Top CD rates today: Jan. 19, 2024 — Leaders offering up to 5.51% APY

Rates on certificates of deposit (CDs) peaked late in 2023. While they’ve slipped a bit as of late, the top annual percentage yields (APYs) on CDs are still higher than the rate of inflation. Today’s top APY on a nationally available CD is 5.51 percent, which is offered on a one-year term.

When shopping around for a CD, you may find that competitive CD rates are similar to those of high-yield savings accounts. One difference between both types of accounts is that CDs typically guarantee the same APY throughout their term (provided you keep your money locked away in the CD during that term), whereas banks may change their savings account APYs at any time, partly in response to rate changes made by the Federal Reserve. As such, securing a high CD rate now will benefit you if we head into a falling-rate environment later this year.

Bankrate monitors CD rates every weekday, and today’s top rates are listed in the table below.

Key takeaways

• The overall top rate for widely available CDs is a one-year term that earns 5.51 percent APY.

• Top rates on terms up to two years are 5 percent APY or higher, while best rates on terms of three to five years are between 4.5 percent APY and 4.75 percent APY.

• It pays to shop around because national averages are just a fraction of the top rates, and some banks continue to offer near-zero rates.

Today’s CD rates by term

Featured CD of the day

Ally Bank’s 12-month CD currently earns a competitive yield of 5 percent, and there’s no minimum deposit required. In all, Ally Bank offers seven terms of CDs that range from three months to five years, as well as a no-penalty CD and two terms of Raise Your Rate CDs. The early withdrawal penalty for Ally’s 12-month CD is 60 days’ worth of interest.

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.