What is the best 5-year CD rate right now?

As of September 2026, the best 5-year CD rates from online banks and credit unions are paying 4.30%–4.50% APY. Traditional big banks typically pay 0.10%–1.00% APY on 5-year CDs — far below top online rates. Always verify the current rate directly with the institution before opening an account.

How much does a $10,000 5-year CD earn?

At 4.40% APY, a $10,000 5-year CD earns approximately $2,402 in total interest over 60 months with daily compounding. That brings the total value at maturity to $12,402. At the FDIC national average rate of 1.36% APY, the same $10,000 earns only about $699 — a difference of more than $1,700.

Is a 5-year CD a good investment in 2026?

A 5-year CD at 4.30%–4.50% APY is a reasonable choice in late 2026 for money you won't need until 2031, especially given that top 5-year rates are now roughly in line with 1-year rates — a change from earlier in 2026, when shorter terms paid noticeably more. Locking in above 4.30% now protects you through any future rate-cutting cycle.

What is the early withdrawal penalty on a 5-year CD?

Most banks charge 150–365 days of interest as the early withdrawal penalty on a 5-year CD. On a $10,000 CD at 4.40% APY, a 365-day penalty costs approximately $440. This is nearly a full year of interest. Only open a 5-year CD if you are very confident you will not need the funds before 2031.

How do 5-year CD rates compare to I-bonds and Treasury bonds?

As of September 2026, the best 5-year CD rates (4.30%–4.50% APY) are competitive with or above recent 5-year US Treasury note yields — check the current yield at TreasuryDirect.gov or the Federal Reserve's H.15 release before comparing, since Treasury yields move daily. CDs offer FDIC insurance (up to $250,000), while Treasuries carry the backing of the US government and are exempt from state income tax. I-bonds offer inflation protection but have strict purchase limits ($10,000/year per person) — confirm the current I-bond composite rate at TreasuryDirect.gov, as it resets every six months.

5-Year CD Rates 2026 — Best 60-Month Certificate of Deposit APYs Today

The best 5-year CD rates in September 2026 are paying 4.30%–4.50% APY at online banks and credit unions. On a $10,000 deposit, that’s approximately $2,343–$2,462 in guaranteed interest over 60 months — the longest standard CD term, fully FDIC-insured.

Rates shown are as of September 2026, based on Bankrate, CNBC Select, and WalletHub rate surveys published this month. Verify the current rate directly with the institution before opening an account.

Best 5-Year CD Rates — September 2026

Institution Type	APY	Minimum Deposit	Early Withdrawal Penalty
Top online banks/CUs	4.35%–4.50%	$0–$2,500	150–365 days interest
Mid-tier online banks	4.00%–4.35%	$0–$5,000	150–365 days interest
National average (FDIC, Aug 2026)	1.36%	Varies	Varies
Traditional big banks	0.10%–1.00%	$500–$2,000	150–365 days interest

What a $10,000 5-Year CD Earns

APY	Total Interest Over 5 Years	Total at Maturity
1.36% (national avg)	$699	$10,699
4.30%	$2,343	$12,343
4.40%	$2,402	$12,402
4.50%	$2,462	$12,462

Figures use A = P(1+APY)^5, consistent with the APY convention. Actual amounts vary by institution.

Example: James has $40,000 he received from selling property and won’t need until retirement in 2031. He opens a 5-year CD at 4.40% APY, earning approximately $9,608 in guaranteed interest over five years. The money is fully FDIC-insured — check the current inflation rate (bls.gov CPI release) to gauge his real return over the term.

How 5-Year CD Rates Compare to Short-Term Rates Right Now

Earlier in 2026, 5-year CD rates were noticeably below 1-year rates — a partially inverted yield curve reflecting expectations of Fed cuts. By September 2026, that gap has largely closed: top 5-year rates (4.30%–4.50%) are now roughly in line with top 1-year rates (4.30%–4.44%), after the Fed held its target range at 3.50%–3.75% for most of the year.

The implication: locking a 5-year CD today no longer means giving up meaningful yield relative to shorter terms, while it protects you from any future rate declines through 2031. If the Fed resumes cutting, a 5-year CD locked now will look increasingly attractive relative to CDs renewed at that time.

5-Year CD vs. Other Terms

CD Term	Top Rate (September 2026)	Total Interest on $10K	Lockup
3 months	3.90%–4.25%	~$99	90 days
6 months	4.15%–4.30%	~$210	180 days
1 year	4.30%–4.44%	~$435	12 months
2 years	4.30%–4.40%	~$889	24 months
3 years	4.30%–4.50%	~$1,379	36 months
5 years	4.30%–4.50%	~$2,402	60 months

The 5-year CD produces the most total interest in absolute terms, and — unlike earlier in 2026 — no longer requires accepting a materially lower annual rate than the 1-year CD to get it.

5-Year CD vs. US Treasuries

A common alternative to a 5-year CD is the 5-year US Treasury note. Check the current yield at TreasuryDirect.gov or the Federal Reserve’s H.15 release before comparing — Treasury yields move daily and can be above or below top CD rates depending on market conditions.

Feature	5-Year CD (Top Online Bank)	5-Year Treasury Note
Current yield	4.35%–4.50% APY	Confirm current yield at TreasuryDirect.gov
Federal insurance	FDIC (up to $250K)	US government backing
State income tax	Taxable	Exempt from state tax
Liquidity	Penalty for early exit	Tradeable on secondary market
Minimum investment	$0–$2,500	$100

For high-earners in states with significant income tax (for example, California’s top marginal rate is above 12%; New York’s is above 10%), the state tax exemption on Treasuries adds meaningful value — confirm current state tax brackets before estimating the after-tax benefit. For everyone else, top CD rates and Treasury yields are worth comparing side by side at the time you’re shopping.

See CDs vs. Treasury Bills for a full comparison.

When a 5-Year CD Makes Sense

Good fit for:

Money with a 5+ year timeline (education funds, planned retirement supplement, estate liquidity)
Savers who want to lock in a rate above 4.30% before any future Fed cuts reduce long-term rates
Conservative investors who want FDIC-backed certainty over a long horizon

Not a good fit for:

Emergency savings or money you might need before 2031
Investors willing to accept some market risk for potentially higher returns (bonds, dividend stocks, balanced funds)
People who believe interest rates will rise significantly — locking in now could mean missing higher future rates

Early Withdrawal Penalty Risk

The early withdrawal penalties on 5-year CDs can be severe — up to 365 days of interest at some banks. On a $10,000 CD at 4.40% APY:

180-day penalty: ~$217 (roughly 6 months of interest forfeited)
365-day penalty: ~$440 (nearly a full year of interest forfeited)

If you withdraw in year 1 with a 365-day penalty, you may receive less than you deposited in net terms. Before opening a 5-year CD, ask the institution what the exact early withdrawal penalty is.

Alternative: Some institutions offer callable CDs or bump-up CDs for longer terms — these can be useful if you’re worried about missing better rates, though they carry their own trade-offs. See Callable CDs and Bump-Up CDs for detail.

CD Ladder Strategy with 5-Year CDs

One of the most powerful applications of a 5-year CD is at the long end of a CD ladder:

Year 1: Open a 1-year CD
Year 2: Open a 2-year CD
Year 3: Open a 3-year CD
Year 4: Open a 4-year CD (or add to 3-year)
Year 5: Open a 5-year CD

After five years, you have one CD maturing every 12 months, all earning 5-year rates. Annual maturities provide liquidity while the long-end rate anchors your returns above short-term fluctuations.

See the CD laddering strategy guide for full instructions.

Written by WealthVieu

WealthVieu researches and writes data-driven personal finance guides using primary sources including the IRS, Bureau of Labor Statistics, Federal Reserve, and Census Bureau.

The content on Wealthvieu is for informational purposes only and should not be considered financial, tax, or investment advice. Consult a qualified professional before making financial decisions. Full disclaimer · Editorial policy