In an economy marked by turmoil and uncertainty, a certificate of deposit can be a wise way to keep your funds safe. Since your rate is locked when you open your account, it also provides a guaranteed return. In contrast, the rate of savings accounts is variable and can change at any time under market conditions.
Today’s best CDs have an annual percentage yield (or APY) of up to 4.50%, more than three times the national average of a certain degree. To see how much interest you can earn, here is what you earn by depositing $5,000 into today’s top CDs.
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Read more: Best CD rates for March 2025: Increase your earnings by up to 4.65%
How much money can you make by depositing $5,000 into a CD?
If you have $5,000 for CD, here are sample income for several epidemic periods: six months, one year, three years and five years.
Your income of $5,000 in deposit
| semester | Top APY | bank | Interest income | CD value at maturity |
|---|---|---|---|---|
| 6 months | 4.50% | Community-wide federal credit union | $92.55 | $5,092.55 |
| 1 year | 4.40% | Bask Bank; Community-wide federal credit unions | $220.00 | $5,220.00 |
| 3 years | 4.15% | The first credit union in the United States | $648.69 | $5,648.69 |
| 5 years | 4.20% | The first credit union in the United States | $1,141.98 | $6,141.98 |
As of April 2, 2025, according to banks we tracked on CNET. The gain is based on APY and assumes that interest is more complex every year.
As of April 2, 2025, the national average of one-year CDs was 1.78% APY, while the average of one-year CDs in the top banks tracked in CNET was 4.06% APY. How does this differ on your interest income?
If you deposit $5,000, the maturity of the CD for one year is $5,089 for one year. However, if you earn 4.40% of the APY (the highest APY in the CDs we tracked), you end up with a total value of $5,220.00.
How much money can you make by depositing other amounts?
If you want to put more or less money into CDs, you can still get competitive interest rates. Here are examples of interest income for other deposit amounts.
Your income is different
| semester | Top APY | $1,000 deposit | $2,500 Deposit | $10,000 deposit | $25,000 deposit |
|---|---|---|---|---|---|
| 6 months | 4.50% | $22.25 | $55.63 | $222.52 | $556.31 |
| 1 year | 4.40% | $44.00 | $110.00 | $440.00 | $1,100.00 |
| 3 years | 4.15% | $129.74 | $324.35 | $1,297.38 | $3,243.46 |
| 5 years | 4.20% | $228.40 | $570.99 | $$ 2,283.97 | $5,709.91 |
As of April 3, 2025, APY is based on the highest APY offered by banks we track on CNET. Earnings assume interest increases every year.
How to calculate CD interests
APY on the CD represents the rate of return you receive in 12 months. CDS gets compounded, which means you have earned the initial deposit amount and any interest so far.
Complex interest rates vary for all banks. Your CD will complicate your CD every day, weekly or monthly. The more frequent interest compounds are, the more money you earn. You can use the CD calculator to determine how much interest your CD can earn.
How to choose the right CD for you
A good APY is important when you are looking for a CD, but there are other important factors to consider. Ask yourself these questions when choosing a CD:
- When do I need my money? Each CD has a set period and you cannot withdraw the fines early during the semester. CD terms usually range from six months to five years, so choose one that suits your schedule.
- Do I meet the minimum deposit requirements? Some CDs do not have a minimum deposit requirement, but others may require a deposit of $1,000 or more. How much money you have to invest can help you narrow down your choice.
- What’s the fare? Some CDs charge fees, such as monthly maintenance or early withdrawal fees. These fees may be brought into your income. Read the beautiful print of any CD you are considering so that you know what to sign up for.
- Is the bank insured? The CDS of Federal Deposit Insurance Companies insured by the National Credit Union Administration and Credit Union Insurance Banks are protected by up to $250,000 per account. Look for CDs from these institutions to keep your funds safe.
