How Much Could $50,000 Earn in Today’s Top-Paying CDs?

If you have $50,000 just sitting in a savings account, you’re in luck. The median savings balance in the U.S. is $1,200, meaning your savings balance is more than 41 times above the middle. Yeah — good job.

But unless you’ve earmarked that $50,000 for an emergency or some immediate goal, leaving it in a savings account may not be the savviest decision. While many high-yield savings accounts have high APYs right now, those rates are likely going to change later this year. You might be reluctant to put your money in high-risk investments, like stocks. However, for potentially higher returns over a longer period, a certificate of deposit (CD) could be a great place to put your $50,000.

How much would $50,000 yield in today’s best CDs? Let’s take a look at some terms and find out.

A short-term CD could yield $2,625 per year (for a 1-year CD)

A short-term CD is generally considered one with a term between one and 12 months. Currently, these CD terms offer the highest APYs, which is typically not the case. Normally, banks offer higher APYs on longer terms, as they want to give an incentive to keep your money stored in their vaults for longer periods. This trend was reversed during the Fed’s latest round of interest rate hikes, which elevated all CD rates, but especially those that mature in the near term.

Investing $50,000 in a short-term CD could produce $2,625 annually, but your yield will depend on the term you choose. For perspective, here’s how much you could earn from today’s top short-term CDs.

Term APY (current Bank Yield on $50,000
3 months 5.41% Western Alliance Bank (via Raisin) $682.50
6 months 5.00% LendingClub $1,250
9 months 5.55% NASA Federal Credit Union $2,081
1 year 5.25% Marcus by Goldman Sachs $2,625

Data source: CD issuers. CD rates are current as of Feb. 1, 2024.

With a 1-year CD, you could earn around $2,625, assuming you locked in at an APY of 5.25%. Shorter terms would yield slightly less overall, but they’d mature faster, giving you access to your money sooner. These yields also assume you won’t withdraw early (incurring a penalty) or withdraw your interest monthly or quarterly, which would reduce your earnings overall.

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A long-term CD could yield $2,375 per year (for a 3-year CD)

If short-term CDs are those with terms 12 months or below, then long-term CDs are those with terms longer than 12 months. These CDs have slightly smaller APYs, but they let you lock in today’s best rates for a longer period. For perspective, here’s how much the top long-term CDs could earn.

Term APY Bank Yield on $50,000 (per year)
2 years 4.50% Bask Bank $2,250
3 years 4.75% First Internet Bank of Indiana $2,375
4 years 4.45% Popular Direct $2,225
5 years 4.30% Quontic $2,150

Data source: CD issuers. CD rates are current as of Feb. 1, 2024.

Earning more than $2,000 in a fixed income investment is a good deal — especially if inflation remains below your APY. Of course, you’d also pay taxes on your CD interest, thus reducing your rate. But for little to no risk, you could get a guaranteed return for a long period.

Consider a CD ladder

You don’t have to invest $50,000 in a single CD. Instead, you could divide your money into both short and long CD terms, otherwise known as CD laddering. This lets you lock in high rates for longer periods, while also giving you more frequent access to your savings. You might even want to throw in a few no-penalty CDs, just to give yourself a risk-free escape in case you need cash fast.

All in all, today’s best CD terms present a rare opportunity to get decent returns with little risks. Weigh the pros and cons of CDs carefully, but if you have $50,000 in a savings account, moving it into a CD might be a savvy move to make in 2024.

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