What each account actually is
All three are bank deposit products backed by FDIC insurance, which covers up to $250,000 per depositor, per bank, for each ownership category. That part is identical across the three. What separates them is how locked up your money is, whether the rate is fixed or variable, and whether you can spend from the account directly.
High-yield savings account (HYSA)
A savings account that pays far more than the national average. The rate is variable, so it can move with the Federal Reserve, and you can withdraw whenever you need to — which makes it the default home for an emergency fund. Top online banks pay around 4.2% (Axos at 4.21%, Wealthfront and Newtek at 4.20%)[3], while the national average savings rate sits at just 0.38%[1].
Certificate of deposit (CD)
You agree to leave your money for a fixed term — three, six, or twelve months, or longer — in exchange for a fixed rate that won't change for the life of the CD. If you pull money out early, you pay a penalty, usually several months of interest (the exact amount varies by bank and term). The FDIC reports a 1.71% national average for 12-month CDs, and caps the advertised rate a bank can pay on a 12-month CD at 5.65%[1]. Bankrate's survey of the best 1-year CDs is higher than the national figure, around 2.05%[2].
Money market account (MMA)
A deposit account that behaves like a savings account but usually adds check-writing or a debit card. The rate is variable, and the national average is 0.63%[1]. Do not confuse it with a money market fund, which is an investment product sold by brokerages and is not FDIC-insured.
The rates, side by side
Rates below are the FDIC's national averages for August 2026, alongside the top advertised figures where they differ[1][2][3].
| Product | Typical rate | Liquidity | Best for |
|---|---|---|---|
| High-yield savings | ~4.2% top | Withdraw anytime | Emergency fund, short-term goals |
| CD (12-month) | 1.71% avg · 5.65% cap | Locked for the term | Cash you won't need for 6–12 months |
| Money market account | 0.63% avg | Check / debit access | Cash you want earning interest plus spending access |
Two caveats make these numbers less simple than they look. First, the national averages are dragged down by giant brick-and-mortar banks that don't compete on rate; the best HYSAs and CDs pay several times the average[1][3]. Second, the 5.65% figure is an FDIC cap, not a market rate — most savers will find top 12-month CDs closer to Bankrate's 2.05% average[2].
How to choose
The decision comes down to one question: when will you need this money?
- You might need it anytime → HYSA. The slight yield you give up versus a CD is the price of not being locked in. For an emergency fund or a goal within the next year, this is usually the right call.
- You know you won't touch it for 6–12 months → CD. A CD locks today's rate for the full term. The tradeoff is the early-withdrawal penalty, so only use money you're confident you can leave alone.
- You want to spend from the account → money market account. If check-writing or a debit card matters more than the highest rate, an MMA is convenient — but you'll typically earn less than a HYSA.
One more variable to weigh: where you think rates are heading. The Federal Reserve raised its target rate to 3.75%–4.00% on September 16, 2026[4]. A CD locks in whatever rate is on offer today, good or bad, while a HYSA adjusts as the bank changes its rate. If you expect rates to fall, a CD preserves the higher rate; if you expect them to keep rising, a HYSA lets you follow them up.
FAQ
What happens if I withdraw a CD early?
You'll pay an early-withdrawal penalty, typically several months of interest, and the exact amount depends on the bank and the CD's term. Some banks let you withdraw only the interest penalty-free, while others charge a percentage of the principal. Always read the penalty language before opening a CD.
Is a money market account the same as a money market fund?
No. A money market account is a bank deposit insured by the FDIC. A money market fund is an investment product sold by brokerages that aims to hold a $1 share price but is not FDIC-insured and can technically lose value.
Will savings rates keep rising?
Nobody can predict the Fed with certainty. After the September 16, 2026 hike to 3.75%–4.00%[4], online banks tend to pass higher rates through within weeks. Keep an eye on the Fed's statements and the FDIC's monthly rate data[1] rather than guessing.
Sources
- FDIC — National Rates and Rate Caps (August 2026) — fdic.gov
- Bankrate — CD rates (1-year CD average) — bankrate.com
- NerdWallet — Best High-Yield Online Savings Accounts — nerdwallet.com
- Federal Reserve — FOMC statement, September 16, 2026 — federalreserve.gov