CD vs. High-Yield Savings: Which earns more interest on $75,000 over one year?

Savers might see a significant boost to their returns as the Federal Reserve considers raising interest rates in September, a move that would mark a reversal after multiple cuts in late 2025 and earlier that year. According to CME Group's FedWatch tool, there's approximately a 50% chance of a 25 basis point increase in the benchmark interest rate.

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The Federal Reserve, which issued three interest rate cuts in the final four months of 2025 after following the same pattern in 2024, could now raise rates when it meets again in September.

This potential rate hike, while potentially challenging for borrowers, presents a favorable development for savers who have grown accustomed to elevated returns on their money. Accounts like high-yield savings and certificates of deposit (CDs) have offered attractive options for earning interest, and the current climate suggests these opportunities may continue, especially for those making substantial deposits.

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According to the CME Group's FedWatch tool, there's around a 50% chance the central bank bumps up its benchmark interest rate by 25 basis points when it meets again, its first such increase in multiple years.

For instance, a $75,000 deposit could yield considerable returns. Comparing a 1-year CD with a fixed rate of 4.40% against a high-yield savings account with a variable rate of 4.10% (assuming it holds steady for a year), the CD is projected to earn more. The CD would yield $3,300 in interest over the year, while the savings account would generate $3,075, resulting in a $225 difference in favor of the CD.

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Between a CD and a high-yield savings account, however, which will earn more interest over the next year with a deposit of this size?

While the 1-year CD is calculated to be more profitable in this scenario, the article notes that the high-yield savings account's variable rate means its earnings are not guaranteed to remain static. Market conditions could influence its rate, potentially altering the final interest earned. However, with current high rates holding steady and a low likelihood of an immediate drop, savers can still approximate their potential earnings with reasonable confidence.

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$75,000 1-year CD at 4.40%: $3,300.00 $75,000 high-yield savings account at 4.10% after one year: $3,075.00