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Top CD rates today: April 3, 2024 | Highest APY falls to 5.31%
Karen Bennett is a senior consumer banking reporter at Bankrate. She uses her finance writing background to help readers learn more about savings and checking accounts, CDs, and other financial matters.
Marc Wojno is a seasoned and accomplished finance editor and writer with more than two decades of experience editing and writing across a variety of news platforms including newswires, newsletters, magazines and online news sites.
Before joining Bankrate, Marc was Senior Editor at CNET Money and Senior Editor of Finance for ZDNet, both Red Ventures companies, where he wrote and edited news articles and features on a variety of topics including banking, blockchain, credit cards, cryptocurrency, fintech, home equity, investing and taxes.
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Key takeaways
The leading CD rate across terms has fallen slightly to 5.31%, and it's offered on a one-year term.
In addition to choosing a CD based on APY, be sure to pick a term that suits your financial goals.
Competitive CDs are earning at least three times the national average rates.
Opening a fixed-rate certificate of deposit (CD) with a term of at least one year today should give you peace of mind that your savings will continue to earn the same annual percentage yield (APY) should rates begin to retreat later this year. APYs on competitive CDs have been high as of late because they follow the federal funds rate, which is currently at 5.25-5.50 percent — the highest it has been since early 2001. But with the Federal Reserve expected to lower rates later this year, CD APYs could eventually drop, in turn.
Today, the leading APY across CD terms has dropped slightly to 5.31 percent. That rate is for a one-year CD, and it's offered by First Internet Bank of Indiana. Shorter terms continue to earn higher yields than longer ones in the current rate environment.
Check out Bankrate’s table below for the highest APY on CD terms from three months to five years, as well as how much $5,000 would earn for each term.
Note: Annual percentage yields (APYs) shown are as of April 3, 2024. APYs for some products may vary by region.
N/A: Not available; Bankrate doesn’t track national averages for the 9-month CD term due to limited available data. Estimated earnings are based on the highest APYs and assume interest is compounded annually.
When is a CD a good idea?
A CD can be a good place for money you’re saving for future purchases or expenses. For instance, you might put money into a 12-month CD for a vacation you’re planning for next year. Or, you might deposit funds into a five-year CD to make a down payment on a house soon after the CD matures. A benefit of locking in your money is you’ll be less tempted to use it for impulse purchases in the meantime.
How CD rates have changed 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 5.25-5.50 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.
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