5% CD Rates: Where To Find Them

Q: Can you get 6% on a CD?

In some cases, you can find 6% CDs . Often, these somewhat elusive savings opportunities require hefty initial deposits, though, and may come with fees or other costs that make them less accessible than other options. Credit unions may also offer 6% APY as an introductory offer for CDs to entice consumers to become members or open new accounts.

Q: Are there any 7% CDs?

There are currently no banks offering 7% CDs . Instead, you will need to look at credit unions to find these rare interest rates.

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Key Takeaways

Can you get 5% on a CD?
Pros and cons of 5% CDs
Our top picks for the best CD rates
How much can I make on a 5% CD?
Should I get a 5% CD?
Alternatives to a 5% CD
FAQ: 5% CD rates
Related topics

On This Page

Key Takeaways
Can you get 5% on a CD?
Pros and cons of 5% CDs
Our top picks for the best CD rates
How much can I make on a 5% CD?
Should I get a 5% CD?
Alternatives to a 5% CD
FAQ: 5% CD rates
Related topics

By Sarah Stasik - Personal Finance + 1 other

Reviewed By Blake Esken - Los Angeles Times

A 5% CD rate stands well above the national average, which is currently 1.88% APY for a one-year CD.
Many banks offer certificates of deposit that pay 5% APY or more. These high-yield CDs are usually available through online banks.
The best CD rates currently tend to be for short-term CDs, which have terms of 12 months or less.
While many CDs require a minimum deposit of $500 or more, there are some options available with opening deposits as low as $1.

Featured Offer

LEARN MORE FDIC insured
Rates updated as of 10/15/2024

4.65%

6 months

min_deposit

Why We Like It

The Barclays six-month CD is a good choice for short-term savers who want flexibility and growth. It offers a competitive interest rate without locking up your funds for long, and daily compounding interest helps your balance grow faster than with monthly or annual compounding. Plus, there are no maintenance fees or minimum balance requirements, making it accessible to many savers.

As an online-only bank, Barclays has no physical branches. However, if you’re comfortable managing your accounts online, this CD provides a convenient way to grow your savings while keeping easy access to your money.

Competitive APY
No minimum deposit required
Initial deposit isn’t due until 14 days after account opening
Insured by the FDIC

Must maintain a balance that would earn at least 1 cent if you want the interest to post to your account
Early-withdrawal penalty
No physical branch locations

Can you get 5% on a CD?

Yes, you can get 5% CD rates and many financial institutions offer them. However, they may require deposit and account balance minimums, and if you can’t deposit enough, you may not be able to access the advertised high APY earnings.

Currently, the best CD rates tend to be on shorter-term CDs — you’re more likely to find 5% CD rates with certificates of deposit of 12 months or less.

If you are looking at CDs with a credit union, you may need to meet other eligibility requirements, such as being a member of the credit union.

Pros and cons of 5% CDs

5% or more is much higher than the average CD or savings interest rate
Certificates of deposit are generally FDIC-insured and are considered low-risk investments
You are guaranteed to earn the advertised rate if you meet the minimum balance and term requirements
You can usually choose from a variety of terms to meet your savings needs

You typically can’t access the money in your CD during the term without paying penalties or losing your high APY
Interest earnings on higher-risk investment options can be much more lucrative
If inflation rates are higher than your APY, your real return isn’t as high as it might seem

Our top picks for the best CD rates

How much can I make on a 5% CD?

If you invest $1,000 in a CD with a 5% APY, you’ll earn $50 in interest after one year. If you invest $5,000 in the same CD, you’ll earn $250.

We used a CD calculator to compare the earnings on a 5% CD with a one-year term in the table below.

Earnings on a 5% CD after one year

Initial deposit	Interest earned	Total balance after 1 year
$500	$25	$525
$1,000	$50	$1,050
$2,500	$125	$2,625
$5,000	$250	$5,250
$10,000	$500	$10,500
$15,000	$750	$15750
$20,000	$1,000	$21,000

*The calculations provided are just a simple representation and may differ depending on the calculator used. Always seek advice from a qualified professional before making important financial decisions or long-term agreements.

Remember that the amount you earn with any certificate of deposit depends on several factors.

These factors include:

How much you deposit. The more money you start with, the more money earns interest over the term of the CD.
The CD term. Leaving money in a CD for longer allows interest to keep building, which can result in more savings.
Fees. If you’re paying monthly maintenance fees or other costs, that reduces how much you save.

Should I get a 5% CD?

A CD with a 5% APY might be a good choice for you if:

You want a stable, safe savings option.

CDs offer a safe investment and a guaranteed return if you abide by the terms of your account. Furthermore, 5% CD rates are well above average for national CD and savings deposit interest rates, allowing you to earn more on your money than you might with other types of accounts.

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You have short or mid-length savings goals.

CDs are commonly for terms of three months to five years, and currently, the best rates tend to be on terms of 12 months or less. If you have savings goals within those time periods, CDs can be a good tool.

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You don’t need the funds right away.

CDs require you to keep the funds in your account for a specified period of time. If you withdraw funds early, you may pay a hefty penalty and lose any or all interest you might otherwise have earned. For instance, if you select a CD with a six-month term, those funds are committed for six months.

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You don’t think the interest rates will rise significantly during the term.

If investment advice seems to be that interest rates on CDs will rise significantly in the short term, you may want to hold off on investing a lot of your funds with a longer-term CD.

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CD ladders

If you do decide that CDs are a good choice for you, consider whether a CD laddering strategy might be helpful. Laddering occurs when you break your funds into numerous CD investments, spreading them out over time so that funds become available at different times.

For example, if you have $10,000 to invest, you may not want to put it all in a single one-year CD. Instead, you could:

Invest $2,500 in a three-month CD
Invest $5,000 in a six-month CD
Invest $2,500 in a 12-month CD

Your entire $10,000 won’t be tied up for the whole year, but you can roll each smaller amount into new CDs if you still don’t need the cash when the maturity dates hit.

Alternatives to a 5% CD

CDs that pay 5% or more are only one of the ways to make your money work for you. Most banks offer some other savings options.

High-yield savings accounts

High-yield savings accounts can offer rates of 4% or 5%, especially if you choose an online bank. You can also find accounts that don’t require minimum balance or deposit amounts and don’t charge monthly maintenance fees, making it easier to access this savings option.

The main difference between a savings account and a CD is that your funds aren’t held up for a certain period of time. You can move money in and out of your savings account more freely as it is only limited by whatever withdrawal limitations your bank might have.

Money market accounts

A money market account is a type of savings account that usually offers higher interest rates than regular savings accounts and provides limited check-writing and debit card privileges. It can be considered as a hybrid between a checking and savings account, but the features of money market accounts vary at each bank.

One reason for choosing a money market account is that they typically offer a higher APY than traditional checking accounts while providing access to funds that are more flexible than what you get with a savings account or CD.

FAQ: 5% CD rates

What bank is paying 5% on CDs?

Numerous banks offer CDs with 5% or higher APY. Quontic Bank, Bask Bank and Synchrony are a few that offer such rates currently.

However, rates do change frequently so it’s important for you to do your research when shopping for certificate of deposit options.

Is 5% for a CD good?

Yes, 5% APY is a good return on a CD. It is much higher than the national savings average for deposit accounts — between five to 10 times higher, depending on the type of account you’re considering.

Is a 5% CD worth it?

A 5% CD can be worth it if you don’t need your funds immediately and you want to keep your money in a safe, secure account while also earning a little interest on it.

How much can I make on a 5% CD?

How much you make on a 5% CD depends on how much you deposit and how long the term is. The larger your deposit and the longer the term, the more interest your funds will earn.

A $10,000 CD with a 5% APY and a one-year term will earn around $500 at maturity. A much larger $50,000 CD will earn approximately $2,500 at maturity.

Who is paying the highest CD rates right now?

Generally, online banks pay the highest savings and CD rates. This is because they don’t have the same expenses traditional branch-based financial institutions do.

Online banks can often pass those savings on to account holders by paying higher interest rates and not charging monthly maintenance or other fees.

Can you get 6% on a CD?

In some cases, you can find 6% CDs. Often, these somewhat elusive savings opportunities require hefty initial deposits, though, and may come with fees or other costs that make them less accessible than other options.

Credit unions may also offer 6% APY as an introductory offer for CDs to entice consumers to become members or open new accounts.

Are there any 7% CDs?

There are currently no banks offering 7% CDs. Instead, you will need to look at credit unions to find these rare interest rates.

About the Author

Sarah Stasik Personal Finance

Sarah Stasik is well versed in personal finance thanks to her previous role as a Revenue Cycle Manager for a Fortune 500 healthcare company. Using her inside knowledge and expertise, Sarah often covers topics ranging from insurance and the economics of private healthcare to personal finance and small business management.

With more than a dozen years of writing experience, Sarah has tackled niches that range from technical advances in fintech to personal budgeting challenges. She has covered topics such as insurance and the economics of private healthcare, small business management and accounting, and credit and savings. Her writing focuses on making complex or seemingly daunting financial topics more accessible and providing helpful and relevant resources for readers.

About the Reviewer

Blake Esken Los Angeles Times

Blake Esken has over 15 years of experience in product management and has been a member of the Los Angeles Times staff for over five years.

As part of his role at the Los Angeles Times Commerce Team, Blake acts as the in-house reviewer and fact checker for LA Times Compare. He supervises all content for compliance and accuracy and puts to use skills he has honed through years of experience managing high-stakes projects for a range of industry-leading companies.

He has a strong background in data analysis, compliance, and communication, which allows him to support LA Times Compare through fact-checking in an effort to provide up-to-date and factual information across our content.