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Forbes
06-05-2025
- Business
- Forbes
CD Rates Today: May 6, 2025 - Earn As Much As 5.02%
Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations. Today's highest CD rate is 5.02% for a 1-year CD. CD rates from online banks are commonly twice as high as the national average rates. CD ladders let you leverage high rates without locking up all of your money long-term. Today's best interest rates on CDs (certificates of deposit) are as high as 5.02%. Rates vary by term and often fluctuate, and they are expected to fall as the Federal Reserve lowers interest rates. A CD is a specific type of savings account (known as a time deposit account) that comes with a fixed interest rate and a maturity period. CDs, depending on the yield, typically offer better yields than high-yield savings accounts. The tradeoff is that you can't access your cash until the CD matures, otherwise you'll owe a withdrawal fee. The longer the term, the harsher the early withdrawal penalty. It's not unusual to lose one full year's worth of interest or more if you break open a five-year CD too soon. Be absolutely certain you understand the penalty before you make your investment. Three-month CDs are a good option for short-term savings goals. The current average rate on a three-month CD sits at 1.3%, but the highest rate is 4.67%. The average rate is unchanged from a week ago. If you're interested in a short-term CD with high yields, consider a six-month CD . The best rate today is 4.94%. The current average APR for a six-month CD is 1.78%, about the same as last week. The highest interest rate currently available on a one-year CD—one of the most popular CD terms—is 5.02%. If you land a rate in that vicinity, you're getting a good deal. That rate hasn't changed much since last week. The average APY, or annual percentage yield, on a one-year CD is now 1.83%, unchanged from a week ago. If you can hold out for two years, 24-month CDs today are being offered at interest rates as high as 4.52%. That's the same as this time last week. The average APY for the CD is 1.66%, flat to last week's average. Today, the highest rate on a three-year CD stands at 4.27%, so you'll want to shop around for that rate or something near it. The average rate APY is 1.58%. The highest rate available today for a five-year CD is 4.26%. The average APY is 1.59%, similar to last week. The longer the term, the higher the early withdrawal penalty. It's not unusual to lose one full year's worth of interest or more if you break open a five-year CD early. Be absolutely certain you understand the penalty before you make your investment. The best rate today on jumbo CDs is 4.94% for a 6-month term. As with non-jumbo, various term lengths are available. The average APY for the 6-month CD is currently 1.82%. Most jumbo CDs require a minimum deposit of $100,000—and some even require $250,000. However, there's no universally agreed-upon definition regarding what qualifies as a "jumbo" CD. Some banks and credit unions slap the label "jumbo" on CDs you can open with $50,000, $25,000 or even less. Related: CD Interest Rates Forecast: How Good Will They Get? CD rates are rarely the same between any two banks, so you should comparison shop when looking for a new account. You may decide to stick with your current bank because it's convenient or join a new bank to take advantage of higher rates. To find the right CD, look at the specific term you're interested in with a few different banks. Traditional, brick-and-mortar banks tend to offer lower CD rates, in general, than online banks without any branches. For example: Other top CD rates by banks include: You "purchase" a CD from a financial institution by opening an account with a lump-sum deposit, which is your principal. Many CDs and share certificates (accounts similar to bank CDs but offered by credit unions) have minimum deposits you must meet, which typically range from a few hundred to several thousand dollars. Once you deposit your principal, the clock starts on your timed investment, and you begin earning interest. The bank or credit union will provide you with regular statements showing how much you're earning. You may accrue interest daily, monthly or quarterly. Try not to tap your CD before the term ends. Early withdrawal penalties can be so severe that they negate your interest and then start eating into your principal. CDs typically pay higher interest than other savings vehicles, even the best high-yield savings accounts and money market accounts . And while they may not offer the kind of enviable returns that are possible with stocks, CDs beat the more attention-getting investments in one regard: They're one of the safest places to put your money. Investors lost millions in the 2022 crypto crash, and putting your money into the stock market, real estate or gold and other commodities can be risky, too. But when you buy a certificate of deposit or credit union share certificate from a federally insured financial institution, you can sleep easily with the knowledge that your investment is protected. The Federal Deposit Insurance Corp. provides you with up to $250,000 in coverage in the event the bank issuing your CD ever fails. For share certificates purchased from federal credit unions and most state-chartered credit unions, the National Credit Union Administration insures your money up to the same limit. Traditional brick-and-mortar banks have far greater operating expenses than banks that only exist online. That's why online banks are usually able to offer more attractive APYs on CDs – they have lower overhead costs, so they can afford to pay higher interest rates to customers. Related: CD Interest Rates Forecast: How Good Will They Get? Curinos determines the average rates for certificates of deposit (CDs) by focusing on specific CDs and excluding others. Certain types, such as promotional offers, relationship-based rates, private, youth, senior, student/minor, affinity, bump-up, no-penalty, callable, variable, step-up, auto transfer, club, gifts, grandfathered, internet-only and IRA CDs are not considered in the calculation. Frequently Asked Questions (FAQs) You build a CD ladder by saving your money in multiple CDs with cascading term lengths. For instance, you might buy a one-year CD, a two-year CD, a three-year CD, a four-year CD and a five-year CD. As each of the shorter-term CDs matures, you replace it with a new five-year CD. Follow this plan and you'll have one better-yielding five-year CD maturing each year. If you're ever having a bad year, you could take some of the cash from the expiring CD and use it to pay bills instead of pouring it all into a fresh CD. Comparison shop to track down the best CD rates . Banks and credit unions compete by offering alluring yields to land your business, so shopping around is a must before you purchase any bank CD or credit union share certificate. CDs usually come with zero fees, meaning your money won't be nibbled at by the monthly maintenance fees that are typical with many savings, checking and money market accounts. You will likely be charged an early withdrawal penalty if you end your CD term early. Make sure you won't need access to your cash in the meantime.
Time of India
03-05-2025
- Business
- Time of India
Post office vs bank FD: Highest 3-year interest rate on fixed deposit for Rs 5 lakh investment in 2025
Tired of too many ads? Remove Ads Current interest rate on Post Office 3-Year Time Deposit Tired of too many ads? Remove Ads Highest interest rate in 3-year banks FDs Popular in Wealth Current FD rates for 3-year FDs for general public Axis Bank 6.90 Bandhan Bank 7.25 DBS Bank 6.50 DCB Bank 7.50 Federal Bank 7.00 HDFC Bank 6.90 ICICI Bank 6.90 IDFC FIRST Bank 6.25 IndusInd Bank 7.25 Karnataka Bank 6.50 Kotak Mahindra Bank 6.90 RBL Bank 7.50 South Indian Bank 6.70 YES Bank 7.50 PUBLIC SECTOR BANKS Bank of Baroda 7.15 Bank of India 6.50 Bank of Maharashtra 6.50 Canara Bank 7.20 Central Bank of India 6.75 Indian Bank 6.25 Indian Overseas Bank 6.50 Punjab National Bank 6.75 Punjab & Sind Bank 6.00 State Bank of India 6.75 Union Bank of India 6.70 How much will you earn if you invest Rs 5 lakh now? For risk-averse investors looking for guaranteed returns, fixed deposits (FDs) remain the go-to investment option. Banks are on a spree to reduce the FD interest rate (after the Reserve Bank of India cut the repo rate). The government, on the other hand, has not reduced the interest rate on the small savings schemes, including the Post Office Time Deposit (POTD), yet. If you are looking to book fixed deposits at the highest interest rate, then which one is better in 2025? Here is a detailed comparison to help you make an informed Post Office 3-Year Time Deposit offers an interest rate of 7.10% per annum, compounded quarterly and paid annually. The current interest is valid till June 30, 2025. For the next quarter (July-September), the government will review the interest rate and can change is a government-backed scheme offering sovereign guarantee, making it one of the most secure investment opportunities available. Post Office Time Deposits provide peace of mind with guaranteed returns and no chance of default. However, the Post Office FD does not provide special rates for senior citizens, and the interest is paid annually. There is no option to get interest from the Post Office FD on a cumulative basis, i.e., at the time of comparison, several private banks still offer higher interest rates on fixed deposits. DCB Bank RBL Bank , and YES Bank lead the pack with 3-year FDs offering 7.50% per annum, followed by Bandhan Bank and IndusInd Bank at 7.25% per annum, and Canara Bank at 7.20% per annum. Bank of Baroda also slightly edges out with a 7.15% interest rate per the other hand, many major banks, including Axis Bank ICICI Bank , and Kotak Mahindra Bank , are offering 6.90% per annum on 3-year FDs for general citizens. This is 20 basis points lower than the interest rate offered by the Post Office FD. Several public sector banks such as SBI PNB , and Indian Bank also offer between 6.25% and 6.75% to the general public. This makes the Post Office FD more attractive in comparison. While the difference in returns may seem marginal over three years, the Post Office's government backing provides an additional layer of safety, especially for conservative Paisabazaar as on April 30, 2025If you invest Rs 5 lakh in the Post Office FD at 7.10% per annum (compounded quarterly), the maturity amount after 3 years will be approximately Rs 6,17,538. This gives you total interest earnings of Rs 1,17,538 over the if you invest the same amount in banks offering lower rates, such as SBI, HDFC, ICICI, Axis, or Kotak-all offering around 6.90%, the maturity amount would be about Rs 6,14,598, resulting in Rs 1,14,598 interest. That's nearly Rs 2,940 less than the Post Office the other hand, banks offering higher interest rates, such as DCB, RBL, and YES Bank at 7.50%, would give you a maturity value of approximately Rs 6,24,487, or Rs 6,949 more than the Post Office FD. Similarly, Canara Bank at 7.20% would give around Rs 6,19,911, slightly higher than the Post Office summary, if you invest Rs 5 lakh:Post Office FD (7.10%): Rs 6,17,538Most large banks (6.90%): Rs 6,14,598Top private banks (7.50%): Rs 6,24,487
