If you are weighing secure places to keep cash, a 16-month CD can be a compelling option. These time-deposit accounts typically pay more than standard checking or savings, though returns vary widely by institution.
Banks with the best CD rates today
CD yields remain relatively elevated by historical standards. Rates have edged lower since last year as the Federal Reserve reduced its target range, but many banks, especially online institutions, are still advertising competitive offers of 4% APY or higher.
As of Thursday, August 20, 2026, the top nationally available rate is 4.30% APY, offered by Synchrony Bank on a 16-month CD, according to the bank.
Several other institutions are also posting strong returns today, with a number of accounts above the 4% APY mark.
CD rate predictions for 2026
Policymakers began lowering the federal funds rate amid easing inflation and a firmer economic outlook, cutting the benchmark three times in late 2024 for a total of one percentage point. The central bank announced a third cut of 2025 in December of that year. So far in 2026, rates have been held steady and analysts see rising odds of a hike before year-end.
Deposit rates are not set directly by the federal funds rate, but the two tend to move together. As the Fed eased policy and then held steady, banks broadly trimmed CD yields, even as gas prices mid-August hit record high for the season.
That is why locking in a competitive rate now may appeal to savers who want predictable returns.
How to open a CD
Steps can differ by bank, but the general process includes:
- Research CD rates: Compare current offers and look for a competitive APY.
- Choose an account that meets your needs: Consider the term, minimum deposit, and fees. Avoid locking in longer than your timeline to reduce the risk of early withdrawal penalties.
- Get your documents ready: Expect to provide your Social Security number, address, and a government-issued ID.
- Complete the application: Many institutions allow you to apply online, with decisions often delivered quickly.
- Fund the account: Transfer money from another account or send a check to start the CD.