Boost Your Savings with 5% Interest CDs: A Smart Guide
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- Several banking entities offer certificates of deposit with an annual percentage yield of 5% or more.
- The interest rates for certificates of deposit with durations less than 24 months are presently above those for most long-term CDs.
- Examine the account statement prior to initiating a certificate of deposit to understand the necessary steps for opening and associated fees.
Opening a certificate of deposit (CD) can be an effective method for securing steady growth on your savings.
Currently, the highest average CD rate A 12-month Certificate of Deposit (CD) offers an Annual Percentage Yield (APY) of 1.80%, as reported by the Federal Deposit Insurance Corporation (FDIC). However, numerous banks and credit unions provide CDs with significantly higher yields.
Some of the best CD rates continue to pay an annual percentage yield of at least 5%. Discover where you can locate CDs that offer a 5% interest rate.
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Here are some of the highest savings and certificate of deposit (CD) rates provided by major nationwide banks.
| Account Name | The APY rates (Annual Percentage Yields) are correct as of February 20, 2025. | Minimum Account Opening Balance |
| LendingClub LevelUp Savings Account | up to 4.50%* | $0 |
| Valley National Bank High-Yield Saving Account | 4.39% | $1 |
| Top Bank Imagine Savings Account | up to 4.35% | $0 |
| Barclays 6-Month Online Certificate of Deposit | 3.80% | $0 |
| SkyOne Federal Credit Union 3-Month Certificate of Deposit, offered through Raisin | 4.00% | $1 |
| Sallie Mae 14-Month CD with No Early Withdrawal Penalty | 3.95% | $1 |
| Discover 1 Year CD | 4.00% | $0 |
| Bread Savings 2-Year High-Yield Certificate of Deposit | 4.00% | $1,500 |
| Discover 18 Month CD | 4.00% | $0 |
| SkyOne Federal Credit Union 3-Year Certificate of Deposit | 4.00% | $1 |
CDs offering at minimum a 5% interest rate
Here’s a list featuring various local and national financial organizations where you can find certificates of deposit (CDs) offering an annual percentage yield (APY) of at least 5.00%. To become part of the mentioned credit unions, you must satisfy their membership criteria. Additionally, certain banks could have restrictions, only providing services to residents within particular regions.
This list particularly encompasses terms that are less than 24 months old because At present, short-term CD rates exceed those of long-term CDs. .
| Institution | Most Competitive CD Term | Highest CD APY Available | Minimum Opening Account Balance | Area of Operation |
| 5 months | 9.50% | $500 | Parts of California | |
| 8 months | 6.00% | $1,000 | Parts of California | |
| 3 months | 5.10% | $2,500 | Boca Raton, Florida | |
| 18 months | 5.00% | $500 | Parts of Utah |
Where can you locate the highest 5% CD rates?
The highest certificate of deposit (CD) interest rates are typically offered by online banks and credit unions. When comparing different CDs, ensure they have similar maturity periods to identify the most favorable rate; however, also consider any possible penalties or fees. early withdrawal penalties as well.
When examining certificates of deposit (CDs) from various banks, ensure you review the account disclosures to grasp the initial requirements and restrictions associated with the account.
At many banks, CDs might necessitate a minimum initial deposit of $1,000 or higher. Without obtaining one with lower requirements, you could face this obstacle. add-on CD , you won't be able to deposit money after account opening. Make sure you're able to part ways with the money you're investing in a CD for the specified timeframe. A high APY won't have much of an impact on your savings growth if you have to make an early withdrawal.
CDs do not possess anything monthly bank maintenance fees However, they typically come with early withdrawal penalties if you remove funds before the end of the term.
Enhancing your earnings within a 5% CD environment
Currently, short-term certificates of deposit—those maturing within 18 months or less—are offering marginally higher interest rates compared to their longer-term counterparts.
Typically, banks are now offering reduced annual percentage yields (APY) on long-term certificates of deposit (CDs) as the Federal Reserve anticipates lowering interest rates soon. It might be necessary to opt for a shorter-term CD initially to secure better returns before reassessing your financial plan upon maturity.
Should interest rates remain more favorable on certificates of deposit (CDs) compared to high-yield savings accounts, you might consider opening an additional short-term CD. Alternatively, you could choose to invest your funds in the stock market for a possibly greater return, based on your financial objectives.
5% interest CD FAQs
Is it simple for me to locate CDs with a 5% interest rate?
Indeed, at present, four banking institutions are providing certificates of deposit with an annual percentage yield (APY) of 5% or higher. For instance, you can look into options from Financial Partners Credit Union and California Coast Credit Union.
Is it safe to invest in CDs offering a 5% interest rate?
CDs that are FDIC - or insured by NCUA are secure.
Are all certificates of deposit with a 5% interest rate required to have large minimum deposits?
Not every CD offering a 5% interest rate requires a large initial deposit. There are several options for 5% CDs where you only need as little as $500 or even just $1,000 to open an account.
Should I secure a long-term CD at a 5% interest rate, or should I hold off?
In September, the Federal Reserve lowered interest rates for the first time in four years, followed by additional cuts in both November and December. However, they decided to maintain stable interest rates in January. next Fed meeting It’s probable that interest rates will remain steady, but the Federal Reserve could potentially lower them at some point in the future. This might be an opportune moment to secure a comparatively higher interest rate through a certificate of deposit (CD) before rates drop and these attractive yields disappear.
Is it preferable to put money into a 5% certificate of deposit or a high-yield savings account?
You'll earn more interest over time in a CD than in a high-yield savings account, but you won't be able to access your money without paying a penalty. Use a high-yield savings account if you need easy access to your funds.
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