Certificates of deposit (CDs) are a good option if you want a low-risk investment that will earn income on cash you don’t need immediately. Based on Curinos data, CD rates have been relatively stable over the past week as the Federal Reserve paused its rate hike policy.
| CD RATES TODAY | ||
|---|---|---|
Term | Average APY | High rate |
3-month CD | 1.30% | 5.39% |
6-month CD | 1.86% | 5.27% |
1-year CD | 1.98% | 5.37% |
2-year CD | 1.71% | 4.88% |
3-year CD | 1.62% | 4.67% |
Source: Curinos. Data accurate as of August 9, 2024. Quoted rates are based on a $25,000 deposit.
Three-month CD rates
Rates on three-month CDs have remained the same from a week ago. The national average rate was 1.30% as of August 9, 2024, the latest data available, the same as the previous week and up one basis point from a month prior.
The current national high for a three-month CD is 5.39%, which would earn more than $330 in interest with a $25,000 deposit.
Six-month CD rates
When you opt for leading six-month CDs, you get a winning combination: solid interest rates and a commitment that’s only short-term.
The national average APY for six-month CDs is 1.86%, up from 1.83% last week and 1.82% one month ago.
The current top national rate for a 6-month CD is 5.27%, according to the data available from Curinos’ database. But you may be able to find better deals by shopping around.
You’d earn almost $660 in interest if you put $25,000 in a six-month CD with a rate of 5.27%.
One-year CD rates
If you’re willing to lock away your savings for 12 months, you can pick up even better rates. One-year CDs can give you returns as high as, or even higher than, longer-term options.
Rates on 12-month CDs are decreasing. The national average APY is 1.98%, down one basis point from last week and from a month before.
The current national high for a 12-month CD is 5.37%, which would earn around $1,340 in interest with a $25,000 deposit.
Two-year CD rates
Rates on two-year CDs have declined over the past month.
The national average APY is 1.71%, a decrease of one basis point from last week and down one basis point from one month ago.
The current national high for a 24-month CD is 4.88%. Locking in a rate close to this high will maximize your returns on this longer-term investment.
If you invest $25,000 in a 24-month CD at the high rate of 4.88% you’d earn roughly $2,500 in interest.
Three-year CD rates
The national average APY for a three-year CD stands at 1.62%, which is down one basis point from last week and from 1.63% a month ago.
The highest rate was 4.67%, which would net almost $3,669 in interest if you invested $25,000.
Methodology
To establish average certificate of deposit (CD) rates, Curinos focused on CDs intended for personal use. CDs that fall into specific categories are excluded, including promotional offers, relationship-based rates, private, youth, senior, student/minor, affinity, bump-up, no-penalty, callable, variable, step-up, auto transfer, club, gifts, grandfathered, internet-only and IRA CDs. The average CD rates quoted above are based on a $25,000 deposit.
Frequently asked questions (FAQs)
CD rates increased throughout 2022 and 2023 after the Federal Reserve raised short-term interest rates to stymie sky-high inflation. More recently, though, CD yields have plateaued as the rate of price gains has come down and the Fed has remained in a holding pattern. Once the Fed starts cutting rates, which could happen by the Fall, average CD yields could come down, as well.
You’ll need a few key details to open a CD: your name, address, Social Security number, government-issued ID and phone number. You can open a CD online or in person, but you’ll probably find better rates online. Once you get the green light, you can fund the CD with cash from a linked bank account or one that’s not affiliated with the bank at all.
CD rates change on a regular basis, but the higher the better. As of August 9, 2024, the national average interest rate for a 12-month CD sat at 1.98% APY, according to data from Curinos. But you can find plenty of banks advertising APYs well above this average, especially if you take a look at the top contenders in our ranking of the best CD rates.
A basis point is the term used to describe one hundredth of one percentage point. Therefore, if the yield on a CD increased from 1.50% to 1.60%, it increased by 10 basis points.
