Best For
Best 10-Year CD
Annual Percentage Yield
4.00%
Minimum Deposit Requirement
$500
Terms
3 months to 10 years
Latest News on CD Rates: Are Rates Rising, Falling or Staying the Same?
The Federal Reserve held interest rates steady at 4.25% to 4.50% during its June 18 policy meeting, sticking with its cautious stance as officials assess inflation trends, labor market strength and the potential economic impact of shifting trade policies.
For savers, the Fed’s pause offers a potential advantage. While the national average savings rate remains low, at just 0.40%, according to the Federal Deposit Insurance Corporation (FDIC), many CDs continue to pay more than 4.00% APY.
If you’ve been sitting on the sidelines, now may be a smart time to act. Some experts suggest policymakers will lower rates before the end of 2025, causing CD rates to decline. Our CD rate forecast includes more fresh insights for savvy savers.
Today's Highest CD Rates by Term
The highest CD rates today reach 4.94% APY, but the key is to find the best CD rate that matches a term that fits your financial needs. Also keep in mind that banks change yields all the time, depending on market conditions. As the Federal Reserve brings down borrowing rates, for instance, expect CD yields to fall.
Current Promotional CD Rates
| INSTITUTION | CD TERM | APY | MINIMUM DEPOSIT REQUIREMENT |
|---|---|---|---|
| Service Credit Union Certificates of Deposit | 7 Months | 4.25% | $500 |
| Consumers Credit Union | 10 Months | 4.00% | $250 |
| Capital One 360 | 1 Year | 4.00% | $0 |
| Synchrony Bank Certificates of Deposit | 15 Months | 4.05% | $0 |
| Langley Federal Credit Union Certificate of Deposit | 9 Months | — | $500 |
Consumers Credit Union Certificate Account rates and details are accurate as of 10/03/2025. Capital One Certificates of Deposit rates and details are accurate as of 09/11/2025. rates and details are accurate as of . Service Credit Union Share Certificate and Langley Federal Credit Union Certificate of Deposit
How To Choose the Best CD for You
If you’re thinking about opening a CD but aren’t sure where to start, here are the steps I follow when selecting the best CDs for my needs.
- Read Up on the Economy: First, I research whether economists expect the Federal Reserve to adjust the federal funds rate at the next Federal Open Market Committee (FOMC) meeting. If rates are expected to fall, I’ll lock in a CD ASAP. If economists expect rates to rise, I’ll sit tight until after the Fed announces its decision and banks respond by increasing their APYs. If rates are likely to remain the same, I won’t wait to open an account if I’m ready.
- Pick a Term Length: Next, I’ll decide how long I can afford to have some of my savings locked away. Terms typically range from one month to 10 years, and the length I choose depends on the balance in my emergency savings account, my upcoming expenses and my overall savings goals.
- Compare APYs: Once I’ve chosen a term length, it’s time to start shopping around for the highest APY. I always start by looking at rates from online banks and credit unions, which typically offer higher APYs than brick-and-mortar banks.
- Consider Compounding Schedules: If two or more institutions offer the same APY on a CD term, I’ll dig deeper and find out if they calculate compound interest daily, monthly or quarterly. The more frequently my CD’s interest compounds, the more I can earn, especially on larger balances.
- Evaluate Early Withdrawal Penalties: If the compounding frequency on CDs between two institutions is also the same, I’ll review their early withdrawal penalty policies, to see how much interest I may lose if I withdraw my funds before the account matures. Early withdrawal penalties can be hefty, offsetting much of the interest I may have earned.
- Assess the Requirements: After finding a competitive APY from a reputable institution, I’ll make sure I satisfy the account’s minimum deposit requirement. Some CDs have no minimum deposit requirement, but others require initial deposits of several thousand dollars.
- Ensure the Institution Is Insured: The final step I take when choosing a CD is confirming that the institution offering the CD is federally insured by the Federal Deposit Insurance Corp. or National Credit Union Association. The FDIC insures up to $250,000 per depositor, bank, and ownership category. The NCUA insures individual accounts at credit unions for up to $250,000. All CDs on our list are either FDIC- or NCUA-insured. Once I’ve confirmed my funds are safe, I’ll begin the application process.
Looking for CD rates near you? Check out our guide to CDs by state to find the best rates where you live.
When To Consider a CD
Overall, CDs can be great savings vehicles depending on your financial goals. The following are reasons you should consider opening a CD:
- Competitive Interest: CDs earn higher-than-average APYs on deposits, helping you maximize your savings over time. If you’re OK with not accessing your funds until the CD matures, locking in a competitive rate can pay off.
- Guaranteed Returns: Because interest rates on CDs are fixed, you’ll know exactly how much interest you’ll earn over the life of the CD. This predictability can help you better manage your savings and meet your financial goals.
- Safety: CDs from reputable banks and credit unions are FDIC- or NCUA-insured for up to $250,000.
Because the Federal Reserve may cut the federal funds rate before the end of 2025, now’s a good time to open a CD to lock in high rates before they fall.
The best time to consider a CD is after you have at least three months’ worth of income earning interest in an emergency fund, optimally in a high-yield savings account. Any additional savings sitting on the sidelines is ideal for a CD account, or multiple CDs if you’re establishing a CD ladder. This way, your emergency savings remains accessible if you need it, while your CD accounts supply you with a steady stream of interest.
— Michael Benninger, Managing Editor
When Not To Consider a CD
Sometimes a CD isn’t a suitable option for your savings goals. Here’s why you may not want to invest in a CD.
- Limited Access to Funds: When you open a CD, you agree to lock away your cash for a specified period of time in exchange for a higher APY. If you withdraw funds from your CD before it matures, you’ll be charged an early withdrawal penalty, which can offset part of the interest you’ve earned. If you’re looking for a savings vehicle that lets you access your cash more frequently, a high-yield savings account might be a better choice.
- Future Rate Increases: You may be better off waiting to open a CD if you expect savings rates to rise. If rates increase after you’ve opened an account and locked in an APY, you’ll miss out on potential earnings.
- Inflation: High inflation can cause CDs to lose their purchasing power over time.
How To Open a CD Account
- Choose your CD: Several types of CDs are available, so it’s important to choose the one that best suits your financial needs. You’ll also need to decide how long you can comfortably tie up your savings and select a suitable CD term.
- Select a bank or credit union to open your account: When choosing which bank to open your CD account with, consider an account’s APY, minimum deposit requirement, compounding schedule and early withdrawal penalties.
- Apply for an account: Often, CDs can be opened online. When applying, you’ll need to provide basic personal information, including your full legal name, residential address, Social Security number, date of birth, phone number and email address. To fund your new CD, you’ll need to provide the routing and account numbers for an existing bank account.
Opening Multiple CD Accounts
Opening multiple CDs at once can be an effective way to grow your savings. Known as CD laddering, this strategy involves opening multiple CD accounts with varying term lengths, so that when each CD matures, you’ll have access to a part of your savings.
For example, say you invest $10,000 evenly across five CDs with terms ranging from one year to five years and increasing in one-year increments. When each of these initial deposits matures, you’ll reinvest it into a longer-term CD.
So, when your one-year CD matures, you’ll reinvest that cash into a five-year CD. When your two-year CD matures, you’ll open another five-year CD, and so on, continuing the ladder. After five years, one of these five-year CDs will mature each year, giving you access to a portion of your cash.
How Much Does a $10,000 CD Earn in a Year?
How much your CD earns in one year depends on your account’s APY, term length and compounding schedule. For example, a $10,000 CD with a 4.00% APY compounded monthly would earn $400 in interest after a year. A three-year CD with the same rate and deposit would earn around $1,250. If your CD had an APY of 4.50%, you’d make even more: $450 after one year and about $1,400 after three years.
Use our CD calculator to determine how much you’d earn with a CD, depending on term length, APY and initial deposit.
Alternatives to Certificates of Deposit
If you’re looking for a savings account with a high interest rate and easy access to your funds, consider the following CD alternatives.
High-Yield Savings Accounts
Money Market Accounts
Methodology
To create this list, Forbes Advisor analyzed 458 CD and share certificate accounts across 148 financial institutions, including a mix of traditional brick-and-mortar banks, online banks and credit unions. For the star rating, we ranked each account on 11 data points within the categories of APY, minimums, compound interest schedule, customer experience, digital experience, available terms and overall availability. We also analyzed and ranked each account by individual term. The following is the weighting assigned to each category:
- APY: 55%
- Minimum deposit: 10%
- Compound interest: 5%
- Available terms: 5%
- Availability: 5%
- App Store rating: 3.75%
- Google Play rating: 3.75%
- Online banking: 2.50%
- BBB grade: 3.75%
- Trustpilot rating: 3.75%
- Live chat: 2.50%
Banks We Monitor
Frequently Asked Questions (FAQs)
Are CDs safe?
Yes. CDs from reputable banks and credit unions are FDIC- or NCUA-insured for up to $250,000.
Do CD accounts have fees?
CDs do not charge monthly maintenance fees like savings accounts often do. However, if you withdraw funds before your CD has matured, you will have to pay an early withdrawal penalty.
Are CDs taxable?
Yes, interest of $10 or more earned on a CD is considered taxable income by the IRS.
Can you lose money in a CD?
Yes, it is possible to lose money in a CD account but typically only if you withdraw funds from your account before it matures. That’s when you’ll face an early-withdrawal fee and sacrifice some or all of the interest your account has accrued.
How much money should I keep in CDs?
There’s no one right answer about how much you should put into a CD. The amount depends on a variety of factors. Asking yourself the following questions can help you figure out how much makes sense for you.
- Do you have sufficient emergency savings?
- What are your financial goals?
- How much money do you need or want to earn, and by when?
- Do you have plenty of liquid cash elsewhere?
- Do you have enough money to meet an account’s minimum deposit requirement?
- Will I exceed FDIC-insurance limits?
Are there any 7% CDs?
CDs with APYs near 7.00% aren’t currently available to most Americans, but if you look hard enough, you’ll likely find a few small credit unions advertising rates in that range. But, as with most credit unions, membership is usually restricted to individuals who live in a certain region or have a relationship with a particular employer or organization.
