Here's How Much $5,000 Would Earn in a 6-Month CD Right Now

While there are certainly downsides to interest rates going up, one fantastic upside is that rates on CDs, or certificates of deposit, go way up. In fact, some of the best CDs are offering annual percentage yield (APYs) of more than 5%.

Some CDs have ridiculously high deposit minimums, but a $5,000 deposit will be enough for many highly competitive 6-month CDs. Here's what that could look like in terms of yield.

High-yield 6-month CDs

You won't find these kinds of rates from every bank, but the current top 6-month CDs are generally between 4.5% and 5.5%. (I haven't personally seen one over 6% yet. The current national rate cap is 7.21%.)

With $5,000 to deposit, here's how much you could earn:

(I assumed that funds compounded monthly. A CD that compounds daily may earn a bit more, but it'll be less than $1.)

So, where do you find these impressive APYs? Well, if you don't mind the lack of branches, online banks often have great rates. If you prefer the in-person touch, check out your local credit union. (Some of the highest rates I've seen came from credit unions.)

You may also want to check for any promotional CDs. You may find promotional offers with odd terms -- literally; I've seen 7-month and 9-month promotional CDs -- with remarkably high rates, while those banks' regular 6-month CDs wallow points behind the competition.

Average 6-month CDs

According to FRED data, the average rate for a 6-month CD is just 1.49%. But we all know that "average" means there are lots of CDs with lower rates. (I've seen a few as low as 0.03%!)

How much are those low rates going to cost you? Here's the yield from a $5,000 6-month CD at a more "average" rate:

I think the numbers speak for themselves on this one. A junky 0.03% interest rate from your big-name bank is going to earn you just $7.50 after six months. That's $106.06 less than you'd earn with a 4.5% APY.

If that doesn't make you pause, consider this: Given that inflation is currently 3.4%, you're actively losing value if your CD -- or savings account, or checking account -- earns anything less than 3.4%.

CDs vs. savings accounts

In general, CDs offer some of the highest APYs of any type of low-risk savings product. Provided you don't need access to the funds during the maturity period of the CD, they are a great place for your mid-term savings.

However, what if that savings is part (or all) of your emergency fund? It's really ill-advised to tie up that money for any period of time, even just six months.

Well, you may not have to worry about it. At this very moment, you can find high-yield savings accounts offering the same 5% APY as some of the best CDs. Even better, some banks offer new account bonuses for opening a new savings account and meeting certain deposit conditions.

In other words, you could earn a competitively high APY, not tie up your money, and earn a welcome bonus, all in one move. It's worth considering, in my opinion.

Whichever route you choose to go, just make sure you're not letting your funds lose value in a low-yield account. Your money should always be making you money.