Top CD rates today: Feb. 26, 2024 — Earn yields of up to 5.50% APY
Key takeaways
Today's highest yielding CD earns a 5.50% APY on a three-month term.
Top APYs for terms of nine months and one year have declined slightly this month.
National averages are still significantly lower than top rates, so it pays to shop around.
A certificate of deposit (CD) is an account to which you commit your money for a set term, often anywhere between three months and 10 years. In exchange for locking up your funds, the bank may pay a higher annual percentage yield (APY) than it offers on a regular savings account. What’s more, a CD’s fixed yield allows you to determine at the outset how much interest you’ll accrue when it matures.
As we enter the last week in February, top yields on nine-month and one-year CDs are down slightly from what they were earlier this month. Overall, yields on CDs remain high — although they may eventually drop further in anticipation of the Federal Reserve cutting rates in 2024. Opening a competitive, fixed-rate CD now ensures you’ll continue to earn the high rate throughout its term.
Bankrate monitors CD rates every weekday, and today’s top rates are listed in the table below.
Today’s CD rates by term
CD term | Institution offering top APY | Highest APY | National average APY | Estimated earnings on $5,000 with top APY |
|---|---|---|---|---|
5.50% | 1.25% | $67 | ||
5.35% | 1.62% | $132 | ||
America First Credit Union | 5.30% | N/A | $197 | |
Bask Bank | 5.40% | 1.73% | $270 | |
5.15% | 1.72% | $391 | ||
5.00% | 1.49% | $513 | ||
4.76% | 1.39% | $749 | ||
First Internet Bank of Indiana | 4.55% | 1.45% | $974 | |
First Internet Bank of Indiana | 4.61% | 1.42% | $1,264 |
Keep in mind: Opening a high-yield CD now ensures you’ll continue to benefit from the competitive APY, even if rates begin to drop on new CDs.
Are CDs a good deal?
Rates increased steadily on many CDs and savings accounts over the past two years, while the Federal Reserve gradually raised its key benchmark interest rate to a 22-year high. A potential benefit of a CD is you lock in a fixed APY, so you’ll continue to earn that higher rate even if going rates start to go back down.
CDs are a highly safe investment, as long as they’re offered from a federally insured bank or credit union and you’re within the set guidelines of $250,000 per depositor, per insured institution, for each account ownership category.
CD rates from 2022 to 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
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.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.
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.
Ways to take advantage of high CD rates CD rates are at historic highs CD interest rate forecast for 2024 Rates will outpace inflation
