A certificate of deposit (CD) is a type of savings account that offers a fixed interest rate for a set period, allowing you to lock in competitive returns on your savings. While CD rates can differ significantly between financial institutions, understanding current market trends helps you make informed decisions about your investments.
Current CD Rate Snapshot
Traditionally, longer-term CDs have offered higher interest rates compared to short-term options. Banks typically provide better returns to encourage customers to keep their funds locked away for extended periods. However, today’s economic landscape has shifted this pattern, presenting unique opportunities for savers.
As of Sunday, September 6, 2026, the most competitive CD rate available is 4.35% APY, offered by Marcus by Goldman Sachs on its 18-month CD product.
Understanding CD Interest Earnings
Your potential earnings from a CD depend on the annual percentage yield (APY), which accounts for compounding interest. Most CDs compound interest daily or monthly, meaning your returns build upon previously earned interest throughout the term.
For example, investing $1,000 in a one-year CD with a 1.52% APY and monthly compounding would yield approximately $1,015.20 at maturity, representing $15.20 in interest earnings.
Conversely, selecting a one-year CD offering 4% APY with the same terms would grow your $1,000 investment to $1,040.74, generating $40.74 in interest.
With larger deposits, the benefits become more pronounced. Depositing $10,000 into a one-year CD at 4% APY would result in a final balance of $10,407.42, earning you $407.42 in interest over the year.
CD Options and Variations
While interest rates are crucial when selecting a CD, other features should also influence your decision. Various CD structures offer different advantages, sometimes trading slightly lower yields for increased flexibility or accessibility.
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Bump-up CD: Allows you to request a higher interest rate if market rates increase during your CD’s term, typically limited to one rate adjustment opportunity.
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No-Penalty CD (also called Liquid CD): Permits early withdrawal of funds before maturity without incurring penalties, providing greater liquidity.
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Jumbo CD: Requires substantial minimum deposits (often $100,000+) but may offer premium interest rates. Currently, traditional and jumbo CD rates show minimal differentiation in returns.
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Brokered CD: Purchased through brokerage firms rather than direct bank channels, potentially offering competitive rates or flexible terms while carrying elevated risks and possible lack of FDIC insurance.