CD Rates

CD Rates

The Fed Raises Interest Rates to Tackle Inflation

In an effort to combat high inflation, the Federal Reserve has been steadily increasing interest rates since last year. At their latest meeting, the Fed decided to raise rates by a quarter of a percentage point, marking the 11th interest rate hike since March 2022. This brings the federal funds rate, a crucial overnight bank lending rate, to a target range of 5.25% to 5.5%, the highest level since 2001.

The Federal Reserve officials anticipate at least one more rate hike before the end of the year as they believe that inflation continues to be a pressing concern. In their official statement, the Federal Reserve expressed a strong commitment to returning inflation to its 2 percent objective.

Implications for Savers

While the interest rate hikes may be seen as a measure to curb inflation, there is a positive side effect for savers. When the Federal Reserve raises interest rates, it often results in an increase in CD rates and rates on high-yield savings accounts. So, as the Fed continues to raise interest rates, it is likely that rates on savings accounts will follow suit and increase slightly.

Currently, many top-earning CD accounts offer Annual Percentage Yields (APYs) of over 4% and 5%. If you are looking to maximize your returns on savings, here are some of the best CD rates available, sorted by term length:

3-month CD rates

• America First Federal Credit Union
  • APY: 4.50%
  • Minimum deposit: $500
• Total Direct Bank
  • APY: 5.20%
  • Minimum deposit: $25,000
• Brilliant Bank
  • APY: 5.10%
  • Minimum deposit: $1,000
• Santa Clara County Federal Credit Union
  • APY: 5.09%
  • Minimum deposit: $500
• Popular Direct
  • APY: 4.75%
  • Minimum deposit: $10,000

6-month CD rates

• Total Direct Bank
  • APY: 5.40%
  • Minimum deposit: $25,000
• NASA Federal Credit Union
  • APY: 4.80%
  • Minimum deposit: $1,000
• Bellco Credit Union
  • APY: 5.50%
  • Minimum deposit: $500
• Popular Direct
  • APY: 5.35%
  • Minimum deposit: $10,000
• First Internet Bank
  • APY: 5.33%
  • Minimum deposit: $1,000

1-year CD rates

For the full list of top-earning 1-year CDs, check out Kiplinger’s.

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• BrioDirect
  • APY: 5.35%
  • Minimum deposit: $500
• USAlliance Financial
  • APY: 5.40%
  • Minimum deposit: $500
• CIBC Bank USA
  • APY: 5.36%
  • Minimum deposit: $1,000
• Popular Direct
  • APY: 5.38%
  • Minimum deposit: $10,000
• Bread Financial
  • APY: 5.35%
  • Minimum deposit: $1,500

2-year CD rates

• Bread Savings
  • APY: 5.00%
  • Minimum deposit: $1,500
• Delta Community Credit Union
  • APY: 5.00%
  • Minimum deposit: $1,000
• Crescent Bank
  • APY: 5.00%
  • Minimum deposit: $1,000
• First Internet Bank
  • APY: 4.85%
  • Minimum deposit: $1,000
• Popular Direct
  • APY: 4.80%
  • Minimum deposit: $10,000

3-year CD rates

For the full list of top-earning 3-year CDs, check out Kiplinger’s.

• U.S. Senate Federal Credit Union
  • APY: 5.13%
  • Minimum balance: $1,000
• Hughes Federal Credit Union
  • APY: 4.86%
  • Minimum balance: $1,000
• Quorum Federal Credit Union
  • APY: 4.85%
  • Minimum balance: $1,000
• Crescent Bank
  • APY: 4.75%
  • Minimum balance: $1,000
• Lafayette Federal Credit Union
  • APY: 4.84%
  • Minimum balance: $500

4-year CD rates

• GTE Financial
  • APY: 4.85%
  • Minimum balance: $500
• ECFU Financial
  • APY: 4.75%
  • Minimum balance: $500
• First Internet Bank
  • APY: 4.54%
  • Minimum balance: $1,000
• Bread Savings
  • APY: 4.50%
  • Minimum balance: $1,500
• Popular Direct
  • APY: 4.30%
  • Minimum balance: $10,000

5-year CD rates

For the full list of top-earning 5-year CDs, check out Kiplinger’s.

• Lafayette Federal Credit Union
  • APY: 4.68%
  • Minimum balance: $500
• ECFU Financial
  • APY: 4.75%
  • Minimum balance: $500
• Department of Commerce Federal Credit Union
  • APY: 4.67%
  • Minimum balance: $500
• MYSB Direct
  • APY: 4.66%
  • Minimum balance: $500
• First National Bank of America
  • APY: 4.65%
  • Minimum balance: $1,000

These rates are subject to change, so it is advised to check with the respective institutions for the most up-to-date information regarding their CD rates.

Conclusion

As the Federal Reserve continues to raise interest rates to combat inflation, it provides an opportunity for savers to earn more on their deposits. With attractive CD rates available for various term lengths, individuals can consider locking in their money to maximize their returns. However, it’s important to conduct thorough research and consider personal financial goals and circumstances before making any decisions. By staying informed and exploring the current offerings, savers have the potential to grow their savings and make the most of the prevailing interest rate environment.

Related Content

• 1-Year CD Rates
• Top Earning 3-Year CDs
• Best 5-Year CD Rates
• CD Rates Are High, Shop Around to Get the Best Returns

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