Our top picks for the best CD rates
If you're looking for a secure place to store your money and earn interest, a certificate of deposit (CD) could be a good option. Not sure where to start? We reviewed more than 400 data points to determine the best CDs available today across 6-month, 1-year, 18-month, and 2-year terms. Accounts were evaluated based on factors such as APY, minimum opening deposit, customer service, and more (see our full methodology here). Read on to learn more about our top picks for the best CDs.
Learn more about CDs
CDs are a type of deposit account that may or may not be the right fit depending on your unique savings goals. Before opting for a CD, it's important to fully understand how they work, the benefits and drawbacks of a CD, and where CD rates stand today.
An overview of CD rates today
The highest-paying CDs are currently offering APYs up to 4.35%, though these are only available at select banks. Nationally, the average interest rate on a 6-month CD is 1.41%, while the average 1-year CD earns 1.73%.
Average CD rates by term*
| TERM | RATE |
|---|---|
| 1 month | 0.23% |
| 3 months | 1.13% |
| 6 months | 1.41% |
| 12 months | 1.73% |
| 24 months | 1.61% |
| 36 months | 1.36% |
| 48 months | 1.28% |
| 60 months | 1.38% |
*As of September 21, 2026. Source: FDIC.
What are the different types of CDs?
CDs are not all structured the same way, and you might find that one type of CD works better for your savings strategy than another. Some of the most common types of CDs include:
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High-yield CD: A high-yield CD offers a higher rate than traditional CDs.
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No-penalty CD: This type of CD gives you the option to withdraw funds from your account before the maturity date without paying a penalty.
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Bump-up CD: These CDs allow you to take advantage of interest rate increases during the term. For example, say you opened your CD at 4.00% APY, but your financial institution raised that rate to 4.25% soon after. With a bump-up CD, you can request to increase your rate to the current one being advertised.
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Jumbo CD: Jumbo CDs typically offer a higher interest rate but require a higher minimum deposit than most other CD products — usually starting at $100,000.
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Callable CD: If interest rates fall, your bank may redeem a callable CD before its maturity date. In this case, you'd get your principal balance back, plus any earned interest up to that point.
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Brokered CD: Brokered CDs are purchased from a brokerage firm, rather than a bank. They are often higher risk than traditional CDs.
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Share certificate: A share certificate is essentially the same thing as a CD, except they're offered by credit unions.
Understanding CD early withdrawal penalties
Most CDs impose an early withdrawal penalty if you access your funds before the account reaches maturity. The exact amount of the penalty depends on the financial institution's policies and often the length of the CD term. This penalty is usually expressed as a certain number of days or months' worth of interest.
Pros and cons of CDs
Consider these important pros and cons of CDs before opening an account:
Pros
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CDs are a great intro to personal finance tools. Unlike the stock market, CDs offer safe, reliable returns with no rate changes.
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CDs offer fixed interest rates with higher returns on average compared with other deposit accounts.
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When you open a CD at a federally insured bank or credit union, that CD is insured up to $250,000.
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Opening a CD may discourage you from tapping into your savings early.
Cons
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You'll typically pay an early withdrawal penalty if you need your cash before the CD's maturity date.
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The competitive rates on CDs — especially longer-term CDs — might not keep up with inflation.
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The minimum balance needed to open a CD may be too high.
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Although CDs are safer, they offer lower returns than mutual funds and stocks.
What to do with a CD when it matures
When your CD matures, you have a few options for how to proceed. You might decide to renew your CD for the same term length at the current interest rate. You can also withdraw the funds and open a new CD with a different bank, put your money into a different type of savings account, explore new investment options, or use the money to fund a major purchase.
When your CD reaches maturity, your bank will likely give you a short grace period before automatically renewing your CD, during which time you should take action and make a decision about how to best use those funds.
How to set up a CD ladder
You may be worried about locking your money into a CD and missing out on higher interest rates in the future. And in an environment where interest rates are rising, missing out on a great rate is a real possibility.
CD laddering can help you avoid the risk of missing out on higher CD rates later. With a CD ladder, you split your savings among multiple CDs with staggered maturity dates (e.g., a 6-month CD, a 1-year CD, and a 2-year CD). When the first CD in your ladder matures, you can access those funds if you need them or roll the cash into a new CD — perhaps at a higher interest rate if one is available at that time. Meanwhile, your longer-term CDs will continue earning the rate you locked in when you opened them.
Alternatives to CDs
CDs are just one option for growing your savings. They can be a smart choice as part of a broader financial plan — especially if you're saving for a specific goal, want to lock in a competitive interest rate, and don't expect to need access to your money anytime soon. However, if flexibility is a priority, there are other savings options worth considering.
CDs vs. high-yield savings accounts
Both CDs and high-yield savings accounts offer secure ways to earn interest on your money, but they function differently. While both can provide competitive APYs, high-yield savings accounts allow you to access your funds more easily and without penalties. CDs, by contrast, require you to leave your money untouched for a set term; withdrawing funds early typically results in an early withdrawal penalty.
Learn more: High-yield savings account vs. CD
CDs vs. money market accounts
Both money market accounts and CDs are known for offering higher interest rates than traditional savings accounts. They're also both federally insured in most cases. However, CDs and money market accounts differ in a few key ways, including when it comes to fees, accessibility, and more.
Learn more: Money market account vs. CD
CDs vs. bonds
CDs and bonds are both considered low-risk places to put your money, but they function quite differently. Bonds may offer greater liquidity than CDs because you can sell them at any time, whereas CDs are locked in for the duration of the term. These two types of investments are also insured by different entities.
Learn more: CDs vs. bonds
CDs vs. Treasury bills
Another low-risk investment option, Treasury bills have become more popular in recent years. Also known as T-bills, these investments are backed by the U.S. government, offer competitive rates, and may be a more favorable option for short-term savers. Unlike CDs, T-bills provide greater liquidity and can be sold at any time.
Learn more: CDs vs. Treasury bills
CDs vs. fixed annuities
When saving for your golden years, choosing the right type of account can make all the difference. CDs and fixed annuities are both popular options for retirement savings because they're considered safe investments, offering fixed APYs or guaranteed minimum rates that can help you grow your nest egg.
Learn more: Fixed annuities vs. CDs
CDs vs. IRAs
Choosing between a CD and an IRA will require you to think carefully about your risk tolerance and how each account type fits into your savings timeline. While CDs are typically considered lower risk, IRAs give you the option to invest in higher-risk assets for the ability to earn higher returns over time. Ultimately, choosing between these two types of accounts will depend on how long you plan to keep your money in the account and how much you're willing to risk.
Learn more: CDs vs. IRAs
CDs. vs. mutual funds
Mutual funds can be a worthwhile alternative to CDs if you're looking for more flexibility and are comfortable taking on additional risk, especially during periods of market volatility. Unlike CDs, mutual funds can generally be sold at any time, allowing you to access your money without waiting for a fixed term to end.
Learn more: CDs vs. mutual funds
Best CD rates methodology
Our grading system, collected and carefully reviewed by our personal finance experts, comprised nearly 300 data points for approximately 60 federally insured CDs across 6-month, 1-year, 18-month, and 2-year terms. We used this data to develop our list of the best CDs.
We evaluated these accounts according to several key metrics, including annual percentage yield, minimum opening deposit, compounding frequency, and more.
The accounts on our list could earn a maximum of 25 points across all metrics. Here's a closer look at the categories we considered:
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Annual percentage yield (APY): Accounts with higher APYs were rewarded with more points than those with lower APYs. Note that rates on our list are current at the time of publishing but are subject to change at any time.
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Minimum opening deposit: Many CDs require a minimum deposit to open an account. Accounts with no or low minimum deposit requirements ranked more favorably than those with higher opening deposit requirements.
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Compounding frequency: Compounding can occur daily, monthly, quarterly, or even annually. We awarded more points to accounts that compound interest frequently.
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Customer service contact methods: Our team awarded one point for every contact method available to customers (phone, email, chat).
