Introduction: When it comes to saving money, certificates of deposit (CDs) are a tried-and-true option that combines safety and predictable returns. However, the best CD rates can vary widely, depending on where you look and what terms you choose. Whether you’re looking for a short-term CD to park some cash or a long-term CD for more substantial returns, knowing where to find the best CD rates can help you maximize your savings.
In this article, we will explore the best CD rates available in the market for 2025, with a focus on high-yield, low-risk options from top banks and credit unions. By the end, you’ll know exactly where to find the best CD rates, how to choose the right CD for your needs, and how to ensure you get the most out of your savings.
What Are Certificates of Deposit (CDs)?
Before diving into the best CD rates, let’s first explain what CDs are and why they are an attractive savings tool.
A certificate of deposit (CD) is a fixed-term deposit offered by banks and credit unions. It allows you to lock in your money for a set period, ranging from a few months to several years, at an agreed-upon interest rate. In exchange for keeping your money in the CD for the specified term, the bank or credit union rewards you with a higher interest rate than a typical savings account.
CDs are ideal for conservative savers who want a guaranteed return on their investment and are not in need of immediate access to their funds. The longer the term, the higher the interest rate tends to be, but early withdrawals typically incur penalties.
How Do CD Rates Work?
The interest rate on a CD is determined by several factors, including:
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Term Length: Longer-term CDs generally offer higher interest rates than short-term ones.
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Economic Environment: Interest rates are influenced by the Federal Reserve’s monetary policy and broader economic trends.
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Bank or Credit Union: Different financial institutions offer varying CD rates based on their own strategies and customer base.
In general, a higher interest rate means you’ll earn more money on your investment, but you also need to keep your money locked up for the term of the CD.
Top Factors to Consider When Choosing a CD
When searching for the best CD rates, there are several important factors to consider to ensure that you get the highest possible return on your savings:
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Interest Rate: This is the primary factor in determining how much you’ll earn. Compare CD rates from different banks and credit unions to find the best deals.
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Term Length: Consider how long you’re willing to lock up your money. While longer-term CDs often offer higher rates, you need to be prepared not to access your funds until the term ends.
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Early Withdrawal Penalties: Most banks impose penalties if you withdraw your funds before the CD term is up. These penalties can vary, so make sure you understand the rules before opening an account.
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Compounding Frequency: The more frequently the interest compounds, the more you will earn. Some banks compound interest daily, while others do so monthly or quarterly.
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Minimum Deposit Requirements: Many banks require a minimum deposit to open a CD. Ensure the minimum fits within your budget.
Best CD Rates on the Market in 2025
Below, we highlight some of the best CD rates available in the market in 2025. We’ve included a mix of short-term and long-term options, as well as accounts with competitive yields.
1. Ally Bank – 12-Month CD
APY: 5.00%
Minimum Deposit: $0
Ally Bank is a well-known online bank offering some of the best CD rates in 2025. Their 12-month CD provides an attractive annual percentage yield (APY) with no minimum deposit requirement, making it an excellent choice for both new and experienced savers. Ally also allows you to manage your account online, which is a convenient feature for customers who prefer digital banking.
Why Choose Ally Bank?
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Competitive APY with no minimum deposit.
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Flexible online management tools.
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FDIC-insured for safety.
2. Marcus by Goldman Sachs – 24-Month CD
APY: 5.10%
Minimum Deposit: $500
Marcus by Goldman Sachs is another top contender, offering a 5.10% APY on their 24-month CD. With a relatively low minimum deposit requirement of $500, this CD is accessible for most savers. Marcus is known for its customer-friendly policies, such as no fees for maintaining the account and no penalty for withdrawing from certain CDs after the term has passed.
Why Choose Marcus by Goldman Sachs?
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High APY with a low minimum deposit.
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No fees or penalties for account maintenance.
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FDIC-insured and backed by a reputable financial institution.
3. Synchrony Bank – 18-Month CD
APY: 5.05%
Minimum Deposit: $2,000
Synchrony Bank offers a competitive 5.05% APY on their 18-month CD. Though it has a higher minimum deposit than some other options, this CD is an excellent choice for savers who have more to invest and want to lock in a good rate for a relatively short period.
Why Choose Synchrony Bank?
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Competitive interest rates with a slightly higher deposit requirement.
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Known for excellent customer service.
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FDIC-insured.
4. Capital One – 6-Month CD
APY: 4.85%
Minimum Deposit: $0
For those looking for a shorter-term option, Capital One offers a 6-month CD with an attractive APY of 4.85%. There’s no minimum deposit required, which makes this CD highly accessible for new savers or those looking to park their cash for a short time.
Why Choose Capital One?
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No minimum deposit requirement.
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Flexible terms for savers who want quicker access to funds.
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FDIC-insured with a trusted banking brand.
5. PenFed Credit Union – 12-Month CD
APY: 5.25%
Minimum Deposit: $1,000
PenFed Credit Union offers one of the highest CD rates available in 2025, with a 5.25% APY on their 12-month CD. Although it requires a $1,000 minimum deposit, PenFed’s attractive rates and customer satisfaction ratings make it a top choice for savers who want to maximize their returns.
Why Choose PenFed Credit Union?
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High APY with a low minimum deposit.
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Excellent customer service and reputation.
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Accessible to both current and potential members.
How to Maximize Your Earnings With CDs
To get the most out of your CD investments, consider these tips:
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Laddering Strategy: One of the best ways to optimize your returns is through a strategy called “CD laddering.” This involves opening multiple CDs with different terms (e.g., 6-month, 1-year, 2-year), so you have a steady stream of maturing CDs that you can reinvest at higher rates.
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Avoid Early Withdrawals: Withdrawing funds early can result in penalties that eat into your earnings. To avoid this, choose a CD term that aligns with your financial goals.
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Compare Rates Regularly: Rates on CDs can fluctuate, so it’s essential to shop around and compare options regularly to ensure you are getting the best return on your investment.
Conclusion: Finding the Best CD Rates
In 2025, there are numerous financial institutions offering competitive CD rates that allow you to maximize your savings safely. The best CD rates depend on your goals, investment horizon, and how much you can afford to lock away. Whether you’re looking for a short-term option or a long-term strategy, there are CDs with excellent yields that can help you grow your money.
To make the most of your savings, compare rates from various banks and credit unions, choose the term that best fits your financial situation, and consider the importance of laddering or avoiding early withdrawals.