What to do if your CD matures in 2025

If you opened a certificate of deposit (CD) account in 2023 or early 2024, you likely were able to lock in a high interest rate. With rates then often over the 5% mark – and some, for select savers, as high as 6% or 7% – CDs became the clear choice for savers looking to safely grow their money. But the interest rate climate of recent years is markedly different than what it is now at the start of 2025. The Federal Reserve issued three interest rate cuts last year, combining for a full percentage point lower than where the federal funds rate started in 2024. And that's caused both borrowing costs and rates on savings vehicles to decline, in some cases by a significant amount.

This is a real concern for savers, particularly for those with CD accounts set to mature in 2025, in this different rate climate. That said, CD interest rates are still favorable and relatively high. Savers will just need to take some strategic steps now, ahead of their account's 2025 maturity date, to keep their high returns. Below, we'll break down three things they should consider doing now.

Start by seeing how much you could earn with today's top CD rates here.

What to do if your CD matures in 2025

Here are three moves savers can make, either independently or in conjunction with one another, ahead of their CD's pending 2025 maturity date:

Take advantage of the grace period

Your current CD account won't just automatically roll over into a new, lower-rate account. You'll typically have a CD grace period of a week or so to decide on what to do with your funds, so use this time to make the right financial decision. Tell your lender what you intend to do before the period ends to avoid having the CD locked into a new account. 

If you don't utilize this period appropriately (or, better yet, get working on it before the grace period kicks in), you could wind up having your money moved into a different CD account, at which point you'd need to pay an early withdrawal penalty to regain access to your funds. Be proactive to avoid this scenario.

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Consider shifting it into a long-term CD

Sure, on the surface it may seem counterintuitive to move your money from a higher-rate short-term CD to a lower-rate long-term one. Right now, 6-month CDs, for example, have rates around 4.61% while rates on a 3-year CD are just 4.25%. But that longer CD term will easily negate the difference in rates, as you'll earn just $230 (on a $10,000 deposit) with the 6-month CD and approximately $1,300 with the 3-year one. So, if you can afford to keep your money untouched for the new, longer term, it makes sense to do so. Not only will you earn a bigger return, but you'll also protect your funds against wider market volatility for a much longer period.

Look to CD laddering

CD laddering, in which savers split their money among different CD accounts with varying maturity dates, was a preferential option for some in recent years to avoid missing out on future rate hikes. But it could still be a smart strategy for savers now. By putting some of their funds into a long-term CD, they'll earn that higher return noted above, and by putting the rest into a short-term CD, they'll earn a higher rate and maintain some flexibility that they would otherwise have to forego by putting all of their money into a CD with a multiple-year term. That noted, this strategy will require some nuance and extra work, both of which can be avoided by simply moving the funds into a long-term CD while rates are still relatively high.

The bottom line

Not each of these CD strategies will apply to every saver. In the current interest rate climate, it'll become more difficult to earn a high CD rate. However, it won't be impossible. Ahead of your pending 2025 CD account maturity date, consider making one or more of these moves — and be sure to incorporate online banks and lenders into your decision-making process, as they tend to offer better rates and terms than banks with physical branch locations.

Have more CD questions? Review your options online today.