CDs Offer Higher Yields Than Average as Fed Raises Rates

Investing in certificates of deposit (CDs) can be a reliable way to earn returns on your money, especially if you have cash set aside for a while. With the Federal Reserve now in a rate-raising cycle, yields from CDs could go even higher.

The highest CD rates available reach up to 5.00% Annual Percentage Yield (APY), although most top-tier options cluster around 4.35% to 4.50% APY. USAlliance Financial is currently advertising a 4.36% APY on a 12-month CD with only a $500 minimum.

EagleBank, on the other hand, offers a 4.45% APY on a one-year CD with a $1,000 minimum deposit. American Express has a slightly lower rate of 4.25% APY on a 10-month CD, but it requires no minimum balance.

For perspective, if you were to put $10,000 into a one-year CD with an average APY of 4%, you would earn $400 in interest over the year.