A CD ladder is a strategy where you split your savings across CDs with different maturity dates (e.g., 1-year, 2-year, 3-year). As each CD matures, you reinvest in a new longer-term CD. This gives you regular access to funds while capturing higher long-term rates.

Best CD Rates of 2026

Lock in guaranteed returns with today's highest CD rates

UPDATED April 6, 2026 — Rates verified weekly

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Certificates of Deposit (CDs) offer a guaranteed return in exchange for locking up your money for a fixed term. In 2026, the best CD rates range from 4.25% to 5.00% APY depending on the term length. Shorter terms (3-6 months) offer solid rates with more flexibility, while longer terms (3-5 years) can lock in today's elevated rates before potential Fed cuts.

Best CD Rates by Term

3-Month CDs

Bank	APY	Min. Deposit	Early Withdrawal Penalty
Marcus (Goldman Sachs)	4.50%	$500	90 days interest
Ally Bank	4.40%	$0	60 days interest
Bread Savings	4.45%	$1,500	90 days interest

6-Month CDs

Bank	APY	Min. Deposit	Early Withdrawal Penalty
CIT Bank	4.75%	$1,000	3 months interest
Barclays	4.70%	$0	3 months interest
Discover	4.65%	$2,500	3 months interest

1-Year CDs

Bank	APY	Min. Deposit	Early Withdrawal Penalty
Bread Savings	4.95%	$1,500	6 months interest
Marcus	4.85%	$500	6 months interest
Capital One	4.70%	$0	3 months interest

2-Year CDs

Bank	APY	Min. Deposit	Early Withdrawal Penalty
Barclays	4.60%	$0	6 months interest
Ally Bank	4.50%	$0	5 months interest
Synchrony	4.45%	$0	6 months interest

3-Year CDs

Bank	APY	Min. Deposit	Early Withdrawal Penalty
Marcus	4.40%	$500	9 months interest
Discover	4.30%	$2,500	9 months interest
CIT Bank	4.25%	$1,000	12 months interest

5-Year CDs

Bank	APY	Min. Deposit	Early Withdrawal Penalty
Bread Savings	4.50%	$1,500	12 months interest
Barclays	4.35%	$0	12 months interest
Ally Bank	4.25%	$0	5 months interest

See how your CD will grow: Use our compound interest calculator to project your total return over the CD term.

CD Basics Explained

A Certificate of Deposit (CD) is a time-deposit account that pays a fixed interest rate for a set term. When you open a CD, you agree to leave your money deposited for the full term — typically 3 months to 5 years. In exchange, the bank guarantees a fixed APY that will not change regardless of what happens to market rates.

CDs are ideal for money you do not need immediate access to, such as savings for a home down payment in 2 years, a car purchase next year, or simply a portion of your emergency fund that you want to earn more on.

Key terms to know:

APY (Annual Percentage Yield): The total amount of interest you earn in one year, including compound interest. Higher is better.
Term: The length of time your money is locked in the CD. Longer terms sometimes (but not always) offer higher rates.
Maturity date: The date when your CD term ends and you can withdraw your money without penalty.
Grace period: A window (usually 7-10 days) after maturity when you can withdraw or renew without penalty.

CD Ladder Strategy

A CD ladder is one of the smartest ways to use CDs. Instead of putting all your money in one CD, you split it across multiple CDs with staggered maturity dates. Here is how a simple 5-rung ladder works with $10,000:

$2,000 in a 1-year CD (4.95% APY) — matures in 12 months
$2,000 in a 2-year CD (4.60% APY) — matures in 24 months
$2,000 in a 3-year CD (4.40% APY) — matures in 36 months
$2,000 in a 4-year CD (4.35% APY) — matures in 48 months
$2,000 in a 5-year CD (4.50% APY) — matures in 60 months

Each year, when the shortest CD matures, you reinvest it into a new 5-year CD. After 5 years, you have a CD maturing every year, giving you annual access to funds while earning the higher rates of longer-term CDs.

Benefits: Regular access to money, diversification against rate changes, and higher average yields than keeping everything in a savings account.

Early Withdrawal Penalties

If you need to access your CD funds before the maturity date, most banks charge an early withdrawal penalty. Common penalties by term:

CDs under 1 year: 3 months of interest
1-year CDs: 6 months of interest
2-3 year CDs: 6-9 months of interest
4-5 year CDs: 12 months of interest

The penalty comes out of your earned interest, not your principal (unless you withdraw very early and have not earned enough interest). To avoid surprises, always check the early withdrawal terms before opening a CD.

Alternative: Some banks offer no-penalty CDs that let you withdraw early without any fee. These typically offer slightly lower rates than standard CDs.

Frequently Asked Questions

What is a CD?+

A Certificate of Deposit (CD) is a savings product where you deposit money for a fixed term (3 months to 5+ years) in exchange for a guaranteed interest rate. CDs typically offer higher rates than savings accounts because your money is locked in for the term. They are FDIC-insured up to $250,000.

Are CDs safe?+

Yes. CDs at FDIC-insured banks are protected up to $250,000 per depositor, per bank. Your principal and interest are fully guaranteed regardless of stock market performance or economic conditions. Every bank on our list is FDIC-insured.

What is a CD ladder?+

A CD ladder is a strategy where you split your savings across CDs with different maturity dates (e.g., 1-year, 2-year, 3-year, 4-year, 5-year). As each CD matures, you reinvest in a new longer-term CD. This gives you regular access to funds while capturing higher long-term rates and averaging out rate fluctuations.

What happens if I withdraw early from a CD?+

Most banks charge an early withdrawal penalty, typically 3-6 months of interest for shorter terms and 6-12 months for longer terms. The penalty is deducted from your earned interest. Some banks offer no-penalty CDs that let you withdraw without a fee, though these typically have lower rates.

Are CDs better than savings accounts?+

CDs are better if you do not need access to the money for a set period and want a guaranteed rate that will not change. Savings accounts are better if you need flexibility and immediate access. In a falling rate environment, CDs are advantageous because they lock in today's higher rates. Consider using both: a savings account for your emergency fund and CDs for money you can set aside for a fixed term.

Related Tools & Comparisons

Compound Interest Calculator — Model how your CD earnings compound over the full term
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Budget Tracker — Plan your savings goals and allocate funds between CDs and savings
FIRE Calculator — See how CDs and savings fit into your financial independence plan
Retirement Calculator — Plan your overall retirement savings strategy

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