The Federal Reserve has cut rates, making now a good time to lock in a competitive CD rate before they fall further. Online banks and credit unions offer the best rates, with the highest rate currently at 4.1% APY on an 8-month CD from LendingClub.

CD rates depend on the APY, with higher rates leading to more interest. For example, a $1,000 investment in a 4% APY CD would yield $40.74 in interest after a year. The more you deposit, the more you stand to earn, so consider your options carefully.

When choosing a CD, consider factors beyond just the interest rate. Different types, like Bump-up, No-penalty, Jumbo, and Brokered CDs, offer unique benefits that could be more valuable than a higher rate. Make sure to weigh your options before making a decision.

Read more at Yahoo Finance: Best CD rates today, January 3, 2026 (best account provides 4.1% APY)