Top CD rates today: Jan. 18, 2024 — APYs on many terms remain above 5%
Today’s top widely available rate on a certificate of deposit (CD) is 5.51 percent annual percentage yield (APY) for a term of one year. While APYs on some terms are down ever so slightly over the past several weeks, yields remain high.
You’ll still find rates at or above 5 percent APY on CD terms of up to two years, while APYs of 4.5 to 4.75 can be locked in on terms between three and five years.
Taking advantage now of a CD’s guaranteed APY can be your best bet if the going rates are expected to drop anytime soon. Bankrate monitors CD rates every weekday, and today’s top APYs are listed in the table below.
Key takeaways
The top overall CD rate today is 5.51 percent APY, which is offered on a one-year term.
In addition to choosing a CD based on APY, be sure to go with a term that suits your financial goals.
Competitive APYs are currently several times greater than national averages.
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% | N/A | $136 | ||
5.45% | N/A | $203 | ||
5.51% | 1.79% | $276 | ||
5.30% | 1.78% | $403 | ||
5.00% | 1.54% | $513 | ||
4.75% | 1.43% | $747 | ||
First Internet Bank of Indiana | 4.54% | 1.48% | $972 | |
4.60% | 1.44% | $1,261 |
Where can I earn 5% on a CD?
Currently, APYs of 5 percent or higher can be found on CDs with terms of up to two years. In addition to those included above in the table, financial Institutions that offer CDs of one or more terms that earn 5 percent APYs or greater include:
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
How do CDs work?
A CD is a deposit account that earns a fixed rate of return in exchange for locking in your funds for the entire term. CD terms often range from three months to five years, although it’s possible to find ones with terms shorter or longer than that. A CD can be a good place to stash money for savings goals, such as a down payment on a house or a new car. When choosing the best CD term, consider when you’ll need access to the money.
Who should get a CD?
Because a CD typically comes with an early withdrawal penalty, it’s best to only put money into a CD that you won’t need in the meantime for living expenses or emergencies. Money you may need sooner is best kept in a liquid account, such as a high-yield savings account, which provides access to your funds anytime.
Why are CDs from credit unions called “share certificates”?
Both CDs and share certificates are deposit accounts where your money typically grows at a fixed rate for a set amount of time. The main difference between the two is in the name: CDs are offered from banks, whereas share certificates are offered from credit unions. What’s more, CD earnings are referred to as interest, while share certificate earnings are called dividends. And because credit unions are not-for-profit, their profits are distributed among members (essentially shareholders in the credit union) in the form of dividends. Dividends act the same as yields on CDs, however some credit unions may offer higher rates or lower fees as a result of sharing profits.
CDs and share certificates are insured through banks and credit unions, respectively, that are federally insured. For example, banks are insured by the Federal Deposit Insurance Corp. (FDIC), whereas credit unions are insured through the National Credit Union Administration (NCUA). Under such federally insured banks and credit unions, CDs and share certificates are each insured for up to $250,000 per depositor, per insured bank, for each account ownership category.
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
