Key Takeaways
- With it appearing likely the Federal Reserve is finished raising interest rates, CD yields have begun to come down from their historic November peak.
- But three large U.S. banks—Wells Fargo, Marcus by Goldman Sachs, and Ally—have moved the other way with at least one CD each.
- Their increased rate offers range from terms of 6 months to 1 year.
- Want to earn top dollar? Smaller banks and credit unions still pay the highest rate in every CD term.
- Your deposits at an FDIC bank or NCUA credit union are equally protected no matter the institution’s size.
The Best CD Rates Have Been Dropping
It’s been a banner year for those with cash in the bank, thanks to the Federal Reserve’s aggressive fight against inflation. By raising interest rates a cumulative 5.25% since March 2022—to the highest level in 22 years—the central bank has also pushed up the returns you can earn on savings, money market, and certificate of deposit (CD) accounts.
But the CD rate party is now winding down, with the Fed signaling last week that its rate-hike campaign is now most likely finished. Though the Fed committee has so far opted to maintain the federal funds rate at its historic high, the prospect of more than one rate cut in 2024 looms large—and as a result, many banks and credit unions have started taking their foot off the gas on CD rates.
Indeed, October saw the top rate in our daily ranking of the best nationwide CDs reach an eye-popping 6.50% APY. And in early November, the number of nationally available CDs paying a rate of at least 5.75% APY ballooned to 18. But since then, the rates in our rankings have started to soften, with only three CDs remaining above the 5.75% APY mark.
These Five Big-Bank Rates Have Gone Up Instead
The general downtrend in CD rates makes these newly offered rates surprising. While almost every CD rate move we’ve seen over the last few weeks has been a decrease, these three banking giants with familiar names have instead opted to sweeten the deal on one or more certificates.
- Wells Fargo: Wells Fargo is the nation’s third-largest bank by total domestic deposits (behind Chase and Bank of America. While it had already been paying 5.00% APY on an 11-month CD special, that offer has been boosted for customers in certain zip codes, who can now earn 5.25% APY on 11 months with a $5,000 minimum deposit.
- Marcus by Goldman Sachs: As the online consumer banking arm of Goldman Sachs, Marcus recently raised three CD rates. Its 6-month rate moved from 5.10% to 5.25% APY, its 9-month rate was raised from 5.15% to 5.30% APY, and on a 12-month CD, you can now earn 5.50% instead of the previous 5.30% APY. All Marcus CDs require a minimum deposit of $500.
- Ally Bank: Ally is the largest online-only bank, in addition to the 20th largest U.S. bank overall. It recently upped its 1-year CD rate from 5.10% to 5.25% APY and accepts any deposit amount.
The Best Rates Still Come from Smaller Players
For anyone wanting to lock in the highest rate possible, better offers continue to be available at smaller banks and credit unions. Though it may seem safer to stick with a brand-name bank, the truth is that your deposits at any FDIC bank or NCUA credit union are equally protected—covering up to $250,000 in deposits per person, per institution. Coverage does not vary based on bank or credit union size.
CDs also present an ideal opportunity for stashing your cash elsewhere, given a CD’s “park it and forget it” nature. Generally, you will meaningfully interact with your CD account just twice: once when you open it and another time when the CD matures and you withdraw your cash. While you will receive periodic interest credits and statements during the CD’s term, these do not require any action on your part, making it very easy to hold a CD somewhere different than your primary bank.
For anyone willing to venture to a smaller institution, these are the top-paying rates you can score today. And aside from the top return, our daily rankings of the best CD rates also include at least 15 nation-leading offers per term, giving you numerous options to find a CD that best meets your needs.
Rate Collection Methodology Disclosure
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.
Banks must be available in at least 40 states. 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.
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