:max_bytes(150000):strip_icc()/late-damircudic-dc9e3410b7ac4b7fb041ac1859807019.jpg "Is It Too Late To Lock In a CD Before the Fed Cuts Rates?")
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Key Takeaways
- The Fed will likely cut rates this week, which will push savings and CD yields gradually lower—but it’s not too late to lock in a strong APY.
- Opening a top nationwide CD can secure one of today’s 4%-plus rates, guaranteeing your return for months or years despite Fed cuts.
- For cash you want to keep flexible, top high-yield savings accounts still pay in the 4% to 5% range, but those rates are expected to slip.
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A Fed Rate Cut Is Likely This Week—What It Means for CD and Savings Rates
The Federal Reserve meets Wednesday, and financial markets widely expect the central bankers to announce another quarter-point rate cut—likely followed by an additional reduction in December. This comes after September’s quarter-point cut, the first of 2025.
For savers, this matters. Bank and credit union deposit rates generally move in step with the Fed’s benchmark rate, so each cut will push saving and CD yields gradually lower. You can’t stop rates from falling, but you can make smart moves now to maximize what your money earns in the months ahead.
If you’ve been thinking about opening a CD, now’s the time to move. Acting quickly can help you lock in a higher guaranteed return for months—or even years—before top CD offers start disappearing.
Why This Matters for You
Rate cuts are around the corner, and CD and savings yields won’t stay this high for long. Acting now can help you keep earning top returns as rates begin to drift lower.
CDs Let You Lock In Today’s High Yields Before They Drift Lower
As rates begin to edge lower, certificates of deposit (CDs) offer a smart way to preserve one of today’s higher returns. Unlike savings or checking accounts, where yields can drop at any time, a CD locks in your rate until maturity. If you can set aside money for a few months, a year, or more, a CD lets you capture today’s top yields before the Fed’s next moves push them down.
Right now, the best CD rates range from about 4.30% to 4.40% on shorter terms of 3 to 13 months. The top mid-range CDs—those lasting 18 months to 3 years—let you lock in 4.20% to 4.25%, while longer-term CDs offer a 4- to 5-year rate lock in the low 4% range. Check out our daily rankings of the best CDs to see where yields stand today.
Just be sure to match your CD to your timeline. Withdraw before maturity and you’ll face an early withdrawal penalty. And always keep some cash accessible for emergencies so you’re not forced to tap your CD early.
Your Cash Can Still Earn up to 5%—But Rates Won’t Stay This High Forever
For cash you want to keep accessible—whether alongside or instead of a CD—it still pays to earn a strong return. The FDIC’s national average savings rate is just 0.40%, and some of the biggest banks—like Chase, Bank of America, and Wells Fargo—pay close to zero. In contrast, top high-yield options offer APYs that are 10 to 13 times higher.
With the latest inflation rate climbing to 3%, earning less than that means your savings are effectively losing value over time. That’s why it’s important to keep your money in an account that keeps pace.
Fortunately, there are dozens of options to do that—including top high-yield savings accounts that pay as much as 5.00% APY. While that top yield requires meeting some conditions, our daily ranking of the best accounts includes 15 accounts offering 4.25% or better, many with no strings attached.
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.
