Right here’s how a lot you’d earn by placing $10,000 in a CD for five years

Recognized for reasonable earnings and minimal danger, certificates of deposit (CDs) aren’t precisely thrilling — however that doesn’t imply it’s best to overlook them. Although charges began dropping towards the tip of 2024, CDs can nonetheless provide an excellent bang in your buck: A few of the highest-yielding CDs are at the moment incomes greater than 4% APY. In case you’re searching for a deposit account that provides aggressive returns and the security of FDIC insurance coverage, contemplate opening a CD.

Not satisfied? Learn on to learn how a lot you could possibly earn by placing $10,000 in a CD for 5 years.

In case you’re nationwide averages, CD charges most likely gained’t impress you. The typical 60-month (five-year) CD earns an rate of interest of 1.34%, in accordance with the FDIC.

Fortunately, averages are simply averages, and there are a lot of banks and credit score unions providing better-than-average CD charges. For instance, America First Credit score Union tops the listing of the greatest CD charges, with a number of phrases boasting rates of interest round or above 4%.

The distinction between incomes the common rate of interest and incomes 4% might not sound like so much, however the numbers inform a distinct story.

The desk under reveals how a lot you’d earn over 5 years by depositing $10,000 into two completely different CDs: One incomes the common 60-month CD charge of 1.34%, and one incomes a extra aggressive 4%. (For simplicity’s sake, calculations are based mostly on APY.)

Because the desk reveals, you’d earn a complete of $2,166.53 in curiosity over 5 years with a CD incomes 4% APY. With a median CD, you’d solely earn $688.20. In different phrases, selecting the best CD in your $10,000 would internet you greater than thrice the curiosity in comparison with a median account.

CD charges and earnings by time period

Rates of interest additionally fluctuate by CD time period — that’s, the variety of months or years till the CD matures.

Historically, longer CD phrases have provided greater charges, however the financial setting can have an effect on this development. When rates of interest are excessive and anticipated to drop within the close to future, shorter CD phrases might provide greater charges. That’s as a result of banks don’t wish to be on the hook to pay a excessive charge for a number of years if the Federal Reserve cuts charges.

Based on the FDIC’s January 2026 report of Nationwide Charges and Fee Caps, 12-month CDs at the moment provide the very best return. Right here’s a have a look at present charges for a wide range of completely different CD phrases and the quantity of curiosity they’d earn by the point they mature:

Take note, the longer the CD time period, the extra time your cash has to earn curiosity (and for that curiosity to earn curiosity). So although the 60-month CD above earns a decrease charge in comparison with the 12-month CD, it nonetheless earns extra over the course of its time period.

Learn extra: Quick- or long-term CD: Which is greatest for you?

CDs aren’t the one place to earn curiosity in your money. If the inflexibility of a CD doesn’t make sense for you, contemplate these options.

A high-yield financial savings account (HYSA) additionally means that you can earn a aggressive rate of interest in your financial savings, plus, your cash’s there while you want it. In contrast to a CD, you’ll be able to typically withdraw cash out of your HYSA each time you must, although there could also be month-to-month withdrawal limits.

Presently, the greatest high-yield financial savings accounts are paying charges akin to the highest CDs, providing APYs of as much as 4% APY. However remember that charges can change after you’ve opened an account.

Learn extra: Mounted charge vs. variable charge: What is the distinction, and why is it vital?

Cash market accounts (MMAs) work equally to financial savings accounts, however in addition they embrace sure traits of checking accounts. For instance, MMAs typically earn aggressive curiosity, however in addition they typically include checks and/or a debit card.

Nonetheless, one draw back — and potential roadblock — is that MMAs typically have greater account minimums in comparison with financial savings accounts or CDs.

Presently, the greatest cash market accounts are providing APYs of as much as 4.1%.

In case you’re keen to take barely extra danger for doubtlessly greater returns, you may contemplate bonds.

Like CDs, some bonds present mounted funds over a gradual time frame.

Technically, a bond is an funding. You, the investor, lend cash to the federal government or a company; in change, you obtain recurring funds at a set rate of interest till the bond matures.

Whereas bonds aren’t federally insured the best way CDs are, they are usually very low-risk investments. Bonds may provide barely extra flexibility — you’ll be able to promote bonds earlier than they mature, and when you’ll miss out on future returns, you could not must pay penalties.

Notice: Rates of interest on HYSAs, MMAs, and sure varieties of bonds can change after you make an preliminary deposit. In contrast to CDs, this makes it unattainable to foretell long-term earnings.

When you have $10,000 (or any amount of cash) you’ll be able to put aside for a time frame, a CD may be price contemplating. As a result of CDs typically provide a set rate of interest throughout their time period, they provide predictable earnings. In case you can afford to depart a $10,000 deposit alone for 5 years, you’ll be able to open a CD understanding precisely how a lot you’ll earn.

Nonetheless, be cautious about placing cash in a CD in the event you might must withdraw it earlier than the account matures. In case you do, you’ll seemingly must pay early withdrawal penalties.

In case you want an account with extra flexibility, a financial savings or cash market account could also be a greater possibility. Alternatively, in the event you’re working with an extended timeframe and are keen to tackle extra danger, you may contemplate investing that cash in bonds, shares, mutual funds, or ETFs.

Learn extra: 3 good issues to do when your financial savings account hits $10,000

The quantity you’ll earn by placing $10,000 in a CD for 5 years relies on your rate of interest, which varies by monetary establishment. As of January 2026, the nationwide common charge for a five-year CD is 1.34%. At that charge, you’d have a complete of $10,688.20 after 5 years. Nonetheless, in the event you may discover a extra aggressive CD incomes 4% APY, you’d find yourself with $12,166.53.

One-year CD earnings rely in your CD charge. The upper your charge, the extra you’ll earn. With the present nationwide common one-year CD incomes 1.61% APY, you’d earn $161 in a single yr. At 4% APY, you’d earn $400.

It relies on your priorities. In case you’re incomes a median charge, it’s most likely not price placing your cash in a CD — you could possibly earn extra with the precise financial savings account. Nonetheless, if you could find a CD incomes a extra aggressive charge, akin to 4% APY, it could be price contemplating.

Whether or not it’s a good suggestion relies on how quickly you’ll want that cash, whether or not you’re snug with it being inaccessible for a time frame, and whether or not you could find another — akin to an HYSA — that provides comparable charges.