Over 20 options to earn 5.50% or better
All was quiet on the CD front today. But with certifications continuing to pay record rates — including a whopping 21 options offering at least 5.50% APY — the positive news is that higher rates nationwide are holding firm.
The three repeat leaders today are 5.75% APY for 9 months from Andrews Federal Credit Union5.65% for 3 months starting from Dow Credit Unionand 5.60% for the 11-month period Direct North Bank.
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- The highest rate nationwide on a CD for any term remains 5.75% APY, available for 9 months.
- Our daily ranking of the best CDs includes 21 certificates in the “Benchmark Leaders” group, all of which pay 5.50% APY or more.
- The longest period you can earn at least 5.00% is three years, at a rate of 5.13% APY – unless you have a large deposit that entitles you to 4 years paying 5.12% APY.
- The credit unions included in our CD rankings are easy to join for anyone in the country.
- The Fed’s next meeting on rates is not for about six weeks, and it is currently uncertain whether it will raise the federal funds rate – and thus CD rates – again this year.
To help you earn as much as possible, here are the best CD prices available from our partners, followed by more information about the most profitable CDs available to US customers everywhere.
Do you want to hold one of today’s high prices for a while longer? You have two long-term options that earn at least 5.00%. You can get 5.13% APY with the leader in our Best CDs ranking for 3 years, or if you have a minimum of $100,000 to deposit in a mega CD, you can extend that to four years at a similar rate of 5.12% APY.
CD Shopper Tip
If you think you need to hold on to a banking CD because membership in a credit union seems like a big deal, think again. The credit unions that we include in our rankings are open to anyone nationwide and easy to join. Although some require a donation to an affiliated nonprofit organization, the amount required is generally modest, and some require no donation or cost at all. The process for opening an account with a credit union is also the same as opening an account with a new bank.
Be careful
Although it is suggested that a larger deposit entitles you to a higher payout, this is not always the case for hefty certificate rates, which often pay less than standard CDs. Although today’s best jumbo deals, which typically require a deposit of $100,000 or more, beat standard best rates in five conditions on CDs, in the other three you can do as well or better with a standard CD. So always make sure to shop around each certification type before making a final decision.
Will CD prices go up this year?
CD rates are already at record highs, but they could be even higher. That’s because the Fed announced another 0.25% increase in the federal funds rate on July 26th, and it will remain at that level until at least September 20th. Credit unions are willing to pay customers for their deposits.
Since March 2022, the Fed has been aggressively battling decades-high inflation, making 11 hikes to the federal funds rate over the past 12 meetings. With the latest bump, the cumulative increase totaled 5.25% and took the federal funds rate to its highest level since 2001. That created excellent conditions for CD shoppers, as well as for anyone with cash in a high-yield savings account or in the money market.
The Fed’s official announcement in July did not provide any strong indications as to whether it would raise the benchmark interest rate higher than this year. The written statement simply reiterated the Fed’s commitment to lower inflation to its target of 2%.
In his post-announcement press conference, Fed Chairman Jerome Powell noted that the rate-setting committee had not yet made any decisions about raising rates again in 2023, or if so, what the timing or speed of any increases would follow. He specifically mentioned that both a hike and a halt were potential at the next meeting, scheduled for September 19-20.
Three Fed governors have made public statements over the past week about their expectations on whether the committee will raise or suspend interest rates in the future. Two stressed the need to monitor upcoming data and decide on a meeting-by-meeting cycle, including the possibility of implementing a further increase. But the third indicated that unless something unexpected appears in the data, he expects rates to be kept without any further increases.
For now, it’s possible that the July rally could push CD rates a little higher. But the impact may also be already behind us, since the Fed’s move was almost certain weeks in advance, and many banks and credit unions have already boosted their rates. Also, whether we’ll see a new high this year that could drive higher CD rates is a very open question at the moment.
In any case, when the Fed finally looks set to pause its rate hike campaign for good, it will be a sign that CD rates have peaked.
Note that the “higher rates” listed here are the highest rates available nationwide that Investopedia has determined in its daily rate search on hundreds of banks and credit unions. This is very different from the national average, which includes all banks that offer a CD with that term, including many of the larger ones that pay minuscule interest. Thus, the national rates are always very low, while the higher rates that you can find out by shopping around are often five, 10 or even 15 times higher.
Disclosure of the price collection methodology
Every business day, Investopedia tracks pricing data for more than 200 banks and credit unions that offer CDs to customers across the country and determines daily ratings for the highest-paying certificates in each key term. To qualify for our listings, an organization must be federally insured (FDIC for banks, NCUA for credit unions), and the minimum initial CD deposit must not exceed $25,000.
Banks must be available in at least 40 states. And although some credit unions require you to make a donation to a specific charity or association to become a member if you don’t meet other eligibility criteria (for example, you don’t live in a certain area or work in a certain type of job), we exclude credit unions whose donation requirements are $40 or more. For more information on how to choose the best rates, read our full methodology.
