Why I'm Not Opening Any CDs in 2026 -- Even With Rates Near 4%

Just last year, finding a 4.00% CD wasn't too difficult. But now in early 2026, it's a bit tougher. Banks have gradually lowered APYs over the past few months, and it's widely expected that the Fed will cut interest rates one to two times this year.

Of course, a CD paying an APY of 4.00% (or something in that ballpark) is nothing to scoff at. Compared to where rates were just a few years ago, today's CDs are still paying relatively well.

But even with generous and guaranteed returns, I'm not opening any this year. Here's why.

1. I don't want to lock up my emergency fund

Right now, top CD rates and high-yield savings accounts (HYSAs) are nearly identical. You can find both earning near 4.00% APY from trusted online banks.

I understand that HYSA rates are variable and can change anytime. But the guaranteed return of a CD isn't a big enough reason for me to lock in.

A 12-month CD at 4.00% APY would tie up my money for a year. And if something unexpected comes up, withdrawing early could mean losing several months' worth of interest.

Meanwhile, high-yield savings accounts have no holding or withdrawal restrictions. My funds stay accessible, and I continue earning daily interest at a historically great rate.

Even if savings rates decline slightly in 2026 (say from 4.00% to 3.50%), the actual difference on a $10,000 balance is about $50 per year. That small gap simply isn't worth giving up full access to my money. The whole reason I keep emergency cash is so I can use it if I'm out of work for a long period and don't want to sell my investments.

To peek at today's top APYs, check out these best high-yield savings accounts to keep your money flexible.

2. Short-term Fed rate expectations signal stability

According to the CME FedWatch Tool, there's very little expectation for significant rate movement in the next few months. That tells me the current landscape with both HYSAs and CDs isn't likely to shift much in the short term.

One of the main advantages of a CD is protection against falling rates. But if rates stay steady, a liquid account provides roughly the same interest income and the freedom to move money as needed.

I know, I know… rates can change fast and I should rely on market predictions because I could be eating my words tomorrow. But this is what I see currently.

If you'd rather play it safe now, compare the top-paying CDs available here.

3. CDs don't really fit my money goals right now

Some 3- to 5-year CDs are paying up to 3.75% APY right now.

But that still doesn't quite fit my personal plan.

My wife and I save a hefty chunk of each paycheck we get. And we've still got a long runway before we're thinking about pulling the trigger on retirement.

So our focus with excess savings in 2026 is to invest it and grow as much wealth as we can. This means mostly index funds inside retirement and brokerage accounts. Even if this strategy carries short-term market risk, the long-term upside potential is much greater than CDs.

If we're setting aside money for the next 10, 20, or 30 years, we'd rather put those dollars into something that can compound at 8%-10% per year -- not 3.75%.

CDs still play an important role for conservative savers. But for my needs this year, I'm sticking with a high-yield savings account for my liquid savings. And if I do lock up any of my funds, it's for the long term in a higher-growth investment account.