Best CD Rates in May 2025: Newtek Bank Leads with 5.55% APY for 6 Months

Essential Insights for Savvy Savers

• The previous top rate of 5.65% for a 3-month CD has expired, elevating Newtek Bank’s 6-month 5.55% APY to the leading position nationwide.
• Ten CD options now offer 5.35% or higher with terms ranging from 9 to 15 months, enabling rate locks through 2025.
• Mid-term CDs (2-3 years) provide yields between 5.00% and 5.25%, while 4- and 5-year CDs deliver solid returns in the upper 4% range.
• Though rates have eased slightly from last fall’s historic peaks, they remain robust amid cautious market expectations for future Fed rate cuts.

Explore the best available CD rates below, curated from our nationwide partner institutions and rankings.

Lock in Attractive 5.35% to 5.55% Rates for Terms Up to 15 Months

With the recent withdrawal of the 5.65% 3-month CD, Newtek Bank now offers the highest overall CD rate at 5.55% APY for 6 months, securing your earnings through late 2024.

For those seeking longer rate security, ten CDs paying at least 5.35% lock in yields for 9 to 15 months, including NexBank’s standout 1-year CD at 5.40% APY.

Secure Longer-Term Rates That Extend Through 2026 and Beyond

Opting for CDs with terms of two years or more is a strategic choice amid anticipated potential Fed rate declines over the coming years. Credit Human offers a flexible term CD at 5.25% APY available for 18 to 23 months, extending your rate lock until spring 2026.

Longer terms of up to 3 years offer rates of 5.00% or higher, with 4- and 5-year CDs providing competitive yields in the upper 4% range, guaranteeing returns well into 2027 or later.

Major U.S. Bank Emerges as a Competitive CD Rate Provider

While smaller banks and credit unions usually lead CD rates, BMO Alto, the digital division of one of the nation's largest banks, offers the top 5-year CD rate. BMO Alto provides competitive rates across a range of terms from 6 months through 4 years.

CD Yields Remain Near 20-Year Highs

Since peaking at 6.50% in October, CD rates have moderated slightly. The number of CDs paying 5.50% or more has decreased from 30 to 8, yet rates remain historically elevated compared to the last two decades.

Locking in yields between 4% and 5% for extended terms still represents an excellent opportunity to outpace inflation and grow your savings effectively.

Keep in mind, timing your investment to secure long-term rates before potential rate declines in 2024 and 2025 can maximize your returns beyond simply chasing the highest APY today.

Pro Tip

Current CD rates effectively counter inflation, which hovers around 3.5%. Investing in high-yield CDs today lets you stay approximately 1-2 percentage points ahead, preserving your purchasing power.

Jumbo CDs Offer Enhanced Rates in Select Terms

Some jumbo CDs surpass standard options, such as State Bank of Texas’s 12-month CD at 5.50% APY and State Department Federal Credit Union’s 15-month CD at 5.41% APY.

However, jumbo CDs don’t always guarantee higher yields than standard CDs. Presently, standard CDs outperform jumbo options in six out of eight common terms, so comparing both types before committing is advisable.

Forecast for CD Rates in 2024

To combat historic inflation levels, the Federal Reserve raised interest rates aggressively from March 2022 through July 2023, reaching a 22-year high. Higher Fed rates typically push banks to offer better returns on CDs and deposit accounts.

This led to unprecedented CD rate peaks in late 2023, creating lucrative opportunities for savers.

Since the Fed's last hike in July, rates have plateaued with six consecutive meetings holding the benchmark steady. This pause reflects a cooling inflation trend but also uncertainty about when cuts might begin.

Fed Chair Jerome Powell emphasized that progress against inflation remains insufficient for rate reductions, indicating a longer wait before cuts are implemented.

Fed officials expect inflation to gradually ease but warn it could extend into 2025, delaying potential rate decreases.

Market consensus currently anticipates the first Fed rate cut around mid-September 2024.

Recent inflation data from April shows a slight dip to 3.4% CPI, suggesting continued vigilance before policy changes.

Accordingly, CD rates are expected to hold at current levels for several months, with possible declines once rate cuts commence.

The Fed's upcoming meetings this year, including one on June 12, will provide further direction.

Additional Savings Opportunities

Top high-yield savings accounts now offer up to 5.00%, while money market accounts provide rates up to 4.40%, complementing CD investments.

Important Note

All "top rates" highlighted here reflect the highest nationally available CDs identified through ZAMONA’s comprehensive daily research across hundreds of banks and credit unions. These top rates far exceed national averages, which are lowered by large banks paying minimal interest.

Our Methodology for Identifying the Best CD Rates

ZAMONA tracks over 200 federally insured banks and credit unions daily to rank the highest-paying CDs across all major term lengths. Eligible institutions must offer CDs with minimum deposits no greater than $25,000 and be accessible in at least 40 states. Credit unions requiring donations of $40 or more for membership are excluded to ensure broad availability.

For full details on our selection process, please consult our comprehensive methodology overview.

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