CDs vs. High-Yield Savings Accounts: Which Is Better in 2026?
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Savings rates soared in 2023 and 2024, but now they're on a slow glide path back down. Some online banks are still offering solid APYs in the 3.50% to 4.00% range on both short-term CDs and high-yield savings accounts. But with rate cuts looming, a lot of savers are asking the same question:
Should I grab a CD now and lock in the rate, or just keep my money in a flexible high-yield savings account?
Here's how I think about the trade-offs in 2026, and why I'm personally on team HYSA.
Comparing APYs and potential earnings
As of January 2026, some of the best short-term CDs are offering between 3.50% to 4.10% APY.
As for top high-yield savings accounts, they're sitting closer to 4.00% APY, but those rates are expected to dip if/when the Fed cuts this year.
So for a fair comparison, let's assume:
- You lock in a 12-month CD at 3.75%. This is a guaranteed return.
- You keep your cash in an HYSA that starts today around 4.00% but averages out to 3.25% for the next 12 months due to rate drops.
Here's what that comparison looks like in real dollars over one year:
| Account | Earnings on $10,000 |
|---|---|
| 12-month CD (3.75% APY) | $375 |
| HYSA (avg. 3.25% APY) | $325 |
That's a $50 difference on $10,000. Not nothing, but not life-changing.
If you've got $50K or more parked in cash, sure, that extra yield could be worth it. But for smaller balances -- or if you value the ability to access your money at any time -- CDs might not be worth it even at the higher APY.
And this is where the decision really gets personal. For me, that flexibility is worth way more than a $50 boost.
I keep all my cash in a LendingClub LevelUp Savings account, currently earning 4.00% APY with $250+ in monthly deposits. It's one of the top accounts around that I recommend for keeping your money accessible.
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LendingClub LevelUp Savings
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- Competitive APY
- No fees
- Easy ATM access
- Unlimited number of external transfers (up to daily transaction limits)
- Requires you to make monthly deposits to earn the best APY
- ACH outbound transfers limited to $10,000 per day for some accounts
- No branch access; online only
The LendingClub LevelUp Savings account has a lot to offer. At the top of the list is its high APY, though you must deposit monthly to earn the best rate. Next is zero account fees, a strong and straightforward perk. Finally, you get a free ATM card, which you can use to withdraw from thousands of ATMs nationwide. Interested? You can open an account with $0.
When CDs make sense -- and when they don't
Both CDs and HYSAs have some things in common. They typically have no monthly fees, are FDIC insured, and are super easy to open at most online banks.
But the products are built for different savings situations -- and knowing which one fits your goal makes all the difference.
CDs are great when:
- You want a guaranteed return without watching rates.
- You're saving for a specific date-based goal, like tuition, taxes, or a future purchase.
- You're comfortable leaving the money untouched for the full term.
HYSAs are better when:
- You want full access to your money, no questions asked.
- You're building or protecting your emergency fund.
- You like the option to pivot or move funds as rates or your goals change.
For most people, it's less about "which one is better" and more about what kind of flexibility (or certainty) they want right now.
In fact, you may find it's best to spread your money across both!
What to watch as rates shift in 2026
Nobody can predict what the Fed will do with core interest rates in 2026. But as of right now, the majority of interest rate traders (based on CME Group's FedWatch tool) aren't expecting any rate drop until mid-June. And a lot can change by then.
That means HYSA rates could hover at current levels for a while, making CDs less attractive.
That being said, banks aren't always waiting around for Fed decisions to drop APYs. So if you're definitely looking for a guaranteed return, locking in today's top APYs might be a smart move.
See today's top CD rates and terms.
Either way, if you're sitting on savings, don't let it sit idle in a low-rate account. Your money should always be working for you.
Our Research Expert
Joel O’Leary is a full-time Personal Finance Writer at Motley Fool Money, covering credit cards, bank accounts, investing, mortgages, and other personal finance topics. Joel has been writing about personal finance since 2018, previously leading editorial content for the How To Money podcast and serving as a resident writer at Budgets Are Sexy. He bought his first rental property at age 18, funding the down payment with savings from his high school job at McDonald’s -- a testament to his lifelong passion for smart money decisions. His work aims to make personal finance accessible and actionable for everyday readers. When he’s not writing, Joel enjoys surfing and spending time with his family.