CD rates vary by bank, account type, and term length — there is no single "best" rate
The highest CD rate available to you depends on where you look, how long you lock your money away, and what type of account you open. Online banks typically offer higher rates than brick-and-mortar banks because they have lower overhead costs. Credit unions sometimes offer competitive rates to their members. The same bank may pay different rates on a 3-month CD than on a 5-year CD, and rates change daily based on what the Federal Reserve does with interest rates.
You cannot compare rates by walking into one bank and calling another. You need to check multiple sources on the same day, note the term length and account type for each quote, and understand that the rate you see today may be different tomorrow. Some banks advertise a promotional rate for new customers only, while others pay the same rate to everyone.
Key Takeaways
- Online banks and credit unions often post higher CD rates than traditional banks, but you cannot deposit or withdraw cash in person.
- The rate you receive depends on the CD term (3 months, 1 year, 5 years, etc.), so comparing a 1-year rate at one bank to a 5-year rate at another will give you a false picture.
- CD rates change daily, so a rate you see on Monday may be lower or higher by Friday.
- Some banks offer promotional rates only to new customers or only on certain term lengths, so read the fine print before opening an account.
Where to find current CD rates
The fastest way to compare rates is to visit bank websites directly and note the rate for the same term length across multiple institutions. Most banks display their current CD rates on their homepage or in a rates section. You can check rates at online banks (Ally, Marcus, American Express Personal Savings), traditional banks (Chase, Bank of America, Wells Fargo), and credit unions (check your own credit union's website first if you are a member).
Financial websites like Bankrate, DepositAccounts, and CDs.com aggregate CD rates from hundreds of banks and let you filter by term length and sort by rate. These sites update rates multiple times per day. The rates shown are current as of the time you view them, but they may change within hours. When you find a rate you want, you will still need to go to that bank's website to open the account — the aggregator sites do not process applications.
Your own bank may not have the highest rate, but it may offer convenience (you already have an account there) or perks (you can manage the CD alongside your checking account). Weigh the rate difference against what matters to you. A 0.5% difference on a $10,000 CD for one year is $50 — decide if that is worth switching banks.
How term length affects the rate you see
Banks pay different rates for different CD terms. A 3-month CD might pay 4.50%, while the same bank's 5-year CD pays 4.75%. This happens because banks use longer-term CDs to lock in customer deposits for longer periods, and they price that stability into the rate. When you compare rates, always note the term length — comparing a 1-year rate at Bank A to a 3-year rate at Bank B tells you nothing useful.
The relationship between term length and rate is not always the same. Sometimes longer terms pay more (a "normal" yield curve). Sometimes shorter terms pay more (an "inverted" curve). Sometimes the difference is tiny. Check what each bank offers across multiple term lengths to see the full picture. A bank with the highest 1-year rate might not have the highest 3-year rate.
Promotional rates and new-customer offers
Many banks advertise a higher rate for new customers only or for a limited time. The promotion might explore to all term lengths or only to specific ones (for example, new customers get 5.00% on a 1-year CD, but existing customers get 4.75%). Some promotions require you to deposit a minimum amount or to have a linked checking account. Read the terms carefully — the advertised rate may not be the rate you actually receive.
Promotional rates are real rates, not tricks. If you meet the requirements, you will earn that rate. But once the promotion ends or you close the CD, you may not get that rate again if you open another CD at the same bank. Some people move their CDs between banks every time a promotion ends to chase higher rates — this is legal and common, though it requires more work than leaving money in one place.
Online banks versus traditional banks
Online banks (banks with no physical branches) typically pay higher CD rates than traditional banks. They have lower costs because they do not maintain branch buildings, pay tellers, or run call centers. They pass some of those savings to customers in the form of higher rates. The trade-off is that you cannot walk into a branch to deposit cash or speak to someone in person. You deposit money by electronic transfer from another bank account, and you manage the CD through a website or mobile app.
Traditional banks (Chase, Bank of America, Wells Fargo, and regional banks) often pay lower CD rates than online banks. You can deposit cash in person and speak to a banker face-to-face. If you value convenience and already bank there, the lower rate might be worth it. If you want the highest rate and do not mind managing money online, an online bank is usually the better choice.
Credit union CD rates
Credit unions are member-owned financial institutions that sometimes offer competitive CD rates. You must be a member to open a CD at a credit union, which usually means you live or work in a certain area, belong to a certain employer, or meet another membership requirement. Some credit unions offer rates that beat online banks; others offer rates lower than traditional banks. There is no pattern — you have to check your own credit union's rates.
If you are already a credit union member, compare your credit union's CD rates to online banks and traditional banks before deciding. Credit unions also offer the advantage of in-person service and, in most cases, NCUA insurance (similar to FDIC insurance at banks) that protects your deposits up to $250,000. If your credit union offers a competitive rate and you value the service, it may be the right choice even if it is not the absolute highest rate available.
What happens to your rate if interest rates change
Once you open a CD, your rate is locked in for the entire term. If you open a 2-year CD at 4.50%, you will earn 4.50% for the full 2 years, even if the Federal Reserve raises rates and new CDs start paying 5.50%. This is the trade-off of a CD: you get a may provide rate, but you cannot benefit if rates go up. You also cannot lose if rates go down — your rate stays the same.
Banks change the rates they offer on new CDs every day based on what they expect interest rates to do. If you see a rate you like, you can open the CD that day. If you wait, the rate might be higher or lower tomorrow. There is no way to know which direction rates will move, so do not try to time the market. Open a CD when the rate meets your needs and you are ready to lock the money away for that term.
Frequently Asked Questions
Do I need to have an existing account at a bank to open a CD there?
No. Most banks let you open a CD without having a checking or savings account with them. You will need to provide your Social Security number, address, and other identifying information, and you will fund the CD by electronic transfer from another bank account. Some banks offer a small discount or bonus if you also open a checking account, but it is not required.
Can I move my CD to a different bank if I find a better rate?
Yes, but only after your current CD matures (reaches the end of its term). If you withdraw the money before maturity, you will pay an early withdrawal penalty, which usually costs several months of interest. Once the CD matures, you can withdraw the money and deposit it into a CD at another bank. Some people do this repeatedly to chase higher rates, though it requires tracking multiple maturity dates.
What is the difference between a CD rate and an APY?
APY (annual percentage yield) is the rate banks must show you by law. It includes the effect of compounding — how often the bank adds interest to your account. A CD with a 4.50% rate and daily compounding will earn slightly more than a CD with a 4.50% rate and monthly compounding. Always compare APYs, not just the stated rate, to see which CD will actually earn you more money.
Are CD rates the same at all branches of the same bank?
Yes. Large banks set one rate for all their branches nationwide. A Chase CD opened in New York will pay the same rate as a Chase CD opened in California. Credit unions may have different rates at different branches or credit unions, even if they are part of the same network, so check your specific credit union's rates.
What if the bank lowers its CD rates after I open my account?
Your rate does not change. The bank can only lower rates on new CDs it sells going forward. Your existing CD will pay the rate you locked in when you opened it, for the full term. This is one of the main benefits of a CD — your rate is may provide and cannot be reduced.