icon
icon
icon
icon
🏷️$300 Off
🏷️$300 Off

News /

Articles /

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

Henry RiversMonday, May 5, 2025 6:33 am ET
3min read

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.

BPOP, MCS
Name
PopularBPOP
The MarcusMCS

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.

Comments

Add a public comment...
Post
User avatar and name identifying the post author
joaopedrosp
05/05
High CD rates now, but Fed's next move could chill 'em. Lock in if you're comfy with short terms. 🧐
0
Reply
User avatar and name identifying the post author
Ok-Memory2809
05/05
4.40% APY? Sweet returns! Just watch out for those early withdrawal penalties. No free lunches here.
0
Reply
User avatar and name identifying the post author
Howell--Jolly
05/05
Short-term CDs are hot, but longer terms offer lower rates. Balance is key, folks. Not all CDs are created equal.
0
Reply
User avatar and name identifying the post author
Surfin_Birb_09
05/05
$AAPL dividends can't keep up with these CD rates.
0
Reply
User avatar and name identifying the post author
Chotibobs
05/05
@Surfin_Birb_09 How long you holding $AAPL? Curious if you're thinking long-term or looking to cash out soon.
0
Reply
User avatar and name identifying the post author
jy725
05/05
Fed rate cuts? Maybe, but I'm locking in now.
0
Reply
User avatar and name identifying the post author
ultrapcb
05/05
APYs dancing like $TSLA stock—grab high yields while Fed rates tango.
0
Reply
User avatar and name identifying the post author
spacecadet501st
05/05
@ultrapcb True, GRAB yields before rates dip.
0
Reply
User avatar and name identifying the post author
DrConnors
05/05
@ultrapcb APYs moving wild, right?
0
Reply
User avatar and name identifying the post author
GoStockYourself
05/05
CD rates are hot right now, not gonna last.
0
Reply
User avatar and name identifying the post author
Opening-Finger-4294
05/05
Holy!I profited significantly from the signal generated by META stock.
0
Reply
User avatar and name identifying the post author
Greysisbae
05/05
@Opening-Finger-4294 What was your META strategy? Curious how you profited.
0
Reply
Disclaimer: The news articles available on this platform are generated in whole or in part by artificial intelligence and may not have been reviewed or fact checked by human editors. While we make reasonable efforts to ensure the quality and accuracy of the content, we make no representations or warranties, express or implied, as to the truthfulness, reliability, completeness, or timeliness of any information provided. It is your sole responsibility to independently verify any facts, statements, or claims prior to acting upon them. Ainvest Fintech Inc expressly disclaims all liability for any loss, damage, or harm arising from the use of or reliance on AI-generated content, including but not limited to direct, indirect, incidental, or consequential damages.
You Can Understand News Better with AI.
Whats the News impact on stock market?
Its impact is
fork
logo
AInvest
Aime Coplilot
Invest Smarter With AI Power.
Open App