The Smartest Move I Made Before Buying a House? Opening a CD at the Right Time
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When I started saving for a house, I didn't expect a certificate of deposit (CD) to become one of the smartest financial moves I'd make. But opening a LendingClub CD in early 2024, just before the Federal Reserve began cutting rates, turned out to be perfect timing.
And smart savers have the same opportunity right now, before the Fed slashes rates again.
At the time, my high-yield savings account (HYSA) was earning nearly 5.00% APY -- but when the Fed cut rates at the end of 2024, that APY dropped fast. My CD, on the other hand, stayed put.
Because CDs lock in your rate for a set term, mine kept earning the higher yield while new offers fell. That single move ended up adding extra cash to my down payment, and it gave me a lot of peace of mind in a year when rates were changing almost monthly.
The power of locking in a fixed rate
Right now, LendingClub offers an 8 Mo. CD with a 4.10% APY. A $25,000 deposit would earn about $703 when the CD matured.
And you don't have to tie up your money for years. CDs give you predictable growth and protection from rate swings. That peace of mind is what you're really buying with a fixed-rate CD -- guaranteed growth no matter what the Fed decides next.
You're not too late to do the same
If you missed that pre-cut window before last month, don't count yourself out. The Fed's September 2025 cut likely wasn't the last one we'll see. The next meeting is scheduled for the end of October, and many analysts expect another reduction before the end of 2025.
That means there's still time to grab one of the stronger CD rates available now -- and lock it in before they move lower again.
LendingClub's 8 Mo. CD at 4.10% APY is one of the best offers on the market now, and it only has a $500 minimum deposit. You can open it online in minutes.
For many savers, that's the sweet spot: short enough that your cash isn't tied up for too long, but long enough to secure a strong, fixed rate through the next round of potential cuts.
LendingClub CD
On LendingClub's Secure Website.
Why I'd do it again
If you're saving for something specific -- a home, a car, or just building a cushion -- a short-term CD can be an easy way to earn more while keeping your money safe.
I still keep an HYSA for flexibility, but the CD gave me something I didn't realize I was missing: certainty.
Looking back, locking in that LendingClub CD didn't just help me earn more -- it helped me buy a home with confidence. And in today's rate environment, that kind of stability is worth every bit of interest it earns.
Our Research Expert
Brooklyn Sprunger is a full-time Content Manager and Personal Finance Writer at Motley Fool Money, where she oversees product reviews and ratings while also writing about credit cards, bank accounts, investing, auto insurance, and other personal finance topics. She has worked in financial content since 2018, including more than four years at The Motley Fool. When she’s not writing or editing, Brooklyn is likely hiking and watching the Tennessee Vols.