$100,000 short-term CD vs. $100,000 high-yield savings account: Which will earn more this year?
Summary
This article compares how much money a $100,000 deposit would earn in a short-term certificate of deposit (CD) versus a high-yield savings account in 2024. It shows that in most cases, a high-yield savings account earns slightly more interest, except for the six-month CD where the CD earns a bit more.Key Facts
- A short-term CD locks money for a set time (up to 12 months) with a fixed interest rate.
- A high-yield savings account has a variable interest rate and does not require locking up funds.
- At 3 months, a $100,000 CD at 3.90% earns $961.06; the savings account at 4.03% earns $992.62.
- At 6 months, a $100,000 CD at 4.10% earns $2,029.41; the savings account earns $1,995.10.
- At 9 months, a $100,000 CD at 4.00% earns $2,985.24; the savings account earns $3,007.52.
- The high-yield savings account pays more interest after 3 and 9 months, while the CD pays more after 6 months.
- Interest rates are currently high and expected to remain stable through 2024.
- Early withdrawal from a CD can result in a penalty, which could reduce earnings.
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