What's a good CD interest rate this August?
Summary
Interest rates on certificates of deposit (CDs) are currently higher than earlier this year, making it a good time for savers to lock in rates. CD rates this August range from about 3.95% for 3-month terms up to 4.50% for 3-year terms, while traditional savings accounts offer much lower interest rates.Key Facts
- The Federal Reserve paused interest rate changes in its first five meetings this year but may raise rates in September.
- Inflation and oil prices rose due to the war with Iran, affecting interest rate trends.
- CD interest rates vary by term, with rates in August ranging roughly from 3.95% to 4.50%.
- Savers should shop around for the best CD rate and consider their ability to keep the money deposited for the full term.
- Early withdrawal from a CD usually results in fees that reduce earned interest.
- Traditional savings accounts currently offer about 0.38% interest on average.
- High-yield savings accounts provide rates close to top CD rates but allow flexible access to funds.
- High-yield savings rates can change over time, unlike fixed CD rates.
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