5 Top Tips for Maximizing CD Investment Returns

5 Top Tips for Maximizing CD Investment Returns It’s how we make money. But our editorial integrity ensures that our product ratings are not influenced by compensation. APY = Annual Percentage Yield. Image source: Getty Images There's a massive difference between CD offerings depending on which bank you use. Case in point: the national average APY for a 12-month CD right now sits around 1.63%. Meanwhile, some banks on the high end are offering close to 4.00% APY for that same 1-year term. That's why it always pays to shop around. If CDs are part of your plan for 2026, a little strategy goes a long way. Here are five tips to help you get the most out of your CDs. 1. Don't use your regular bank by default It might be convenient to just get CDs from your everyday bank. But that convenience can come at a big cost if your bank isn't offering competitive rates (and many big banks don't). For example, say you put $10,000 into a 12-month CD. At a competitive 3.75% APY, you'd earn about $375 in interest over the year. But if you blindly accept a CD offered by your regular bank that only offers 1.50% APY, that same deposit earns roughly $150. Same money. Same 1-year term. But you're leaving about $200 on the table just by sticking with the familiar option. That gap exists because big banks don't need to compete aggressively on rates. Online banks do. With lower overhead and fewer branches, they can afford to pay savers more -- and they usually do. Opening a CD at an online bank is typically quick, your funds are still FDIC insured, and the extra interest adds up fast. A great option to check out right now is Synchrony Online CDs , offering up to 4.10% APY with no minimum deposit requirement. Open Account for On Synchrony Bank's Secure Website. 2. Match the CD term to your timeline A great rate isn't worth much if you're likely to withdraw money early. Most CDs come with early withdrawal penalties, and those penalties can easily wipe out months of interest, or more. That's why investors should always think about when they'll realistically need the money before picking a term. The goal is to choose a maturity date that lines up with your actual plans so the CD works with your life, not against it. 3. Ladder CDs when it makes sense If you don't want to guess where rates are going, CD laddering is a solid middle ground. Instead of putting all your money into a single CD term, you can split your funds across multiple CDs with different maturities. That way, part of your money comes due every few months or years, giving you flexibility to reinvest or use your cash for other things. This strategy has gotten easier lately because many banks now offer no minimum deposit requirements. That means you can ladder even with smaller amounts. For example, opening four $250 CDs...

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