Editor’s Note: In observance of Memorial Day, Investopedia will not publish daily CD rate news on May 27, but we will resume our daily rate coverage on Tuesday, May 28.
Top CD Rates Spotlight
- The leading national CD rate remains at a competitive 5.51%, offered by TotalDirectBank for 3-month or 6-month terms.
- Runner-up CDs are offering 5.50% APY for terms ranging from 5 to 9 months.
- Current best 1-year return stands at 5.40%, with 2- to 3-year CDs offering 5.00% to 5.25%.
- For long-term rate security, consider upper-4% returns on 4- to 5-year terms, featuring BMO Alto’s leading 5-year CD at 4.80%.
- While today’s rates are slightly lower than last fall’s peak, ongoing inflation trends suggest a possible delay in Fed rate cuts.
Below, you’ll find highlighted rates from our partners, along with insights on the best CDs available nationwide.
Lock In 5.35% to 5.51%—On Terms of 3 to 15 Months
Among national leaders, TotalDirectBank maintains a solid 5.51% APY for 3-month or 6-month certificates, ensuring a stable return till Thanksgiving with a $25,000 minimum deposit requirement.
If a lower commitment is preferred, consider runner-up CDs offering 5.50% for 5 to 9-month terms, with deposits as low as $5,000 to $10,000. Additional options at 5.40% are available for longer durations into 2025 from NexBank and NASA Federal Credit Union.
Longer CDs Guarantee Your Rate Until 2026 or Beyond
Opting for a 2-year or longer CD term could be strategic, as U.S. interest rates may decline over the next few years. Lock in a promising 5.25% deal with Credit Human for 18 to 23 months, securing rates till spring 2026.
For extended security, consider a 3-year CD at 5.00%, ensuring a rate promise until 2027, or select high-4% rates for 4 to 5 years ahead.
Big U.S. Bank Leading CD Rates
If you prefer major banking institutions, note that BMO Alto, the online division of BMO, offers the top 5-year CD rate among big U.S. banks. While known for its 5-year rate, BMO Alto provides competitive options for CDs ranging from 6 months to 4 years.
CD Rates Are Still Near 20-Year Highs
After peaking at 6.50% in October, CD rates have moderated, but they remain significantly higher compared to the past two decades. Securing a 4% to 5% yield for a year or longer is still a lucrative opportunity.
While chasing the highest APY is enticing, consider the long-term strategy, especially anticipating substantial rate drops in 2024 and 2025. Locking in rates now could be prudent before potential declines.
Big Banks That Pay Attractive Rates
Although smaller banks and credit unions typically offer top CD rates, a notable exception is BMO Alto from a major U.S. bank. While excelling in the 5-year term, BMO Alto also provides competitive rates for various CD durations.
Jumbo CDs Offer a Rate Bump in Some Terms
State Bank of Texas and State Department Federal Credit Union headline jumbo CD offers, outperforming standard CDs with rates up to 5.50% and 5.41% APY, respectively.
While jumbo CD rates can surpass standard counterparts, always compare options, as standard CDs sometimes offer better rates. Make informed decisions by exploring both types.
Where Will CD Rates Go in 2024?
Following peak inflation, the Federal Reserve raised interest rates significantly, affecting CD rates positively. While rates have paused since July, future adjustments hinge on inflation trends.
Recent inflation data suggests a potential plateau in CD rates, awaiting further Fed decisions. Monitoring inflation trends is crucial, as rate adjustments could occur if inflation eases.
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Investopedia’s daily rate tracking involves over 200 banks and credit unions, identifying top-paying CDs in major terms. Eligible institutions must carry federal insurance, and CD deposits should not exceed $25,000.
For banks, availability in at least 40 states is essential. Credit unions included should have manageable membership criteria. Detailed methodology can be explored for insights into our rate selection process.