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  1. Banking
  2. Certificates of Deposit

CD Rates Are Starting to Drop. Is It Too Late to Buy?

By: Adam Hardy
Adam Hardy, expert in Personal finance, student loans, credit, job market, low-income finances, and Lead data journalist at Money
Adam Hardy
Lead data journalist | Joined May 2024
Adam Hardy is a lead data journalist at Money, where he frequently reports on financial barriers that affect low-income Americans. Adam’s work has also appeared in Business Insider, Forbes, Nasdaq, The Penny Hoarder, Yahoo! Finance and many other outlets.
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Editor: Brad Tuttle
Brad Tuttle, expert in Personal finance, shopping, consumer trends, and Senior Editor at Money
Brad Tuttle
Senior Editor | Joined January 2014
Brad Tuttle is a senior editor at Money with over 10 years’ experience covering a vast number of personal finance topics, including careers, cars, travel, budgeting, investing, insurance, credit cards, consumer psychology, real estate, banking, and shopping and deals.
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Published: Feb 01, 2024 5 min read
Photo-illustration of hands reaching out with money before the arrow turns down.
Money; Getty Images

Payouts from certificates of deposit (CDs) are already beginning to fall in anticipation of benchmark interest rate cuts from the Federal Reserve later this year.

Due to their attractive APYs, CDs have become an increasingly popular, safe option for folks to park their savings. However, the days of CD rates above 5% are probably numbered. In recent weeks, several major online banks, including Ally, Barclays, Discover, Marcus, Sallie Mae and Synchrony, have started slashing their 12-month CD rates.

For instance, 12-month CDs at Barclays now come with an APY of 5.3% at press time, down from 5.5% last month. Similarly, Sallie Mae lowered its APY from 5.5% to 5.25% over that same period. Discover, Marcus and Synchrony have all cut their CD rates in recent weeks too.

During Ally’s latest earnings call on Jan. 19, CFO Russ Hutchinson said the bank has cut CD rates twice already in January and signaled more are coming in 2024.