Consumers kicked off the year facing a tough economic landscape. Collective credit card debt hit a record high of $18.04 trillion in the fourth quarter of 2024, rising $93 billion from Q3. Credit card payment delinquencies have also been climbing recently, indicating that Americans are feeling the pressure that today’s economy is putting on their budgets. And, inflation rose for the fourth straight month in January.

The financial strain caused by rising debt and inflation has pushed some savers to look for safe ways to earn a good return on their savings. Certificates of deposits (CDs) are one option worth considering, as the fixed rates on these deposit accounts have remained relatively high during the Fed’s rate pause. After all, many of the top CD accounts come with rates of at least 4% right now. 

So, if you’ve got a five-figure amount of money that you’d like to earn interest on — $20,000, for example — now is a good time to consider whether a CD account makes sense. How much will you earn from that $20,000 by next year, though? 

Maximize your interest earnings with today’s top CDs.

How much could a $20,000 CD earn by 2026?

With CD rates still high and the fixed rate of return protecting you from lower earnings amid concerns about inflation and possible future rate cuts, this type of account could make sense to consider. But before you open one, it can help to know what your returns could be. 

Here’s what a $20,000 CD can earn by 2026 based on today’s top rates: 

• 9-month CD at 4.35%: $649.01 for a total of $20,649.01
• 12-month CD at 4.40%: $880.00 for a total of $20,880.00
• 18-month CD at 4.16%: $1,260.89 for a total of $21,260.89

Choosing between the terms listed above is a matter of your financial needs and goals. A 9-month CD frees up your money quicker if you want the flexibility to change your savings strategy based on what happens with inflation and rates through the end of the year. If you’re a long-term saver who wants to generate bigger returns, an 18-month CD is likely the better choice. A 12-month CD blends flexibility with hefty returns.

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What other strategies can I use to maximize my CD returns?

If you’re looking to earn a bigger return on your $20,000 CD, consider using the following strategies: 

• Avoid withdrawals: Any money you withdraw from your CD before maturity will reduce your balance, and, in turn, the interest you earn. Some CDs also come with an early withdrawal penalty that is charged for withdrawing funds from your account before the account matures. The penalty can further reduce your returns. 
• Explore bonuses at your current bank: Some banks will offer you higher CD rates if you open a savings account with them when you open a CD. Keep in mind, though, that you may have to meet a savings account minimum balance requirement or opt for a specific CD term to get the bonus. 
• Shop around: Comparison shopping is one of the best ways to ensure you’re getting the top CD rate available. Research your own bank’s bonus offers and compare rates from traditional banks, credit unions and online banks. 

The bottom line

If you open one of today’s top CD accounts and deposit $20,000, you could earn anywhere from $649.01 to $1,260.89 by 2026, depending on the term and bank or credit union you choose. As you weigh different CD options, review your financial goals to see which term works best for you. If you prefer to have access to the funds in your CD, you may want to consider opening a no-penalty CD. These accounts won’t penalize you for withdrawals, but they typically have lower rates in exchange for their liquidity.