The economic headlines are concerning this week, but opening a certificate of deposit can help protect your money. While the Federal Reserve held interest rates steady at last week’s meeting, a dismal July labor report triggered recession fears and stock market panic. As a result, some economists are calling for the Fed to make an emergency interest rate cut before its next meeting in September. And with CD rates already falling over the past several weeks, the sooner you open a CD, the better your earning potential could be.

Today’s best CDs offer annual percentage yields, or APYs, up to 5.30%. By opening one of these accounts today, you can lock in a high APY and protect your earnings against future rate drops. Here’s the latest on CD rates and what to expect next.

Today’s best CD rates

Here are some of the top rates available on today’s best CDs and how much you could earn by depositing $5,000 right now:

TermHighest APYBankEstimated earnings6 months5.30%Bask Bank, CommunityWide Federal Credit Union$130.791 year5.25%Bask Bank$262.503 years4.55%NexBank$714.025 years4.45%BMO Alto$1,216.02APYs as of Aug. 7, 2024, based on the banks we track at CNET. Earnings are based on APYs and assume interest is compounded annually.

Experts recommend comparing rates before opening a CD account to get the best APY possible. Enter your information below to get CNET’s partners’ best rate for your area.

Why CD rates are on the way down

The Fed regularly adjusts the federal funds rate to stabilize the economy, which determines how much it costs banks to borrow and lend money to each other, so banks tend to follow the Fed’s lead. 

We saw banks push interest rates higher when the Fed raised rates. When the Fed held rates steady, some banks held rates steady for weeks while others quietly lowered select terms. 

Fed Chair Jerome Powell said a “rate cut could be on the table at the September meeting,” meaning now’s the time to lock in a competitive rate. Once the Fed makes moves to drop rates, CD rates will likely drop further.  

So the sooner you lock in a high APY, the greater your earning potential could be.

“Since rates are high, locking in now could be a smart move,” said Bola Sokunbi, a CNET Money expert review board member and founder of Clever Girl Finance. 

Which CD should you choose? Short-term rates for certificates of deposit will let you have access to your money sooner, while a long-term CD lets you lock in a fixed rate for a guaranteed return. Sokunbi recommends investing in a combination of both through CD laddering, which helps spread out your risk and optimize returns.

Here’s where CD rates stand compared to last week:

TermCNET average APYWeekly change*Average FDIC rate6 months4.68%No change1.81%1 year4.89%-0.41%1.85%3 years4.08%-0.73%1.44%5 years3.94%-1.00%1.43%APYs and FDIC average as of Aug. 5, 2024. Based on the banks we track at CNET.*Weekly percentage increase/decrease from July 29, 2024, to Aug. 5, 2024.

What to look for in a CD

A competitive APY is important, but there are other things you should consider when comparing CDs to get the best product for your needs:

When you’ll need your money: Early withdrawal penalties can eat into your interest earnings. So, be sure to choose a term that fits your savings timeline. Alternatively, you can select a no-penalty CD, although the APY may not be as high as you’d get with a traditional CD of the same term.
Minimum deposit requirement: Some CDs require a minimum amount to open an account -- typically, $500 to $1,000. Others do not. How much money you have to set aside can help you narrow down your options.
Fees: Maintenance and other fees can eat into your earnings. Many online banks don’t charge fees because they have lower overhead costs than banks with physical branches. Still, read the fine print for any account you’re evaluating.
Federal deposit insurance: Make sure any bank or credit union you’re considering is an FDIC or NCUA member so your money is protected if the bank fails.
Customer ratings and reviews: Visit sites like Trustpilot to see what customers are saying about the bank. You want a bank that’s responsive, professional and easy to work with.

Methodology

CNET reviews CD rates based on the latest APY information from issuer websites. We evaluated CD rates from more than 50 banks, credit unions and financial companies. We evaluate CDs based on APYs, product offerings, accessibility and customer service.

The current banks included in CNET’s weekly CD averages are: Alliant Credit Union, Ally Bank, American Express National Bank, Barclays, Bask Bank, Bread Savings, Capital One, CFG Bank, CIT, Fulbright, Marcus by Goldman Sachs, MYSB Direct, Quontic, Rising Bank, Synchrony, EverBank, Popular Bank, First Internet Bank of Indiana, America First Federal Credit Union, CommunityWide Federal Credit Union, Discover, Bethpage, BMO Alto, Limelight Bank, First National Bank of America, Connexus Credit Union.