Consultant

CDs Are Still Smart—Paying Mid-4% Returns You Can Lock in for Months or Even Years

July 3, 2025

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Key Takeaways

The Fed is expected to cut its federal funds rate at least once in 2025.
Once a Fed rate cut becomes likely, the best CD rates may drop in anticipation.
It’s not too late to open CDs—their rates are still strong, and they offer locked-in returns guaranteed for months or even years.

The full article continues below these offers from our partners.

Don’t Miss Out: CDs Still Pay Strong Returns—With a Guarantee

Now is a great time to consider a certificate of deposit (CD). Though CD rates dipped when the Federal Reserve cut its benchmark interest rate three times in late 2024, dropping it from a 23-year high, the best CDs still offer an excellent return on your cash: up to 4.60% as of this writing.

And the rate you lock in with a CD is guaranteed for the duration of its term—whether that’s through this year, into 2030, or somewhere in between. Because the annual percentage yield (APY) on your CD won’t change, unlike rates for high-yield savings accounts, your return is predictable and risk-free when the CD is issued by a federally insured bank or credit union.

The Best CDs Pay Up to 4.60% APY—And Here’s Where to Find Them

It’s often wise to look beyond your current bank or credit union to find the most competitive CD rates. The average rate for a 1-year CD is 1.62%, for example, according to the FDIC. But as our tables below show, there are dozens of options that pay much better than the national average rates.

In addition to rates, consider your financial timeline when choosing a CD, so the term you choose fits your needs and you’re not likely to need the money before the CD matures. Though you can cash in a CD during its term if needed, you’ll face an early withdrawal penalty, which will likely negate the good return you’d otherwise receive. (If you are nervous about committing, these CDs offer mild early withdrawal penalties.)

As you’re shopping around, consider the idea of putting savings into more than one CD. Stashing cash into certificates of different lengths—one with a shorter term length and one with a longer timeframe, for example—lets you benefit from higher rates now while maintaining access to some of your cash sooner.

Here are the top nationwide CDs, broken down by term length:

CDs With Rates Guaranteed Through 2026
Institution	APY	Term	Minimum Opening Balance
Northern Bank Direct	4.60%	6 months	$500
NASA Federal Credit Union	4.59%	9 months	$10,000
SouthEast Bank	4.50%	6 months	$1,000
Liberty Federal Credit Union	4.50%	6 months	$1,000
Communitywide Federal Credit Union	4.50%	6 months	$1,000
Newtek Bank	4.50%	6 months	$2,500
ableBanking	4.50%	6 months	$5,000
Paramount Bank	4.50%	7 months	$1,000
Presidential Bank	4.50%	7 months	$1,000
Partners 1st Federal Credit Union	4.50%	9 months	$500
Northern Bank Direct	4.50%	9 months	$500
Abound Credit Union	4.50%	10 months	$500
Genisys Credit Union	4.50%	13 months	$500
NASA Federal Credit Union	4.45%	15 months	$10,000
Brilliant Bank	4.30%	15 months	$1,000
Sallie Mae Bank	4.30%	15 months	$2,500

(Source: Investopedia daily rates data)

Why It’s Smart to Lock in a CD Soon—Before a Fed Cut Drives APYs Lower

The Fed is expected to cut its federal funds rate at least once in 2025. According to the CME Group’s FedWatch Tool, which uses the prices of fed funds futures to predict how the Fed might change interest rates, there’s currently a greater than 65% chance that the central bank will lower its benchmark rate following its mid-September meeting.

But don’t wait until the Fed announces a rate cut, because as soon as a reduction appears likely, financial institutions will start adjusting their CD rates in anticipation. That means now is a good time to open a CD, guaranteeing you can earn today’s rate for months or years into the future—regardless of the timing and frequency of the Fed’s rate cuts.

Daily Rankings of the Best CDs and Savings Accounts

We update these rankings every business day to give you the best deposit rates available:

Important

Note that the “top rates” quoted here are the highest nationally available rates Investopedia has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often 5, 10, or even 15 times higher.

How We Find the Best Savings and CD Rates

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs and savings accounts to customers nationwide and determines daily rankings of the top-paying accounts. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the account’s minimum initial deposit must not exceed $25,000. It also cannot specify a maximum deposit amount that’s below $5,000.

Banks must be available in at least 40 states to qualify as nationally available. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our
editorial policy.

Federal Deposit Insurance Corporation. “National Rates and Rate Caps — June 2025.”
CME Group. “FedWatch.”

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