Savers have found plenty of new options for high-yield CDs, with especially juicy rates now available for those looking to lock in higher rates for longer: the top 3-year rate went from 4.13% to 5.23% and the 5-year. The CD now offers 4.86% interest, up from 4.77% a day ago.
The new leader is for a 3, 4 and 5-year term US Senate Federal Credit Union, which took the top places for standard CDs as well as “jumbo” offers that require a large deposit. Meanwhile, America 1 Credit UnionThe 6.00% API offering over the 1-year term still leads the pack for best overall value.
Key receivers
- The best rate for a 3-year CD rose to 5.23% APY today, up from 5.13% APY.
- The top rate for a 5-year CD increased to 4.86% from 4.77%, while the top rate for a 4-year CD fell to 4.81% from 4.85%.
- The overall prime rate among the nation’s top CDs rose to 6.00% APY earlier this week, the first nationwide CD to reach that level since the Fed began raising interest rates last year.
- The number of CDs with 5.50% API or higher rose to 41 today.
- Data showing a cooling economy this week made the Fed less likely to raise interest rates again, meaning further upward pressure on CD rates is unlikely.
You’ll find the highest CD rates from our partners to help you earn as much as possible, followed by more information on the best paying CDs available for US customers everywhere.
Always make sure you understand the bank or credit union’s early withdrawal penalty for the CD you are considering. The penalty policies vary widely – from mild to severe – and you are fully within your rights to ask for the policy to be explained to you before committing your funds.
Always make sure you understand the bank or credit union’s early withdrawal penalty for the CD you are considering. The penalty policies vary widely – from mild to severe – and you are fully within your rights to ask for the policy to be explained to you before committing your funds.
Want to maintain a record rate for a longer period of time? You can earn a 5.23% API from our top 3-year CDs ranking leader, or at least 5.00% from five other competitors in that term. The maximum rates in the 4-year and 5-year terms are 4.81% APY and 4.86% APY.
If you have a jumbo deposit, you can get a little more on some terms. The maximum Jumbo rate is currently 5.85% APY, available on a 6-month certificate that requires a minimum deposit of $100,000. By paying 5.12% API, you can extend the tenure of the Jumbo Certificate to get at least 5.00% up to four years.
Despite the perception that a larger deposit entitles you to higher fees, that’s not always the case for jumbo certificate prices, which pay less than standard CDs. Although today’s best jumbo offers, which typically require a deposit of $100,000 or more, beat the best regular rates in five CD terms, you can do as well or better with a regular CD in the remaining three terms. So always make sure to buy each certificate before making a final decision.
Despite the perception that a larger deposit entitles you to higher fees, that’s not always the case for jumbo certificate prices, which pay less than standard CDs. Although today’s best jumbo offers, which typically require a deposit of $100,000 or more, beat the best regular rates in five CD terms, you can do as well or better with a regular CD in the remaining three terms. So always make sure to buy each certificate before making a final decision.
Will CD prices rise this year?
This year has seen CD rates hit record highs, but they could rise even higher. That’s because some banks and credit unions are reacting to the central bank raising the federal funds rate at its July 26 meeting. It’s also important that the Federal Reserve keeps the door open for hikes, especially in 2023.
The Fed has been aggressively fighting the high inflation rate since March of last year. The Fast and the Furious increased in 2022, with a moderate increase in 2023. It reached its highest level since 2001. That created historic conditions for CD buyers, as well as anyone with cash in a high-yielding savings or money market account.
The Fed’s official July announcement gave no firm indication that it would raise the benchmark rate this year. The written statement simply reiterated the Fed’s commitment to returning inflation to the 2 percent level it has been at.
In a speech at the Jackson Hole Economic Symposium last week, Fed Chairman Jerome Powell said that more rate hikes are on the table if inflation does not fall sufficiently in the coming months or if economic growth is too rapid (which puts significant pressure on it). The next meeting of the federation is scheduled for September 19-20. Recent public comments from other members of the federation suggest they may be divided on the issue.
Currently, Fed funds futures published by CME Group show that only 7% of traders expect the Fed to raise interest rates at the September meeting. The prospect of another rate hike this week has dimmed as data on inflation and jobs this week showed the economy and inflation slowing.
Another hike by the Fed will certainly add a little more fuel to CD prices. But if the September decision is a rate hike, markets — and CD buyers — may be left wondering if that will be a temporary or permanent pause. With the Fed finally looking like it’s ready to end its rate hike campaign for good, that means CD prices have reached record highs.
Note that the “peak rates” quoted here are the highest rates nationwide that Investopedia has identified in its daily rate survey of hundreds of banks and credit unions. This is very different from the national average, where all banks that offer CDs with that term, including many large banks, charge a small fee in interest. So, while national averages are always very low, the highest price you can get by trading is often five, 10 or 15 times higher.
Note that the “peak rates” quoted here are the highest rates nationwide that Investopedia has identified in its daily rate survey of hundreds of banks and credit unions. This is very different from the national average, where all banks that offer CDs with that term, including many large banks, charge a small fee in interest. So, while national averages are always very low, the highest price you can get by trading is often five, 10 or 15 times higher.
Disclosure of collection method
Each business day, Investopedia tracks rate data from more than 200 banks and credit unions nationwide that offer CDs to their customers and determines the highest-paying certificates for each major period. To qualify for our listings, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD’s minimum initial deposit must not exceed $25,000.
Banks must be present in at least 40 states. And while some credit unions require you to donate 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 occupation), credit unions don’t have a donation requirement of $40 or more. For more on how we choose the best rates, read our full methodology.
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