Savers have their choice of high-earning interest-bearing accounts right now, thanks to today’s high-rate environment. After all, each time the Federal Reserve has raised its benchmark rate to try and temper inflation, consumer rates have gone up in tandem – and that includes the rates offered on accounts like high-yield savings accounts and certificates of deposit (CDs). And, with the Fed’s benchmark rate paused at a 23-year high, these accounts can be a simple, risk-free way to earn interest on your money. 

But given today’s economic unknowns – and the variable-rate nature of high-yield savings accounts – CDs in particular have become a popular choice for those seeking a low-risk, fixed-income option. Aside from today’s high rates, the main draw of opting for a CD over another type of interest-bearing account is that the rate is locked in when you open an account. So, you’ll earn the same rate for the full CD term – and won’t have to worry about rate changes until your CD matures. 

When your CD hits maturity, though, it’s essential to make informed decisions to maximize your returns and align your investments with your financial goals. So, if you want to get the most out of your CD, it helps to know your options once your account matures.

Explore today’s top-earning CD account options now.

6 smart options to consider when your CD matures

If your CD account is set to mature soon, you may want to consider making these moves when it does:

Negotiate the renewal rate with your current bank

One of the simplest options you have when your CD matures is to renew your CD with the same financial institution. However, rather than simply rolling it over automatically, it could make sense to take this opportunity to negotiate for better terms. 

For example, interest rates may have changed since you initially invested, and your financial institution might be willing to offer a higher rate to retain your business. Research current CD rates and use this information as leverage when discussing terms with your bank.

Find out more about the CD rates you could get today.

Open a CD with a higher rate at a new bank

Moving your funds to a new CD at a different bank can be a savvy move if you want to capitalize on better interest rates. Banks often compete to attract deposits, and you might find another institution offering more favorable terms for your investment. 

Before making the switch, though, be sure to conduct thorough research on various banks and their CD accounts. Take note of any promotional rates, special terms or loyalty incentives that could enhance your returns.

Transferring your funds to a new CD with a higher interest rate not only boosts your earnings but also allows you to reassess the market and diversify your banking relationships.

Diversify with a ladder strategy

You can also consider diversifying your investments by adopting a CD ladder strategy after your CD matures. Rather than putting all your funds into a single CD, you would distribute them across multiple CDs with varying maturity dates. 

This approach ensures that a portion of your investment becomes accessible at regular intervals, providing liquidity while taking advantage of potentially higher interest rates on certain CD terms. This strategy mitigates the impact of interest rate fluctuations on your overall portfolio — which can be a big benefit in today’s uncertain economic environment.

Explore a brokered CD

Brokered CDs offer an alternative to traditional bank CDs, providing access to a broader range of options and potentially higher yields. By working with a brokerage, you can choose from a variety of CDs issued by different banks, allowing you to optimize your returns. 

Keep in mind, though, that brokered CDs may have different terms and conditions than traditional CDs. As such, you should carefully review the offerings and learn about associated fees before making a decision.

Consider a high-yield savings account

If you’re looking for flexibility and liquidity without sacrificing too much on interest rates, consider moving your funds to a high-yield savings account after your CD matures. While the interest rates on high-yield savings accounts can vary over time, many accounts currently offer rates that rival the top CD account options. 

And, high-yield savings accounts provide easier access to your money, making them suitable for short-term financial goals or emergencies. As with any interest-bearing account, though, just be sure to compare rates across different banks to find the best option for your needs.

Invest in a short-term bond fund

If you’re willing to take on slightly more risk in pursuit of higher returns, short-term bond funds can be an attractive option. These funds invest in a diversified portfolio of short-term fixed-income securities, providing potential for capital appreciation and higher yields. However, it’s crucial to assess your risk tolerance and investment objectives before venturing into bond funds, as they are subject to market fluctuations.

The bottom line

As your CD approaches maturity, taking a proactive approach is crucial for optimizing your returns and aligning your portfolio with your financial goals. Whether you choose to negotiate for better CD terms, diversify with a ladder strategy, explore brokered CDs, consider high-yield savings accounts or invest in short-term bond funds, each option comes with its own set of benefits and considerations. Before making any decisions, though, be sure to assess your risk tolerance, liquidity needs and overall financial objectives. It can also help to stay informed about current market conditions and interest rate trends to make choices that align with your financial well-being.