ETFs & Funds
Home›ETFs & Funds›Fund Industry›Still-rare 5% CDs persist, but typical yields sit arou…
Still-rare 5% CDs persist, but typical yields sit around 3% to 4%
With the effective federal funds rate sliding from 5.33% to 4.33% since late 2024 and further cuts taking the target range to 3.50% to 3.75%, most current CD offers cluster near 3% to 4% APY, leaving 5% terms mainly as limited promotions.
CDs can remain attractive for savers, but a 5% rate is much harder to find than it was during the period of high benchmark rates. Yahoo Finance notes that while some institutions still offer 5% certificates of deposit, they are not common, and buyers typically need a rate around three times the national CD average to reach 5%.
The shift reflects how CD yields tend to move with the Federal Reserve’s policy rate. Between August 2024 and January 2025, the effective federal funds rate fell from 5.33% to 4.33%, and additional cuts in 2025 lowered the target range to 3.50% to 3.75%, leaving the best CD rates generally hovering around 3% to 4% APY.
Where 5% CDs do show up, they are often limited-time promotional offers and can come with account restrictions, including credit union membership requirements. Yahoo Finance says membership eligibility is frequently tied to geographic areas or certain groups, which can narrow who can open the highest-yield CDs.
One example highlighted is A+ Federal Credit Union’s StartUP Share Certificate, which offers 5% APY on up to $1,000 for 12 months, with a $10 minimum balance. The article also notes that members can boost dividend rates further through rewards points for meeting certain targets, though the details shown are incomplete in the provided text.