Best CD Rates Today, September 10, 2024: Take Advantage of High APYs Before the Fed Cuts Rates

The Federal Reserve is poised to cut rates next week, but there’s still time to earn high returns with a certificate of deposit. Today’s best CDs have annual percentage yields, or APYs, of up to 5.25% — more than twice as high as national average for some terms. And by opening one of these CDs now, you can lock in a great APY and protect your income from expected interest rate declines.

With inflation cooling, the Fed is expected to cut interest rates at its upcoming Sept. 17-18 meeting, meaning CD rates are likely to fall as well. Many banks have already begun cutting APYs in anticipation of that. So the sooner you open a CD, the better your earning potential could be.

Here’s where you can score a top APY today.

Today’s Best CD Rates

Here are some of the highest CD interest rates today and how much you can earn by depositing $5,000 now:

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

What the Fed’s Next Move Means for CD Rates

The Fed regularly adjusts the federal funds rate to stabilize the economy. When inflation is high — and it has been for years — the Fed raises the rate to discourage borrowing and reduce consumer spending in the hopes that will lower prices. The federal funds rate determines how much it costs banks to lend and borrow money to each other, so when the Fed raises the rate, banks typically raise the APYs on consumer products like CDs and savings accounts.

Starting in March 2022, the Fed raised rates 11 times to combat skyrocketing inflation, and CD yields skyrocketed. As inflation began to show signs of cooling, the Fed held rates steady eight times starting in September 2023, and APYs also remained largely flat.

Over the past few months, APYs have been fluctuating as banks anticipate a rate cut, which the Fed has indicated could happen this month. And with the latest inflation report showing inflation tracking in line with expectations, that cut seems even more likely. We’ve seen banks cut APYs more and more frequently in recent weeks as a result.

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

If the Fed does indeed cut rates next week as expected, CD APYs are likely to fall even further.

These conditions currently offer the best rates

Typically, long-term CDs pay more than short-term CDs because banks want to encourage you to keep your money with them for a longer period of time. But we currently have what’s known as an inverted yield curve, which means shorter terms pay more. That’s because banks don’t want to lock customers into a high APY for years when rate cuts could be just around the corner.

“For the time being, short-term CD rates will continue to be higher than long-term rates because banks don’t want to get caught paying higher rates than they can get on the open market because they want to profit from the spread,” said Dana Menard, CFP, founder and chief financial planner at Wealth Management Strategies in the Twin Cities“It makes sense that banks would want to reduce their risk by lowering long-term rates until they know what the Fed is going to do. [in] September.”

That said, APYs are still high across all maturities, so if you’re looking for a long-term CD, opening one now may be a smart move.

“For an individual, it’s a matter of what’s most important and what are his other investment options,” says Bobbi Rebell, Certified Financial Planner® and Personal Finance Expert at BadCredit.org“The shorter-term CD gives them a higher yield, but the longer-term CD — while a lower yield than the shorter-term one right now — may be higher than the same product they buy in the future. In other words, even though the longer-term interest rate is lower relative to the shorter-term one, the market is predicting that it is still likely to be higher than that same rate will be in the future.”

What to look for in a CD (besides APY)

When you’re comparing your CD options, a competitive APY is important. But it’s not the only thing you should consider. To find the right account for you, you should also consider these things:

• When you need your money: Early withdrawal penalties can eat into your interest earnings, so choose a term that fits your savings timeline. You can also opt for a penalty-free CD, although the APY may not be as high as a traditional CD with the same term.
• Minimum deposit requirement: Some CDs require a minimum amount to open an account — typically $500 to $1,000. Others don’t. How much money you need to put aside can help narrow down your options.
• Costs: Maintenance and other fees can eat into your earnings. Many online banks don’t charge fees because they have lower overhead costs than brick-and-mortar banks. However, read the fine print for any account you evaluate.
• Federal deposit guarantee: Make sure any bank or credit union you consider is a member of the FDIC or NCUA so your money is protected if the bank goes bankrupt.
• Customer ratings and reviews: Visit sites like Trustpilot to see what customers are saying about the bank. You want a bank that is responsive, professional and easy to work with.

Methodology

CNET rates 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, and Connexus Credit Union.