Today’s certificate of deposit (CD) rates of interest are a few of the highest we’ve seen in greater than a decade due to several rate hikes by the Federal Reserve. Nevertheless, the Fed finally cut its goal rate in September, so now might be your last probability to lock in a competitive rate.

CD rates vary widely across financial institutions, so it’s necessary to make sure you’re getting the perfect rate possible when shopping around for a CD. The next is a breakdown of CD rates today and where to seek out the perfect offers.

Historically, longer-term CDs offered higher rates of interest than shorter-term CDs. Generally, it’s because banks would pay higher rates to encourage savers to maintain their money on deposit longer. Nevertheless, in today’s economic climate, the other is true.

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As of November 17, 2024, CD rates remain high by historical standards. Nevertheless, the best CD rates will be found for shorter terms of around one yr or less.

Today, the best CD rate is 4.50% APY, offered by Barclays Bank on its 6-month CD. There is no such thing as a minimum opening deposit required.

Here’s a take a look at a few of the perfect CD rates available today from our verified partners:

The quantity of interest you possibly can earn from a CD is dependent upon the annual percentage rate (APY). This can be a measure of your total earnings after one yr when considering the bottom rate of interest and the way often interest compounds (CD interest typically compounds every day or monthly).

Say you invest $1,000 in a one-year CD at 1.88% APY. At the tip of that yr, your balance would grow to $1,018.96 — your initial $1,000 deposit, plus $18.96 in interest.

Now let’s say you select a one-year CD that gives 5% APY as an alternative. On this case, your balance would grow to $1,051.16 over the identical period, which incorporates $51.16 in interest.

The more you deposit in a CD, the more you stand to earn. If we took our same example of a one-year CD at 5% APY, but deposit $10,000, your total balance when the CD matures can be $10,511.62, meaning you’d earn $511.62 in interest. ​​

Read more: What’s CD rate?

When selecting a CD, the rate of interest is often top of mind. Nevertheless, the speed isn’t the one factor it is best to consider. There are several varieties of CDs that provide different advantages, though chances are you’ll need to just accept a rather lower rate of interest in exchange for more flexibility. Here’s a take a look at a few of the common varieties of CDs you possibly can consider beyond traditional CDs:

• Bump-up CD: Such a CD means that you can request the next rate of interest in case your bank’s rates go up throughout the account’s term. Nevertheless, you’re often allowed to “bump up” your rate only once.

• No-penalty CD: Also generally known as a liquid CD, style of CD gives you the choice to withdraw your funds before maturity without paying a penalty.

• Jumbo CD: These CDs require the next minimum deposit (often $100,000 or more), and sometimes offer higher rate of interest in return. In today’s CD rate environment, nevertheless, the difference between traditional and jumbo CD rates might not be much.

• Brokered CD: Because the name suggests, these CDs are purchased through a brokerage relatively than directly from a bank. Brokered CDs can sometimes offer higher rates or more flexible terms, but in addition they carry more risk and may not be FDIC-insured.