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5 CD types to consider right now

Short-term, high-yield CDs today can earn upwards of 5% APY. Nicolas Hansen/ Getty Images

As interest rates rise throughout the economy, certificates of deposit (CDs), in particular, are having a moment.

High interest rates have translated to great savings rates on a number of account types — including high-yield savings accounts — but CDs now offer savers some of the highest rates available. In fact, some CDs can help you earn more than 5% APY on your savings balance.

In general, CD interest comes at the cost of locking your money in the account for the agreed-upon term length — or risk losing your interest earnings. But not every CD account is the same. They can vary significantly in terms of rate, fees, minimums and time commitment.

Whether your priority is scoring the highest savings rate possible, or you're looking to get a great APY while still maintaining some flexibility, there are multiple CD types worth considering right now.

Learn how much you could boost your savings with a top CD here now.

5 CD types to consider right now

These are five CD types that should be on every saver's radar today.

Short-term high-yield CDs

If you're looking for the best savings rates right now, high-yield CDs with short term lengths are the best option. Plus, shorter terms leave some flexibility to take advantage of higher rates in the future. 

These generally work the same as traditional CDs, in which you lock your deposit with the bank and face a penalty fee for early withdrawal. At the end of the CD term, you'll receive your full deposit and the interest you've earned in full. High-yield CDs, unlike traditional CDs, are typically offered by online banks (like high-yield savings accounts). And for the best rates today, look for terms of one year or less. 

Here are a few of the best short-term CDs with high yields today:

  • Bread Savings 1-year CD: 5.20% APY
  • Synchony Bank 6-month CD: 5.00% APY
  • CIT Bank 6-month CD: 5.00% APY

Compare even more of the best CD rates right now to get the most from your savings.

Long-term high-yield CDs

While you'll find the best CD rates right now from short-term CDs, there are still benefits to long-term CDs today, too. Historically, long-term CDs offered savers the best APYs; you're locking your money up with the bank for a longer period of time, after all. But today, the rates on these accounts are more akin to high-yield savings.

The benefits of long-term CDs right now are that they can help you preserve today's high rates over five years or even more. You can lock in a rate over 4% with a long-term CD now, and earn that amount for years to come — instead of worrying about variable interest if rates go down.

These are some of the highest rates on long-term CDs right now:

  • Popular Direct 5-year CD: 4.50% APY
  • Bread Savings 5-year CD: 4.25% APY
  • Ally Bank 5-year CD: 4.10% APY

No-penalty CDs

No-penalty CDs are among the most flexible CD types. While you'll still lock in a fixed interest rate and agree to a term length when you make your deposit, you won't pay a penalty for withdrawing your money early. After the initial waiting period (about one week), you can withdraw your total balance, including any interest earned so far, with no penalty.

This type of CD may not be the highest-earning option right now, though they do still have competitive rates, and term lengths are typically around one year. But the real benefit is the option to withdraw your money in favor of a higher-earning account if rates go up before the end of your term.

Here are some top no-penalty CD rates today:

  • CIT Bank 11-month no-penalty CD: 4.90% APY
  • Ally Bank 11-month no-penalty CD: 4.25% APY
  • Marcus 13-month no-penalty CD: 4.25% APY

Bump-up or step-up CDs

Bump-up and step-up CDs are good options in a rising rate environment because they allow you a bit of wiggle room in the rate you earn over the lifetime of your account. 

With bump-up CDs, you can request a higher rate if your bank raises the APY it offers over the lifetime of your account. You may be limited to one request, or get multiple throughout your CD term. Step-up CDs are similar, but you don't need to request the increase. Typically, your bank automatically increases your rate at different intervals throughout your CD term. Beyond the rate changes, these CD types generally have the same restrictions as other CDs. 

These are a few competitive bump-up or step-up CDs:

  • TIAA Bank 3.5-year bump rate CD: 4.10% APY
  • Synchrony Bank 24-month bump-up CD: 3.70% APY

Brokered CDs

Brokered CDs work a lot like high-yield CDs, but they're offered through a brokerage firm instead of a bank. Often, these CDs are issued by banks for brokerage customers — so they may still be insured up to limits by the FDIC. Your brokerage should clearly state whether CDs are FDIC-insured online or in your account terms.

One big difference with brokered CDs compared to bank CDs is that you can trade them on secondary markets, like you would other investments. However, your interest rate is only guaranteed if you hold your CD until maturity. If you decide to sell, you could potentially take a loss.

Here are a few examples of brokered CDs:

  • Vanguard 4-6 month CD: 5.30% APY
  • Vanguard 13-18 month CD: 5.50% APY
  • Fidelity 13 month CD: 5.35% APY

Maximize your savings balance by comparing more top CD rates available now.

The bottom line

Certificates of deposit are one of the best ways you can start earning more on your savings balance today. While CDs are generally a bit more rigid than savings accounts — thanks to required minimum deposits, penalties for early withdrawal and fixed interest — they can make a lot of sense while the Federal Reserve's next rate moves are unclear. Plus, with rates already near 5% APY or more on these accounts today, it could make sense to lock in a competitive rate that you can benefit from over the long run. Just make sure the CD type you choose matches your  financial goals before you sign up.

Start your search with today's top CD accounts here and start earning more money!

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