Best CD Rates Today, May 5, 2025: Lock in Up to 4.40% APY Ahead of the Next Fed Rate Decision

The Federal Reserve’s upcoming rate decision looms large, but investors can secure high yields now with 4.40% APY on select CDs—some of the highest rates in years. As short-term rates remain elevated, institutions like Marcus by Goldman Sachs and Popular Direct are offering standout opportunities.

The Top Rates to Act On Now

As of May 5, 2025, the highest APY is 4.40%, available through two institutions:

1. Marcus by Goldman Sachs:
2. Term: 14-month CD
3. Minimum Deposit: $500
4. Key Feature: No-penalty CDs allow withdrawals without fees after 7 days, while the “bump-rate” CD lets users request a rate increase once during the term.

5. APY Trend: The 14-month rate peaked at 4.40% in April 2025, up from 3.95% in late 2024, reflecting aggressive rate hikes to combat inflation.

6. Popular Direct:

7. Term: 3-month CD
8. Minimum Deposit: $10,000 (requires larger capital but offers a quick yield boost).
9. APY Trend: The 3-month rate surged from 3.35% in November 2024 to 4.40% by April 2025, capitalizing on volatility in short-term markets.

Why Act Now?

The Fed is expected to hold rates steady at 4.25%-4.50% in its May meeting, but longer-term declines could follow. Historically, CD rates lag behind Fed cuts, so locking in now preserves gains.

Other Standout Options

• Synchrony Bank: 13-month CD at 4.35% APY (no minimum deposit).
• Limelight Bank: 6-month CD at 4.35% APY (requires $1,000).
• CIBC Bank USA: 9-month CD at 4.31% APY (ideal for mid-term liquidity).

Key Considerations Before Choosing

1. Term Flexibility:
2. Marcus offers terms from 6 months to 6 years, while Popular Direct caps terms at 5 years.

3. Longer terms (e.g., 6-year CDs) at Marcus yield 3.75% APY, far below short-term peaks.

4. Minimum Deposits:

5. Smaller savers benefit from Marcus’ $500 minimum, while Popular Direct’s $10,000 threshold favors larger investors.

6. Early Withdrawal Penalties:

7. Marcus’s no-penalty CDs avoid fees, but most CDs incur penalties (e.g., Popular Direct’s 3-month CD charges 89 days of interest for early withdrawals).

The Fed’s Shadow Over Rates

The Fed’s 2024 rate hikes (peaking at 5.25%-5.50%) pushed CD yields to record highs, but markets now anticipate a gradual easing. Bankrate data shows the national average for a 1-year CD is just 1.77% APY, a stark contrast to top-tier offers.

Risks and Recommendations

• Rate Volatility: APYs can drop after the Fed’s June meeting if easing begins.
• Inflation Hedge: CDs with terms <18 months (e.g., Marcus’ 14-month CD) outperform inflation (currently 3.2% annualized).
• Liquidity Needs: Pair short-term CDs with longer-term bonds to balance yield and flexibility.

Conclusion: Act Strategically, Lock in Now

With 4.40% APY available on 14-month and 3-month CDs, investors have a narrow window to secure yields that outpace inflation and average savings accounts.

Top Picks:
- Aggressive savers: Marcus’ 14-month CD (4.40% APY, $500 minimum) for term flexibility and no-penalty options.
- High-capital investors: Popular Direct’s 3-month CD (4.40% APY) for a quick return, but pair it with longer-term CDs to avoid rollover risks.

The Fed’s next move could reduce these rates, so act swiftly. As of May 5, 2025, these are the highest yields available, but they may not last.

Data as of May 5, 2025. Rates are subject to change. Always confirm terms directly with institutions.