Key Takeaways
- BMO Alto has raised its 5-year CD rate to 4.80% APY, making it the national leader in that term.
- BMO Alto now holds the second spot in the 4-year term with a rate increase to 4.70%.
- MutualOne Bank offers the highest CD rates overall at 5.65% APY for a 3-month term, while Newtek Bank offers 5.55% for a 6-month term.
- For medium terms, you can find competitive rates with a 1-year CD at 5.40%, a 2-year CD at 5.25%, and a 3-year CD at 5.00%.
- Current CD rates are slightly below the fall peak and are expected to decrease with potential Fed rate cuts, although recent inflation data suggests a delay in rate adjustments.
Big Bank Boosts Long-Term CD Rates
BMO, a banking giant, has introduced market-leading CD rates with its online banking division, BMO Alto. Customers can now secure a 4.80% APY for a 5-year term or 4.70% for a 4-year term. While competitive, it’s worth exploring other options for higher returns in shorter CD terms.
Lock In 5.30% or More—For as Long as 23 Months
MutualOne Bank continues to offer the highest CD rate at 5.65% APY for a short 3-month term, ensuring returns until August. Alternatively, Newtek Bank’s 6-month CD at 5.55% APY extends the rate guarantee nearly to 2025. Several other high-yield CDs are available with rates exceeding 5.50%, covering terms up to 9 months.
Long CD Terms Secure Your Rate to 2027—Or Beyond
Considering a CD term of two years or longer can be advantageous as U.S. interest rates may decline in the next few years. Opt for a top 3-year CD offering 5.00% to secure returns until 2027 or lock in mid-to-high 4% rates for extended periods.
CD Rates Are Still Near 20-Year Highs
Although CD rates have slightly decreased from their peak of 6.50% in October, they remain favorable compared to the past two decades. Securing yields in the 4% to 5% range for extended periods presents excellent earning potential.
Jumbo CDs Offer a Rate Bump in Some Terms
State Bank of Texas and State Department Federal Credit Union have introduced top jumbo CD rates, surpassing standard CD rates. However, in some terms, standard CDs offer equally or more attractive rates, underscoring the importance of comparing both types before making a decision.
Where Are CD Rates Headed the Rest of This Year?
Following aggressive federal funds rate hikes, CD rates soared to historic levels, benefitting savers. While the Fed is currently maintaining rates due to easing inflation, rate cuts may materialize in the future, potentially impacting CD rates.
How We Find the Best CD Rates
Investopedia tracks data from over 200 banks and credit unions daily to rank the highest-paying CDs across various terms. Institutions must be federally insured, and CD deposit requirements must not exceed $25,000 to qualify. By evaluating factors like availability and eligibility criteria, we identify the top rates for consumers.