A 6% leader and four runners-up pay 5.75%
When you’re shopping for CDs, here are five top-rated options to help you secure a record return you can enjoy at least through next summer. The country’s leading interest rate remains 6.00% APR and is available for a term of one year American 1 Credit Union. But there are also four offers with a second-place interest rate of 5.75% APY and a term of nine to twelve months.
The central theses
- The top rate in our daily ranking of the best nationwide CDs remains at 6.00% APY for a 1-year certificate – the first nationwide CD to reach this threshold since the Fed began raising rates last year.
- Four CDs currently offer the next highest interest rate of 5.75% APY.
- Today’s number of CDs available nationwide that pay 5.50% APY or more increased by one to 46. The number was 30 two weeks ago.
- The best longer-term option with at least 5.00% is a 3-year CD with 5.23% APR.
- The Fed is widely expected to keep rates stable at its meeting in two weeks, but the probability of a Fed hike in November is currently around 45%.
To help you make as much money as possible, here are our partners best CD deals, followed by more information on the best paying CDs available to US customers anywhere.
Would you like to secure a record price in the longer term? You can earn 5.23% APY from the top performer in our Best 3 Year CDs ranking, or at least 5.00% from five other competitors in that period. The current maximum interest rates for 4- and 5-year maturities are now 4.81% APY and 4.86% APY, respectively.
If you have a jumbo size deposit, in some cases you can earn a little more than the standard rates. The highest Jumbo interest rate is currently 5.85% APY – available on a 6-month certificate that requires a minimum deposit of $100,000 – with additional options available at 1-year and 18-month terms Pay 5.80% APY.
Despite the assumption that a larger deposit is entitled to a higher return, this is not always the case with jumbo certificate prices, as they often yield less than standard CDs. Although today’s best jumbo deals, which typically require a deposit of $100,000 or more, outperform the best standard rates in five CD terms, you can do just as well with a standard CD in the other three terms or perform even better. Therefore, always research all certificate types before making a final decision.
Will CD prices go up this year?
The Fed has been aggressively tackling decades of inflation since last March, raising interest rates rapidly in 2022 and then making more moderate hikes in 2023. On July 26, the Fed raised interest rates for the 11th time in 12 meetings, a cumulative increase of 5.25%. As a result, the reference interest rate has risen to its highest level since 2001. This in turn leads to record interest rates for CD buyers and for anyone holding cash in a high-interest savings or money market account.
The Fed’s official announcement in July gave no clear indication of whether it will raise interest rates any further this year. The written statement merely reiterated the Fed’s commitment to bringing inflation back to its 2% target.
In a speech on August 25, Fed Chairman Jerome Powell said that further rate hikes were on the table if inflation did not fall sufficiently in the coming months or if economic growth was too fast (which would put upward pressure on inflation). Susan M. Collins, president of the Boston Federal Reserve, expressed similar sentiment this week, saying it was too early to say whether the Fed could end its rate-hiking campaign.
The Fed’s next meeting ends on September 20 and markets expect the central bank to almost certainly keep its key interest rate on hold this time. But the likelihood that the Fed will raise interest rates at its November meeting is currently estimated at about 45%.
Any further Fed hikes would certainly push CD rates a little higher. But the expected shutdown in September will leave markets – and CD buyers – guessing whether the pause will be temporary or permanent. Once the end of the Fed’s campaign becomes more confidently in sight, it will be a sign that CD rates have likely peaked.
Note that the “top rates” quoted here are the highest rates available nationwide, as identified by Investopedia in its daily interest rate research of hundreds of banks and credit unions. This differs significantly from the national average, which includes all banks that offer CDs with this maturity, including many large banks that pay low interest rates. Therefore, the national averages are always quite low, while the top prices you can find while shopping are often five, ten or even 15 times higher.
Disclosure of Tariff Collection Methodology
Each business day, Investopedia tracks rate data from more than 200 banks and credit unions offering CDs to customers across the country, and provides daily rankings of the best paying certificates for each key time period. To qualify for our listings, the institution must be federally insured (FDIC for banks, NCUA for credit unions) and the minimum CD 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 in order to become a member if you don’t meet other eligibility criteria (like not living in a specific area or working in a specific type of job). ), We exclude credit unions whose donation needs are $40 or more. For more information on how we select the best fares, see our full methodology.
Correction – Sept 2nd 2023: This article has been updated to reflect the previous day’s high price for a 3 year CD and the current high price for a 4 year jumbo CD.
Investopedia / Alice Morgan & Sabrina Jiang
https://www.investopedia.com/top-cd-rates-today-one-6-leader-and-four-runners-up-paying-5-75-7966839?utm_campaign=quote-yahoo&utm_source=yahoo&utm_medium=referral&yptr=yahoo A 6% leader and four runners-up pay 5.75%
