CD shoppers looking to make a large deposit have a new option today to earn a top-notch rate, with Credit One Bank launching a 15-month certificate paying 5.65% APY. It’s not the top return you can earn on a jumbo CD, but Sun East Federal Credit Union‘s industry-leading rate of 5.75% APY is only available for a shorter period of 11 months.
The number of “Benchmark Leader” CDs—which pay a top-tier rate of at least 5.50% APY—also increased today, to 22 from 21, while the market-leading rate across all standard CD terms held firm at 5.75% APY, available for 9 months from Andrews Federal Credit Union.
Key Takeaways
- A new CD took over the top spot in our 18-month jumbo rankings, paying 5.65% APY.
- The top nationwide rate on a CD of any duration remains 5.75% APY, available as a 9-month standard CD or an 11-month jumbo CD.
- The number of “Benchmark Leaders” in our daily ranking of the best CD rates, paying at least 5.50% APY, climbed by one today to a count of 22.
- The longest term on which you can earn at least 5.00% is three years, with a rate of 5.13% APY. But if you have a jumbo-sized deposit, you can score a 4-year term at 5.12% APY.
- The Federal Reserve’s next meeting about rates isn’t for almost six weeks, and it’s uncertain whether they’ll nudge the federal funds rate—and therefore CD rates—higher again this year.
To help you earn as much as possible, here are the top CD rates available from our partners, followed by more information on the best-paying CDs that are available to U.S. customers everywhere.
Want to lock in one of today’s high rates for an extended period? You have two longer-term options offering at least 5.00%. You can score 5.13% APY with the leader in our best 3-year CDs ranking, or if you have at least $100,000 to deposit in a jumbo CD, you can stretch that to four years for a similar rate of 5.12% APY.
CD SHOPPER TIP
If you think you need to stick with a bank CD because becoming a credit union member seems like too much trouble, think again. The credit unions we include in our rankings are open to anyone nationwide and are easy to join. Though some require a donation to an affiliated nonprofit organization, the required amount is generally modest, and some require no donation or cost at all. The process for opening an account at a credit union is also the same as opening an account at a new bank.
Beware
Despite the suggestion that a larger deposit entitles you to a higher return, that’s not always the case for jumbo certificate rates, which often pay less than standard CDs. Though today’s best jumbo offers, which typically require a deposit of $100,000 or more, beat the best standard rates in five CD terms, you can do just as well or better in the other three terms with a standard CD. So always be sure to shop every certificate type before making a final decision.
Will CD Rates Climb Higher This Year?
CD rates are already at record levels, but it’s possible they could edge higher still. That’s because the Federal Reserve announced another 0.25% increase in the federal funds rate on July 26, and it will hold at that level until at least Sept. 20. That matters because the central bank’s benchmark rate is a direct driver of the yields that banks and credit unions are willing to pay customers for their deposits.
Since March 2022, the Federal Reserve has been aggressively combating decades-high inflation, with 11 hikes to the fed funds rate over the past 12 meetings. With the latest bump, the cumulative increase totals 5.25% and brings the fed funds rate to its highest level since 2001. That’s created excellent conditions for CD shoppers, as well as for anyone holding cash in a high-yield savings or money market account.
The Fed’s official July announcement provided no strong indications on whether it will raise its benchmark rate even higher this year. The written statement simply reiterated the Fed’s commitment to bring inflation back down to its target level of 2%.
In his post-announcement press conference, Federal Reserve Chairman Jerome Powell indicated that the rate-setting committee has not made any decisions yet on whether to raise rates again in 2023, or if so, what timing or pace any increases would follow. He specifically stated that both a hike and a pause were possibilities at the next meeting, scheduled for September 19-20.
Three Fed governors have made public remarks over the past week about their expectations on whether the committee will raise or hold rates going forward. Two emphasized the need to watch the upcoming data and decide on a course meeting-by-meeting, including the possibility of implementing another increase. But the third indicated that unless something unexpected crops up in the data, he foresees rates being held without any further increases.
Since their remarks, new monthly inflation data has been released, with yesterday’s report showing that core inflation is cooling. While the Fed will also be looking to other economic indicators between now and its next meeting, this week’s inflation news could lead them to a rate pause, rather than another hike, in September.
For now, it’s possible the July hike could still push CD rates a little bit higher. Then again, most of the impact could already behind us, since the Fed’s move had been nearly certain for weeks in advance and many banks and credit unions have already boosted their rates. In any case, when it finally appears the Fed is ready to halt its rate-hike campaign for good, that will signal that CD rates have reached their peak.
Note that the “top rates” quoted here are the highest nationally available rates Investopedia has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often five, 10, or even 15 times higher.
Rate Collection Methodology Disclosure
Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD’s minimum initial deposit must not exceed $25,000.
Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.