CD shoppers looking to make a big deposit have a new option today to earn a first class rate, with Credit One Bank Launch of a 15-month certificate paying 5.65% APY. It’s not the highest yield you can earn on a mega CD, however Sun East Federal Credit UnionThe industry leading APY rate of 5.75% is only available for the shorter term of 11 months.
The Benchmark Leader CD count – which pays a high-level rate of at least 5.50% APY – also rose today to 22 from 21, while the market-leading rate across all benchmark CD terms held steady at 5.75% APY, available for 9. months of Andrews Federal Credit Union.
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- New CD has been at the top of our mega-hit rankings for 18 months, paying 5.65% APY.
- The highest rate nationwide on a CD for any term remains 5.75% APY, and it’s available as a standard 9-month CD or a jumbo 11-month CD.
- The number of “normative leaders” in our daily ranking of the best CD rates, who pay at least 5.50% APY, has increased by one today, to 22.
- The longest period you can earn at least 5.00% is three years, at a rate of 5.13% APY. But if you have a high volume deposit, you can get a 4-year term at 5.12% APY.
- The Fed’s next rate meeting won’t last for nearly six weeks, and it’s not certain whether it will raise the federal funds rate – and therefore cash deposit rates – again this year.
To help you earn as much as possible, here are the best CD prices available from our partners, followed by more information about the most profitable CDs available to US customers everywhere.
Do you want to hold one of today’s high prices for a long time? You have two long-term options offering at least 5.00%. You can get 5.13% APY with the leader in our ranking of the best 3-year CDs, or if you have a minimum of $100,000 to deposit in a mega CD, you can extend that to four years at a similar rate of 5.12% APY.
CD Shopper Tip
If you think you need to hold on to a banking CD because membership in a credit union seems like a big deal, think again. The credit unions that we include in our rankings are open to anyone nationwide and easy to join. Although some require a donation to an affiliated nonprofit organization, the amount required is generally modest, and some require no donation or cost at all. The process for opening an account with a credit union is also the same as opening an account with a new bank.
Be careful
Although it is suggested that a larger deposit entitles you to a higher payout, this is not always the case for hefty certificate rates, which often pay less than standard CDs. Although today’s best jumbo deals, which typically require a deposit of $100,000 or more, beat standard best rates in five conditions on CDs, you can do just as well or better in the other three terms with a standard CD. So always make sure to shop around each certification type before making a final decision.
Will CD prices go up this year?
CD rates are already at record highs, but they could be even higher. That’s because the Fed announced another 0.25% increase in the federal funds rate on July 26th, and it will remain at that level until at least September 20th. Credit unions are willing to pay customers for their deposits.
Since March 2022, the Fed has been aggressively battling decades-high inflation, with 11 hikes to the federal funds rate over the past 12 meetings. With the latest bump, the cumulative increase totaled 5.25% and took the federal funds rate to its highest level since 2001. That created excellent conditions for CD shoppers, as well as for anyone with cash in a high-yield savings account or in the money market.
The Fed’s official announcement in July did not provide any strong indications as to whether it would raise the benchmark interest rate higher than this year. The written statement simply reiterated the Fed’s commitment to lower inflation to its target of 2%.
In his post-announcement press conference, Fed Chairman Jerome Powell noted that the rate-setting committee had not yet made any decisions about raising rates again in 2023, or if so, what the timing or speed of any increases would follow. He specifically mentioned that both a hike and a halt were potential at the next meeting, scheduled for September 19-20.
Three Fed governors have made public statements over the past week about their expectations on whether the committee will raise or suspend interest rates in the future. Two stressed the need to monitor upcoming data and decide on a meeting-by-meeting cycle, including the possibility of implementing a further increase. But the third indicated that unless something unexpected appears in the data, he expects rates to be kept without any further increases.
Since their remarks, new monthly inflation data have been released, with yesterday’s report showing that core inflation is cooling down. While the Fed will also be looking at other economic indicators between now and its next meeting, this week’s inflation news could lead to the Fed pausing the interest rate, rather than raising it again, in September.
For now, the rally in July is likely to push CD prices a little higher. Then again, most of the impact could already be behind us, given that the Fed’s move was almost certain weeks in advance, and many banks and credit unions have already boosted their rates. In any case, when the Fed finally looks set to pause its rate hike campaign for good, it will signal that CD rates have peaked.
Note that the “higher rates” listed here are the highest rates available nationwide that Investopedia has determined in its daily rate search on hundreds of banks and credit unions. This is very different from the national average, which includes all banks that offer a CD with that term, including many of the larger ones that pay minuscule interest. Thus, the national rates are always very low, while the higher rates that you can find out by shopping around are often five, 10 or even 15 times higher.
Disclosure of the price collection methodology
Every business day, Investopedia tracks pricing data for more than 200 banks and credit unions that offer CDs to customers across the country and determines daily ratings for the highest-paying certificates in each key term. To qualify for our listings, an organization must be federally insured (FDIC for banks, NCUA for credit unions), and the minimum initial CD deposit must not exceed $25,000.
Banks must be available in at least 40 states. And although some credit unions require you to make a donation to a specific charity or association to become a member if you don’t meet other eligibility criteria (for example, you don’t live in a certain area or work in a certain type of job), we exclude credit unions whose donation requirements are $40 or more. For more information on how to choose the best rates, read our full methodology.
