Here’s How Much You Could Earn Investing $2,500 in a CD Today

If you have $2,500 that you don’t need for the next three to 36 months, a certificate of deposit (CD) is a great place to deposit it and watch it grow. The best rates on a CD today range from 4.68% to 5.50% APY, depending on the term. Investing $2,500 in the 18-month CD with the top rate of 5.50% could result in over $200 in interest.

Top CD Rates Today and Interest Earned on $2,500 at Term End

The top rate on a CD of any term today is 5.50%, which applies to a 19-month CD from Hyperion Bank. At that rate, you could earn $221.17 in interest after 19 months.

If you need your money back sooner—remember, there are early withdrawal penalties on CDs—a 1-year term with a rate of 5.25% may be better. If you invested $2,500 in the top paying 1-year CD today, you’d earn $131.25 in interest.

CDs may be a better alternative to savings accounts if you want to earn a high interest rate and do not need that money in the immediate future. The highest savings account rate is currently 5.02% APY. Most of the best CD rates—those on 6-month, 1-year, 18-month, 2-year, and 3-year terms—pay more than the highest savings account rate today.

CD Rates Today

The national average annual percentage yields (APY) on CDs are much lower than the top rates offered from nationwide banks and credit unions today. The interest rate on a CD can greatly impact the amount of money you earn on your deposit.

For example, the current national average rate for a 1-year CD is 1.49% APY. If you invested $2,500 in a 1-year CD with that rate, you’d earn $37.25 when the term ended. But by choosing to invest $2,500 in a CD with a top rate of 5.25% for one year, you’d earn $131.25—$94 more.

Alternatives

If you don’t want to lock your money in a CD for a certain amount of time, a high-yield savings account may be a good alternative. The highest savings account rate currently pays 5.02%, and after one year, you could earn $125.50 on a deposit of $2,500. And with a savings account, you have the flexibility of withdrawing money when needed—and adding money as you have additional funds to save.

Just beware that interest rates on CDs and savings accounts are high right now, but there is no certainty that they’ll keep rising. Most market forecasters expect the federal funds rate—the interest rate set by the Federal Reserve that drives CD and savings rates—to rise only slightly higher in coming months. And there’s a chance it could be pulled back before 2023 ends. With that in mind, you might want to invest extra money in a CD now to lock in a higher interest rate that you can enjoy for months or potentially years to come, regardless of what the Fed decides.

Rate Collection Methodology Disclosure

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD's minimum initial deposit must not exceed $25,000.

Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don't meet other eligibility criteria (e.g., you don't live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.