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There are few financial guarantees, especially in today’s economic climate. With inflation on the rise again and interest rate cuts on pause, savers must be strategic with where they store their money. Fortunately, there’s still at least one way to protect and grow your savings: a certificate of deposit (CD) account.
Unlike accounts with variable interest rates like traditional savings accounts and high-yield ones, the rates on CDs are fixed for the full CD term. This offers security for savers, as they won’t have to worry about changes in the larger rate climate. But it also offers predictability, as they can easily determine how much they’ll earn when the account reaches its maturity date.
And even though interest rates on CDs have declined over the last 12 months, they’re still elevated compared to recent years. With rates in the 4% to 5% range, then, savers have multiple ways to earn hundreds of dollars on their money. And with the right lender and initial deposit, they can earn $500 with a CD this year. Below, we’ll explain how.
See how much more you could be earning with a top CD account here.
How to earn $500 with a CD in 2025
To determine how much you can earn with a CD you’ll need three figures: the interest rate, the term (or length) of the CD and the amount of money deposited upon opening. Using a few readily available rates and terms, then, here’s how savers could earn $500 with a CD this year (assuming no fees or early withdrawal penalties):
Deposit $23,000 into a 6-month CD
A $23,000 deposit into a 6-month CD with a rate of 4.55% will result in about $520 earned by July. While that deposit amount may seem high, you’ll regain access to your funds by mid-summer, allowing you to move your money around again relatively soon – reducing the risk of having to pay an early withdrawal penalty to regain access to your money. And you’ll gain protection against any market volatility to come in the first half of 2025.
Start making money with a CD now.
Deposit $15,500 into a 9-month CD
If you want to deposit less but are willing to keep your money in a CD for another 90 days or so, a 9-month CD at a 4.40% rate could be beneficial. Depositing $15,500 into this account now would result in a $509 return upon maturity, bringing your total funds to just over $16,000 by October.
Deposit $12,000 into a 1-year CD
While you technically won’t be able to access your funds until early January 2026, a 1-year CD can still be a smart way to earn $500 or more on your money now. And you can earn it by making the smallest deposit on this list. A $12,000 deposit into a 1-year CD with a rate of 4.50% made this month will lead to $540 earned by next January. That’s more than $1 earned per day, every day, for the next year simply made by moving some of your funds into this type of account.
The bottom line
While CD rates have declined from where they were in January 2024, they’re still a safe and reliable way to earn a good return on your money now. While all of the above options offer a clear path toward earning a $500 return, they’re not the only viable way to do so. You can deposit less or more and extend or shorten your term, depending on your personal preferences. Just be sure to explore online banks, too, as they tend to offer higher returns than banks with physical branch locations. And remember that CD interest earned has tax consequences that will need to be accounted for when you file your 2025 tax return.
Learn more about your current CD account options here.