Still deciding between a high-yield savings account or CD? Here are their main differences

High-yield savings accounts have become a popular vehicle for depositing and growing savings since they allow account holders to earn significant interest on their balances. But when it comes to stashing away your cash, there's another option some individuals may want to consider.

Certificate of deposit accounts (CD accounts) operate similarly to high-yield savings accounts in some ways, but the two have some very important differences.

High-yield savings accounts let you earn a higher interest rate (compared to traditional savings accounts), which in turn allows your money to grow even faster as it sits in your account. Their interest rates are variable, so can go up and down at any time, and there's usually a limit of six withdrawals or transfers per month.

Beyond a high APY, consider any fees associated with the account. For example, some accounts will charge a monthly maintenance fee if you don't meet certain requirements, such as keeping a minimum balance in the account.

We ranked the Marcus by Goldman Sachs High Yield Online Savings as the best high-yield savings account for no fees. And if you want the opportunity to earn even more extra cash, the SoFi Checking and Savings account offers a welcome bonus. For more information, check out our full list of the best high-yield savings accounts.

CDs are another type of deposit account, offering yields competitive to that of high-yield savings accounts. The big difference is that CDs have term lengths where you money is locked up for a specific amount of time, generally ranging between three months and five years. Tapping your funds before your term is up can cost you an early withdrawal penalty.

Another big difference with CDs is that their interest rates are fixed, meaning they don't change once you open an account; you'll have the same rate throughout your CD's term. You can generally only make one deposit into a CD and no other additional contributions until your term is up.

Similar to choosing a high-yield savings account, picking the right CD will largely depend on the APY it offers. But you should also carefully consider the term length of your CD to make sure you're comfortable locking up your money for that long.

When it comes to CD accounts, we ranked the Bank5 Connect as the best option for locking up your money for six months. If you're comfortable locking up your money for a longer period of time, the Bread Savings™ CDs lets you do that for up to five years. See our full list of the best CD accounts for more.

Opening a CD can be a good idea if you're saving up for a large purchase — like a home or a car — that you hope to make within the next six months to two years and you want your money to grow faster without having to worry about stock market volatility. However, you still have to make sure that you are depositing money you definitely won't need for that time period, since you can be penalized for withdrawing money before your term is over.

Because of this, CD accounts are not the best for creating an emergency fund. Emergencies can pop up when you least expect them. Because of this unpredictability, you never know when you'll need to make an account withdrawal. In this case, a high-yield savings account would be a much better fit for growing your emergency fund.

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every savings article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of banking products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

Catch up on CNBC Select's in-depth coverage of credit cards, banking and money, and follow us on TikTok, Facebook, Instagram and Twitter to stay up to date.

* New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received within 25 calendar days of your first Eligible Direct Deposit of $1 or more) OR $400 (with at least $5,000 total Eligible Direct Deposits received within 25 calendar days of your first Eligible Direct Deposit of $1 or more). Cash bonus amount will be based on the total amount of Eligible Direct Deposit received within 25 calendar days of your first Eligible Direct Deposit of $1 or more. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 5/15/2026 and will be available through 12/31/26. See full bonus and annual percentage yield (APY) terms at sofi.com/banking/checking-offer/ *SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC. SoFi members with Eligible Direct Deposit can earn up to 3.10% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.10% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 5/28/26. There is no minimum balance requirement. Fees may reduce earnings. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. *SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC's regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks. *Earn up to 3.80% Annual Percentage Yield (APY) on SoFi Savings with a 0.70% APY Boost (added to the 3.10% APY) for up to 6 months. Open a new SoFi Checking & Savings account with Eligible Direct Deposit by 12/31/26. Rates variable, subject to change. Terms apply at sofi.com/banking#2. SoFi Bank, N.A. Member FDIC *Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 5/28/26. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet