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Key Takeaways
- The Fed is likely to cut interest rates tomorrow, which would put downward pressure on the yields banks and credit unions pay on deposits.
- Savvy savers focused on maximizing returns often use top CDs to lock in today’s high rates for months or years, insulating their earnings from future Fed cuts.
- You can make that strategy even stronger by keeping a reserve in a top high-yield savings account, earning a solid return while keeping some cash easily accessible.
The full article continues below these offers from our partners.
A Fed Rate Cut Is Almost Certain This Week—Here’s What It Means for Your Savings
The Federal Reserve is currently meeting, and financial markets widely expect the central bankers to announce another quarter-point rate cut on Wednesday. That would follow a similar move in September—the first cut of 2025.
For savers, this matters—since banks’ savings yields generally move in step with the Fed’s benchmark rate. That rate is still relatively high, which is why today’s 4% to 5% savings returns remain strong. But with one or more Fed cuts ahead, those highs will start to slip—making now a smart time to lock in a top rate before it’s gone.
Why This Matters for You
With the Fed likely to make mutiple rate cuts, you can’t stop savings account rates from falling. But you can lock in one of today’s high yields for at least part of your cash by putting it in a CD that protects your return for months or even years.
The Smart Saver’s Trick: Use a CD To Lock In Today’s High Yields Before They Slip
With rates expected to fall, savvy savers know now’s a smart time to open a certificate of deposit (CD). 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, CDs let you secure today’s higher returns before the Fed’s next moves push them lower.
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. You can compare options in 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% in Flexible Savings—But That Window’s Likely Closing
A smart CD strategy depends on also keeping some cash accessible. That way, if you suddenly need funds, you can draw from savings first—without breaking your CD and incurring a penalty. Just as important, that cash cushion shouldn’t sit idle. To maximize your overall return, keep it in a high-yield savings account that earns as competitive a rate as possible.
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, today’s top high-yield options pay APYs roughly 10 to 13 times higher than average. The best offers currently pay up to 5.00% APY, and our daily ranking of the best high-yield savings accounts includes more than a dozen above 4.25%, 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.
