Known for its moderate income and minimal risk, certificates of deposit (CDs) aren’t exactly exciting – but that doesn’t mean you should neglect them. Although rates began to decline toward the end of 2024, CDs can still offer good value: some of the most profitable CDs currently yield more than 4% per APY. If you’re looking for a deposit account that offers competitive returns and the security of FDIC insurance, consider opening a CD.
Not convinced? Read on to find out how much you could earn by putting $10,000 on a CD for five years.
If you look at national averages, CD prices probably won’t impress you. The average 60-month (five-year) CD earns an interest rate of 1.34%, according to the FDIC.
Fortunately, averages are just averages, and many banks and credit unions offer above-average CD rates. For example, America First Credit Union tops the list of best CD priceswith several terms offering interest rates around or above 4%.
The difference between earning the average interest rate and earning 4% may seem small, but the numbers tell a different story.
The table below shows how much you would earn over five years by depositing $10,000 into two different CDs: one earning the average 60-month CD rate of 1.34% and the other earning a more competitive rate of 4%. (For simplicity, calculations are based on APY.)
As the table shows, you would earn a total of $2,166.53 in interest over five years with a CD earning 4% APY. With an average CD, you would only earn $688.20. In other words, choosing the right CD for your $10,000 would earn you more than three times the interest compared to an average account.
CD rates and revenue per term
Interest rates also vary depending on CD term — that is, the number of months or years until the CD matures.
Traditionally, longer CD terms offer higher rates, but the economic environment can affect this trend. When interest rates are high and expected to fall in the near future, shorter CD terms can offer higher rates. Indeed, banks do not want to have to pay high rates for several years if the The Federal Reserve cuts rates.
According to the January 2026 FDIC report National tariffs and price caps12-month CDs currently offer the highest yield. Here’s a look at current rates for a variety of different CD terms and how much interest they would earn when they mature:
Keep in mind that the longer the term of the CD, the more time your money has to earn interest (and for that interest to earn interest). So even though the 60-month CD above earns a lower rate than the 12-month CD, it still earns more over its term.
Learn more: Short or long term CD: which is best for you?
CDs aren’t the only place where earn interest on your money. If the stiffness of a CD doesn’t make sense to you, consider these alternatives.
A High Yield Savings Account (HYSA) also allows you to get a competitive interest rate on your savings and your money is there when you need it. Unlike a CD, you can usually withdraw money from your HYSA whenever you need it. there may be monthly withdrawal limits.
Currently, the best high yield savings accounts pay rates comparable to top CDs, offering APYs of up to 4% APY. But keep in mind that rates may change after opening an account.
Learn more: Fixed rate vs variable rate: what is the difference and why is it important?
Money market accounts (MMA) work similarly to savings accounts, but they also include some features of checking accounts. For example, MMAs often earn competitive interest, but they also often come with checks and/or a debit card.
However, one drawback – and potential obstacle – is that MMAs sometimes have higher account minimums than savings accounts or CDs.
Currently, the best money market accounts offer APYs of up to 4.1%.
If you’re willing to take a little more risk for potentially higher returns, you might consider bonds.
Like CDs, some bonds provide fixed payments over a consistent period of time.
Technically, a bond is an investment. You, the investor, lend money to the government or a business; in exchange, you receive recurring payments at a fixed interest rate until the bond matures.
Although bonds are not federally insured like CDs are, they tend to be very low-risk investments. Bonds can also offer a little more flexibility: You can sell bonds before they mature, and although you’ll miss out on future returns, you may not have to pay penalties.
Note: Interest rates on HYSAs, MMAs and certain types of bonds may change after you make an initial deposit. Unlike CDs, this makes it impossible to predict long-term profits.
If you have $10,000 (or any amount of money) that you can put away for a while, a CD might be worth considering. Because CDs typically offer a fixed interest rate for the duration of their term, they provide predictable income. If you can afford to leave a $10,000 deposit for five years, you can open a CD knowing exactly how much you’ll earn.
However, be careful when putting money into a CD if you need to withdraw it before the account matures. If you do this, you will probably have to pay early withdrawal penalties.
If you need an account with more flexibility, a savings account or money market account may be a better option. On the other hand, if you are in the business for a longer period of time and are willing to take on more risk, you might consider investing that money in bonds, stocks, mutual funds, or ETFs.
Learn more: 3 Smart Things to Do When Your Savings Account Hits $10,000
The amount you would earn by putting $10,000 in a CD for five years depends on your interest rate, which varies by financial institution. As of January 2026, the national average rate for a five-year CD was 1.34%. At this rate, you would have a total of $10,688.20 after five years. However, if you could find a more competitive CD earning 4% APY, you would get $12,166.53.
CD income over a year depends on your CD rate. The higher your rate, the more you will earn. With the current national average one-year CD earning 1.61% APY, you would earn $161 in one year. At 4% APY, you would earn $400.
It depends on your priorities. If you’re earning an average rate, it’s probably not worth putting your money in a CD: You could earn more with the right savings account. However, if you can find a CD offering a more competitive rate, such as 4% APY, it may be worth considering.
Whether this is a good idea depends on how quickly you’ll need the money, whether you’re comfortable with it being inaccessible for a while, and whether you can find an alternative – like a HYSA – that offers comparable rates.
