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Key findings
- Although top CD rates have fallen ahead of a likely Fed rate cut next month, all benchmark interest rates have held up in recent days.
- You can still lock in the nation’s top rate of 5.40% at INOVA Federal Credit Union, whose 5-month CD guarantees your interest rate through 2025.
- To lock in a rate through 2025, the best 1-year deals pay 5.25%, offered by four institutions. Or you can score a 5.05% rate for 18 months at Federal Savings Bank.
- The longest CD yielding at least 5.00% remains a 2-year certificate from USAlliance Financial, which guarantees your interest rate through 2026. For 3-5 year fixed rates, the highest APYs reach the mid-4% range.
- It’s wise to open a fixed-term deposit account soon before interest rates drop even further – because the Fed could cut rates several times this year.
Below you will find the rates offered by our partners as well as details from our ranking of the best CDs available nationwide.
Guaranteed interest rate of 5.15% to 5.40% until 2025
Ahead of the Fed’s widely anticipated rate cuts next month — and likely further cuts in November and December — top CD rates in our national rankings have dropped slightly. However, current top rates have held steady across all CD maturities for three days in a row.
INOVA Federal Credit Union continues to pay the nation’s leading interest rate of 5.40% for 5 months, but if you want your rate guaranteed for an extra month, you can opt for second-place DR Bank instead, where you can lock in 5.35% for 6 months.
Want to extend your interest rate guarantee further? The best 1-year CDs pay 5.25%, and at that rate you have plenty to choose from. Three institutions pay that APY for 12 months, and another offers it for an 11-month term. All of these institutions extend to mid-2025.
At 18 months, the top yield is 5.15%, but the offer is valid for 15 months. With this certificate from FedChoice Federal Credit Union, your interest rate is locked in until around Thanksgiving 2025.
CD rates with a guarantee until 2026 – or beyond – also make sense
Although they offer lower annual percentage yields (APYs) than shorter-term CDs, attractive multi-year CDs are a smart move before the Fed begins cutting its benchmark federal funds rate. That cut is scheduled to begin on Sept. 18 and could continue with further cuts in 2024 and 2025. The downward pressure on interest rates could even continue into 2026.
If you want to lock in your rate through at least 2026, the best deal is Federal Savings Bank’s highest-yielding 5.05% rate for 18 months. Or you can lock in up to 5.00% for 2 years, available from USAlliance Financial.
Top rates in the mid to high 4% range can be secured for even longer. For a 3-year term, American 1 Credit Union guarantees an interest rate of 4.75% for 36 months, while Federal Savings Bank leads the way with 4.55% for 4-year terms. For a 5-year rate lock-in, you can lock in 4.50% at Pima Federal Credit Union through 2029.
Although below peak levels, CDs still promise excellent returns
It’s true that CD yields are no longer at their absolute peak. But they’re still at historic highs. In October, there was a national top rate of 6.50% – just for a few days – and today the top rate is 5.40%. Yet dozens of banks and credit unions are offering 5.00% or more. In fact, a total of 22 offerings among the best national CDs are still paying 5.25% and more.
Compare that to early 2022, before the Federal Reserve began its rapid rate hike campaign. The most you could earn on the very best CDs at any term was between just 0.50% and 1.70% APY.
Jumbo CDs only lead to 18-month offers
Jumbo CDs require much higher deposits, but don’t always offer higher interest rates. Currently, the best jumbo CDs only lead the way at 18-month terms. State Department Federal Credit Union offers 5.20% for a 15-month jumbo CD, compared to 5.15% for the current leading rate among standard 18-month certificates. At the same time, you can get the same top rates with a jumbo CD as with a standard option at 1-year and 3-year terms.
How far – and fast – will CD rates fall in 2024?
As expected, the Federal Reserve left the key interest rate at its current level at its meeting on July 31. But on Friday, Fed Chairman Jerome Powell signaled at the Fed’s annual meeting in Jackson Hole that the central bank was finally ready to cut interest rates. However, he avoided saying how big the rate cuts would be – or how quickly they would come.
“It is time to adjust policy,” Powell said. “The direction is clear, and the timing and pace of rate cuts will depend on upcoming data, the evolving outlook and the allocation of risks.”
According to the CME FedWatch tool, 71% of investors currently expect the Fed to cut interest rates by 0.25 percentage points on September 18, while the remaining 29% are forecasting a larger increase of 0.50 percentage points. But by the December 18 meeting, a large majority of traders are predicting the Fed will have cut the benchmark interest rate by at least a full percentage point.
The central bank’s mission to fight inflation led it to raise the benchmark interest rate 11 times between March 2022 and July 2023 – taking the benchmark rate to its highest level in 22 years. The rate hike campaign has been a boon for savers with cash in the bank, as the benchmark rate directly influences the interest rates banks and credit unions pay on CDs. As a result, CD rates hit a 20-year high last fall. Those with money in a high-yield savings account or money market account have also benefited from these historically high rates.
Fed officials are generally cautious not to act prematurely and will likely continue to wait for more reports before making any decisions about changing the benchmark interest rate. But with a September rate cut all but certain — and CD rates likely to be changed without the central bank’s official announcement — you may want to lock in a great CD rate while you can.
Daily rankings of the best CDs and savings accounts
Note that the “peak rates” mentioned here are the highest rates available nationwide, as found by Investopedia in its daily rate research at 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 large banks that pay a low interest rate. As a result, national averages are always quite low, while the peak rates you can find by comparing prices are often 5, 10, or even 15 times higher.
How we find the best CD rates
Each business day, Investopedia tracks interest rate data from more than 200 banks and credit unions nationwide that offer CDs to their customers, and ranks the highest-interest certificates in each major term on a daily basis. To be eligible for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), the CD’s minimum deposit cannot exceed $25,000, and a stated maximum deposit cannot be less than $5,000.
Banks must be available 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, if you don’t live in a certain area or work in a certain type of job), we exclude credit unions whose donation requirement is $40 or more. For more information on how we choose the best rates, see our full methodology.
