As spring is here, it’s a great time to enhance your financial savings with certificates of deposit offering high yields of up to 4.50% APY. These fixed-rate accounts provide a solid base for your savings during this season of rejuvenation, ensuring guaranteed returns even amidst potential rate cuts by the Federal Reserve. While traditional savings accounts typically earn an average of 0.41% APY, current CDs offer returns more than ten times higher, providing a safe and passive way to protect your savings without the risks associated with other investments or market fluctuations, especially for retirement planning. The best rates are currently available at online banks, where signing up for various terms is quick and easy, letting your deposit and interest grow steadily thanks to compound interest. For greater financial flexibility, consider creating a CD ladder to spread your funds across different maturity dates and interest rates, ensuring continuous returns through 2026 and aligning with long-term financial objectives. Check out the highest yields on FDIC-insured CD terms ranging from six months to a year or longer to strengthen your financial security.💰 Top savings rates today: Enjoy the highest APYs of up to 4.40% this spring.
Best CD rates for March 24, 2025
The most competitive rates are offered by FDIC-insured digital banks and online accounts, with returns of up to 4.50% APY available at Bread Financial, Alliant Credit Union, and other reputable providers as of March 24, 2025. Here are some of the top options:
– Bread Financial Savings CDs: 4.50% APY on a 6-month term with a $1,500 minimum deposit
– Valley Bank Online CDs: Up to 4.30% APY with a $25,000 minimum deposit
– Alliant Credit Union CDs: 4.25% APY on a 12-month term with a $1,000 minimum deposit
– Discover Bank CDs: 4.10% APY on 24-month terms and 4.00% APY for 12-month terms
– American First Credit Union CDs: 4.00% APY on a 12-month term with a $1 minimum deposit
– Barclays Bank Online CDs: 4.00% APY on 12-month terms with no minimum deposit
– CIT Bank CDs: 3.50% APY on an 11-month no-penalty CD
While online-only banks may not be as familiar as traditional institutions, each is FDIC-insured or partners with an FDIC-insured bank, ensuring protection for deposits up to $250,000 by the FDIC or the NCUA. Understand how CDs function and explore different types to maximize your savings potential.
The Federal Deposit Insurance Corporation (FDIC) is an independent government agency established by Congress to ensure stability and public trust in the U.S. financial system by providing insurance on consumer deposit accounts, including certificates of deposit and other savings accounts.
FDIC national deposit rates for a $10,000 minimum deposit in traditional low-interest deposit accounts were compared between March and February 2025. Here is a summary of the changes:
– Savings: 0.41% (no change)
– Interest checking: 0.07% (no change)
– Money market: 0.63% (down 1 basis point)
– 1-month CD: 0.25% (up 3 basis points)
– 3-month CD: 1.43% (down 2 basis points)
– 6-month CD: 1.61% (down 2 basis points)
– 12-month (1 year) CD: 1.78% (down 2 basis points)
– 24-month (2 year) CD: 1.49% (up 4 basis points)
– 36-month (3 year) CD: 1.35% (up 4 basis points)
– 48-month (4 year) CD: 1.27% (up 4 basis points)
– 60-month (5 year) CD: 1.34% (up 3 basis points)
The FDIC closely tracks with the key interest rate set by the Federal Reserve, affecting rates on deposit accounts, loans, mortgages, credit cards, and other financial products. The Fed’s rate changes impact rates on products like CDs, high-yield accounts, and money market accounts.
After multiple rate adjustments from March 2022 to July 2023 due to high inflation post-pandemic, the Federal Reserve announced rate cuts in September, November, and December 2025. In March 2025, the Fed paused rate cuts, maintaining the federal funds target interest rate at 4.25% to 4.50% to focus on achieving maximum employment and taming inflation.
The Fed will assess data and economic outlook to determine further adjustments. The next policy meeting is scheduled for May 6–7, 2025, with economists closely monitoring potential decisions by the Federal Reserve.
Recent economic reports have been dominated by discussions regarding inflation and labor statistics, with speculation about potential future cuts to the Federal Reserve rate. Inflation data has shown a decrease from a peak of 9.1% in June 2022 to a range between 2.5% and 4% since May 2023. A fresh labor report from the Bureau of Labor Services on March 7 revealed a rise in unemployment to 4.1% in February, along with employers adding 151,000 jobs to payrolls, slightly below expectations. The consumer price index released on March 12 displayed a decrease in the annual inflation rate to 2.8% in February, calming concerns about the economy. Federal Reserve Chair Jerome Powell mentioned at a press conference on March 19 that the Fed is anticipating slower growth and higher inflation due to tariffs, aiming to distinguish non-tariff from tariff inflation. The Fed’s rate-setting panel, led by Powell, is set to announce a rate decision on May 7, 2025.
For those interested in financial planning, comparing key factors when choosing a certificate of deposit (CD) is essential. Consider factors such as term length, rate of return, minimum deposit, and the type of bank or financial institution offering the CD. It is important to assess these factors against your specific savings goals or financial situation to make an informed decision.
Withdrawal penalties for breaking a CD before it matures are usually based on the amount of interest you would be giving up, such as 90 days of interest for CD terms up to 24 months. In general, the longer the term of the CD, the higher the penalty fee will be.
Considering when it may be beneficial to break a CD and an expert’s advice on early withdrawals and breaking even.
Advantages of a certificate of deposit include guaranteed returns, higher interest rates compared to traditional accounts, and a variety of term options to suit your financial objectives. However, drawbacks include penalties for early withdrawals, potentially lower investment returns compared to other investment options like stocks or bonds, and the inability to add more funds to the CD once it has been locked in.
In addition to CDs, there are alternative low-risk ways to earn interest on your savings, such as high-yield savings accounts, money market accounts, and higher-risk investments like stocks and mutual funds.
To learn more about CDs, safety, and growing your money, explore our personal finance guides and be informed about when your CD matures by keeping your contact information updated with your bank and setting a reminder for yourself. Banks make money with CDs by charging higher interest rates on loans than they pay out on customer deposits.
An account’s difference is called a spread, which banks rely on to generate profits. Unlike a standard savings account that allows for flexible movement of funds without penalty, a Certificate of Deposit (CD) requires locking in your deposit for a specific period. The principal along with interest is returned after the account matures. This lock-in period, along with penalties for early withdrawal, enables the bank to plan better for profit-making off your deposit. As a result, the bank is typically willing to pay slightly more for this reliability.
Is my money safe with online-only banks like Lending Club or SoFi? Yes. Online-only banks and digital accounts are as secure as traditional banks. They are either FDIC-insured chartered banks or partner with well-known banks to provide deposit accounts protected by the government for up to $250,000. Even if the fintech fails or goes out of business, the FDIC ensures the safety of your money. Look for terms like “member FDIC,” “FDIC insured,” or “NCUA insured” when comparing options.
Compound interest is the concept of earning interest on both your initial deposit and any interest accumulated over time, boosting your savings considerably. An account’s Annual Percentage Yield (APY) represents the total interest earned on your deposit over a year, including compound interest, expressed as a percentage.
A jumbo CD is a certificate of deposit that necessitates a minimum of $100,000 to open. Similar to regular CDs, jumbo CDs offer a fixed interest rate and term. While jumbo CDs traditionally offered higher rates than standard CDs, this may not always be the case with current high interest rates set by the Fed.
A no-penalty CD, also known as a liquid CD, allows for withdrawing money without penalty before maturity, offering greater flexibility compared to traditional CDs. However, it typically comes with lower rates of return. With interest rates at historic highs, a high-yield savings account might provide comparable or higher rates than a no-penalty CD.
A CD ladder is a savings strategy that involves spreading your funds across multiple CDs to capitalize on high rates without locking all your investment in one long-term CD. This approach allows access to a portion of your investment at regular intervals.
A brokered CD is a certificate of deposit purchased through a brokerage firm instead of directly from a bank.
Explore brokered CDs offered by your credit union. Similar to traditional CDs, you select a term length with a fixed interest rate. However, unlike regular CDs, these can be purchased through your investment account, either new or “used” from other investors. Discover more about brokered CDs and important factors to consider before making an investment decision.
Distinguish between saving and investing. Saving involves securely storing your money in accounts with minimal risk of losing your initial investment. Conversely, investing entails purchasing assets such as stocks, bonds, or mutual funds, which carry the potential for higher returns. Delve deeper into the concepts of saving and investing to determine the most suitable approach for growing your nest egg.
Please note: The annual percentage yields (APYs) displayed were accurate as of Monday, March 24, 2025, at 8:10 a.m. ET. APYs and promotional rates for certain products may vary by region and are subject to change.
