Top CD rates today: Feb. 7, 2024 — 5.51% remains highest APY across terms

Key takeaways

• The highest rate you'll find on a widely available CD is 5.51% APY, offered on a one-year term.

• Rates of at least 5% APY can be found on terms of up to two years.

• Top APYs are around three times the national averages.

The top rate available on a certificate of deposit (CD) holds steady at an annual percentage yield (APY) of 5.51 percent, which is available on a term of one year. In fact, APYs of at least 5 percent can still be found on terms of up to two years. Top rates on CDs have edged down since peaking in late 2023, although overall they still remain high.

The Federal Reserve held rates steady in last week’s rate-setting meeting, and it ultimately might decide not to cut rates for several months. “CD rates often follow the Federal interest rate, so now is a great time to open a CD and lock in a great interest rate while they remain at a higher-than-average level,” says Louise Eisenach, vice president of savings and deposits at Capital One.

Bankrate monitors top CD rates every weekday, and today’s are listed in the table below, along with how much you’d earn by investing $5,000 in CDs with the top rates.

Today’s CD rates by term

Keep in mind: Be sure to choose a CD term length that aligns with your financial timeframe of when you’ll want access to the money, whether it’s for a planned purchase or to reinvest elsewhere.

How the Federal Reserve impacts deposit account rates

When the Federal Reserve raises or lowers its key benchmark rate, the Federal Funds Rate,  competitive banks often follow suit by raising or lowering APYs on their deposit accounts, accordingly. The Fed has chosen to hold rates steady during its past four consecutive rate-setting meetings, while top CD APYs at many banks, especially online-only banks and credit unions, have remained elevated — although they’ve been slipping slightly.

While the Fed continues to maintain its high-level federal funds rate of 5.25-5.5 percent, many banks may cut the rates on their deposit accounts once the Fed starts paring back its benchmark rate. “As the Fed continues to evaluate and update rates, we’ll continuously update our rates with that context,” Capital One’s Eisenach says.

CD rates in 2022 through 2024

National average CD yields rose steadily in 2023, as the Federal Reserve continued to hike interest rates at the fastest pace since the 1980s. In all, Fed officials increased rates 11 times between 2022 and 2023, bringing the federal funds rate to its current target range of 5.25-5.5 percent. Along with these rate hikes, average CD APYs rose to the highest they’d been in many years, with APYs on some competitive CDs climbing as high as 7 percent.

This year is expected to be a banner one for CD savers. Greg McBride, CFA, Bankrate’s chief financial analyst, predicts two Fed rate cuts in 2024, yet he says CD yields will continue to top inflation. “Savers have another good year in which their returns will shine, with inflation expected to decline further,” he says.

McBride also stresses the importance of shopping around for the highest APY. “Top-yielding offers are still going to deliver a notable advantage [over lower-yielding ones],” he adds.

CD FAQs

• Is a CD a good idea right now?

  
  Although Federal Reserve rate cuts are widely expected in 2024, and banks may lower deposit account rates as a result, CD yields are expected to remain strong and outpace inflation. Overall, average yields remain higher than they’ve been in years, while the top APYs on many terms are more than triple the national averages.
  
  Opening a competitive CD now means you won’t be missing out on a high APY should rates start to fall later this year. Because a CD typically earns a fixed rate, you’ll continue to earn the same yield throughout its entire term, even if rates on new CDs start to drop.
  

• What should you consider when choosing a CD?

  Before committing money to a CD, make sure you’re comfortable parting with the funds for the entire term; withdraw the funds early and you’ll likely be hit with an early withdrawal penalty. As such, a CD isn’t a good place for your emergency fund. Other factors to consider include:

  • Annual percentage yield, or APY: Not all banks are equal when it comes to APYs, so it pays to check out what various banks are offering. Online-only banks are known for paying high yields, so they’re a good place to start your search.

  • When you’ll need access to the money: CDs commonly come in terms between three months and five years, although you’ll sometimes be able to find terms as short as one month and as long as 10 years. Make sure you choose a term that corresponds with when you’ll want the money for a planned purchase or other investment.

  • Minimum deposit requirement: Some banks, such as Ally Bank and Synchrony Bank, don’t require any set minimum deposit, while others may require $1,000, $5,000 or even as much as $10,000. When shopping around, find a CD with a minimum deposit that aligns with your saving goals.

  • Federal deposit insurance: Before opening a CD, make sure the bank is insured by the Federal Deposit Insurance Corp. (FDIC). Likewise, if it’s a credit union, make sure it’s insured through the National Credit Union Administration (NCUA). This way, should the financial institution close its doors, your funds will be insured for up to $250,000 per depositor, per insured bank or credit union, for each account ownership category.

• Can you lose money in a CD?

  
  Your money is protected in a CD when it’s with a bank insured by the Federal Deposit Insurance Corp. (FDIC) or a credit union insured through the National Credit Union Administration (NCUA). When institutions are covered by this federal insurance, CDs and share certificates are each insured for up to $250,000 per depositor, per insured bank or credit union, for each account ownership category.
  
  CDs typically require that you lock in your money for a set term, and taking out the money before the term ends usually results in an early withdrawal penalty. This penalty causes you to lose some of your interest — and possibly also some of your principal, which is the money you originally deposited in the account.
  

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.