What is a good CD interest rate?


CDs offer significantly higher interest rates than traditional savings accounts.

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Although recent interest rate hikes hurt potential buyers, as well as homeowners looking to refinance, the news isn’t so bad. Due to the activity of the Fed, the profits of high yield savings And certificates of deposit (CD) accounts grew exponentially.

Both types of accounts come with unique perks and benefits, many of which are particularly appealing in today’s economic climate. Many account holders may seek any advantage they can get and since the average savings account interest rate hovers around 0.33%, they do not get the help they need by keeping their money intact.

Fortunately, a deposit account certificate can help protect and grow your money, assuming you get a favorable interest rate. In order to get the most out of these types of accounts, it is first useful to understand what a good CD interest rate is.

You can easily check today’s CD interest rates to determine if this is right for you or simply use the table below to explore some local options.

What is a good CD interest rate?

As with interest rates on savings accounts and high yield savings accounts, the higher the interest rate, the better it is generally. To determine what a “good” rate is, just compare what CDs currently offer to what you can get with a regular savings account.

Savings accounts are currently hovering around 0.33% while interest rates on CDs are hovering between 3.5% and 4.5% or more depending on the lender and other factors. Now is the perfect time to open a deposit account certificate. Simply put: if you’re not putting money into a CD or some other form of high interest account, you’re leaving money on the table.

Just be sure to shop around before you sign on the dotted line. By researching all viable options, you will increase your chances of getting the highest rate. But be sure to watch the fine print. Some banks may charge you fees or penalties that may lower your interest rate. It could be the difference between a lender offering a high rate and a lender offering a lower rate with no fees.

Explore your online CD options now to see how much more you could earn.

Advantages of the CD to know

Higher interest rates are not the only advantage offered by certificates of deposit accounts. Here are two other major benefits that anyone considering buying a CD should be aware of:

  • Block your rate: You may be able to earn more interest with a high-yield savings account or other savings vehicle, but this will likely only be temporary. This is because interest rates on high yield savings accounts are not locked in and will rise or fall based on market and Fed activity. A CD doesn’t work that way – the interest rate you get when you open the account will be the same as that charged for the duration of the CD. So don’t worry about market activity, with a CD your money will earn interest no matter what happens in the market.
  • Protects your money: Not only will a CD protect you against an unfavorable rate environment, it will also protect your principle by locking in your money for the duration. Account holders will not be able to access the money unless they are willing to pay a penalty to get it. So if you’re struggling to save money, a CD might be worth it. The money you deposit will be the same amount of money you withdraw at the end of the term (plus any interest you have earned).

Explore your CD options now to get started!

The bottom line

Those looking to both protect and grow their money should seriously consider opening a CD. These types of accounts currently offer exponentially higher interest rates than those that come with traditional savings accounts. But the benefits don’t stop there. They are also reliable because the interest rate you get when you sign up will be the interest rate honored for the duration of the CD. And because you won’t be able to access it without penalty, you can rest assured that your money is safe (and growing) without interruption.



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