The Federal Reserve decided to pause interest rates for a second consecutive time on Nov. 1, allowing savers to continue reaping the benefits of elevated rates. Many banks are pushing rates past a 5% annual percentage yield, or APY, on certificates of deposits (CDs) and savings accounts. That means you have plenty of options to earn a bigger return on your hard-earned cash.
But if you’re like 66% of Americans, you have yet to move your savings to a high-yield savings account, according to a survey by Santander. The good news is there’s still time to boost your interest earnings with competitive rates, whether you want to set aside money for emergency savings or build a sinking fund for holiday expenses. And with experts predicting the Fed is unlikely to raise rates further, this may be as good as savings and CD rates get.
Banks offering more than 5% APY on high-yield savings accounts and CDs
Whether you’re looking for a new savings account or CD to park your money for a savings goal, here are some of the banks offering the best return on your savings right now.
Savings account rates remain the same this week, with several north of 5% APY
Most banks we track kept high-yield savings rates the same this week. The average savings rate for banks we track at CNET to 4.85% APY.
Here are more high-yield savings accounts offering APYs beyond 5%:
- Digital Federal Credit Union: 6.17% (On balances up to $1,000)
- My Banking Direct: 5.35%
- TAB Bank: 5.27%
- Newtek Bank: 5.25%
- UFB Direct: 5.25%
- Bread Savings: 5.15%
- EverBank: 5.15%
- Bask Bank: 5.10%
- BMO Alto: 5.10%
- CIT Bank: 5.05%
Note: To earn these high APYs, you may have to meet certain deposit requirements or may earn only the highest APY on a portion of your balance. Additionally, the highest APYs are usually offered at online-only banks, which means you should be comfortable managing your account and other banking services online.
Read more: High-Yield Savings Accounts That Earn a 5% APY or More
Many short-term CDs offer 5% APY or more
CD rates remained largely the same this week across banks we track at CNET -- with the average APY for one-year CDs resting at 5.28%. Right now, long-term CD rates aren’t nearly as high as short-term CD rates. Most banks reserve their highest rates for CD terms of two years or less. Here’s a rundown:
| Bank | Term and APY |
| Alliant | 1 year (5.25%), 18 months (5.30%) |
| Barclays | 1 year (5.40%), 18 months (5.25%) |
| Bask Bank | 6 months (5.55%), 1 year (5.40%) |
| BMO Alto | 6 months (5.50%), 1 year (5.65%) |
| Bread Savings | 1 year (5.50%) |
| CFG Bank | 1 year (5.35%), 18 months (5.05%) |
| Forbright | 9 months (5.75%), 1 year (5.65%) |
| MYSB Direct | 6 months (5.26%), 1 year (5.30%) |
| Rising Bank | 6 months (5.15%), 1 year (5.60%) |
| Quontic | 6 months (5.05%), 1 year (5.30%) |
| Synchrony | 9 months (5.50%), 1 year (5.30%) |
| EverBank | 9 months (5.50%) |
How to decide whether CDs or high-yield savings are best for you
With short-term CDs over 5% and some high-yield savings accounts hovering at similar rates, choosing between the two savings vehicles may not be easy. It all boils down to when you’ll need the money and your goal for the funds.
“What are you trying to accomplish with the money that is in question?” said Ravin Walters, a certified financial planner at Transverse Wealth Solutions. “If the answer is for emergencies, a fully liquid and accessible high-yield savings account would be the most suitable option.” Aside from your emergency fund, any excess cash you plan to use in a few years can go into a CD that matures right before the expected date you’ll need the money.
When it comes to shorter-term CDs, you’ll need to do some math to determine whether a high-yield savings account is better. However, since high-yield savings accounts have a variable APY, you may prefer to lock in a short-term CD to ensure a guaranteed rate if rates drop over the next few months.
But remember, if you need to withdraw the funds before the CD matures, you’ll pay an early withdrawal penalty -- which can eat away at your interest earnings.
The bottom line
Today’s high interest rates are a win-win for savers. CDs and high-yield savings accounts are good low-risk places to park your money. If the account is provided by an FDIC- or NCUA-insured bank, your funds are protected up to $250,000 per person, per bank if the bank fails. But with short-term CD rates rising and savings account rates beyond 5% APY, the best place for your savings depends on your goals.
When choosing between a short-term CD and a high-yield savings account, consider the pros and cons of each account type. While CDs can offer a guaranteed return on your money, high-yield savings accounts give you flexibility to access your money without penalty if you need it on short notice. However, if you’re considering putting money in a long-term CD, such as a three- or five-year term, now’s the time to start comparing rates since experts say they won’t get much better in the coming months.
