Question: I have $150,000 that I don't need anytime soon, but I don't want to put it in the stock market. What should I do?
Answer: If you're looking for a risk-free place to store your money, my best solution is a jumbo CD. Jumbo CDs come with FDIC insurance up to $250,000 and APYs that'll outpace inflation.
However, there are a few things you want to consider before signing up for one. I'll cover key considerations, how much you can earn and why now is the right time to get one.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
How does a jumbo CD work?
A jumbo CD is a type of savings account that requires a large deposit, typically between $10,000 - $100,000. Similar to regular CDs, you'll open an account with an initial deposit and let it grow through its term.
If you need to withdraw it before the maturity date, you'll have to break your term. Doing so results in significant penalties, reducing the interest you'll earn on your investment. The longer your CD term is, the higher the penalties you'll incur.
What's beneficial about jumbo CDs is that they require shorter terms of six months to a year, so you'll have quick access back to your cash. Explore and compare options quickly using the tool below, powered by Bankrate:
Things to consider before signing up for one now
Along with making sure you can keep your money tied up in one place, you'll also want to shop around to ensure you're receiving the best rate of return.
Traditional banks usually cannot compete with online banks. Online banks don't have brick-and-mortar locations, meaning they don't have the overhead expenses, so they can offer more generous returns. While accessing your cash at the end of the term can be trickier, online banks allow you to transfer money to other accounts.
Keep in mind that many banks autorenew CDs. Set a reminder on your phone a week before the maturity date so you can explore other options, reinvest in the same CD, or cash out if rates are much lower.
Why should I sign up for one now?
The Federal Reserve issued its first rate cut of 2025 at its September meeting. When the Fed cuts rates, it lowers the returns savers can earn on all savings accounts, including jumbo CDs.
How much does a cut impact rates? Before the Fed meeting, My eBanc had a one-year jumbo CD with a 4.45% APY. After the cut, the rate is down to 4.15% APY. That 0.30 percentage-point dip may not sound like much, but on a $150,000 deposit, it’s the difference between earning $6,675 and $6,225 over 12 months — a $450 gap.
While many savings products fall when the Fed lowers rates, CDs stand out because their interest rates are fixed. That means locking in a jumbo CD now protects your return when the Fed cuts rates again, which they're projected to do this week at its October meeting.
Therefore, locking in a rate now ensures you're maximizing your savings potential, without any of the risks that the stock market offers. While you might not be able to earn as much as you would with investments, jumbo CDs can deliver substantial returns.
How much can I make with a jumbo CD?
One of our top choices is Finworth. Finworth offers a six-month jumbo CD with a generous APY of 4.10%. Parking your $150,000 there for six months earns you $3,557.44 in earned interest. Not bad for a short investment.
A longer-term option is Prime Alliance Bank. It offers a one-year jumbo CD with a 4.15% APY. Depositing $150,000 into it earns you $6,225 in one year.
On the fence about which terms sound the best for you? My solution is to find what works best for your financial goals.
If you don’t need access to your money for a while, consider locking it into the longest jumbo CD available. Doing so guarantees you earn the highest rates of return to maximize yields.
Meanwhile, if you're unsure about tying up your money that long, opt for a short-term option. I often use short-term CDs as a way to stay on track with savings goals, and they consistently help me achieve them.
Ultimately, while savings APYs took a slight dip from the Fed cutting rates, you can still earn an exceptional return with a jumbo CD. With rates around 4% for both short-term and longer-term options, you'll earn thousands of dollars effortlessly with a $150,000 deposit.
The key is to lock them in now before the Fed cuts rates again this week. If you do, you'll stay ahead of inflation while having access to your cash quickly, which you can reinvest in another CD or consider other options that work best for your financial goals.
Related content
-
I'm want to give my 3 grandkids $5K each for Christmas.You're comfortably retired and want to give your grandkids a big Christmas check, but their parents are worried they might spend it all. We ask the pros for help.
-
If You're Not Doing Roth Conversions, You Need to Read ThisRoth conversions and other Roth strategies can be complex, but don't dismiss these tax planning tools outright. They could really work for you and your heirs.
-
Could Traditional Retirement Expectations Be Killing Us?A retirement psychologist makes the case: A fulfilling retirement begins with a blueprint for living, rather than simply the accumulation of a large nest egg.
-
My Teen Crashed His Car and Now Our Insurance Has Tripled. What Now?Dealing with the costly aftermath of a teen car accident is stressful. Here are your options for navigating it.
-
My First $1 Million: Retired In-House Corporate Lawyer, 74, MidwestEver wonder how someone who's made a million dollars or more did it? Kiplinger's My First $1 Million series uncovers the answers.
-
I'm an Insurance Pro: Going Without Life Insurance Is Like Driving Without a Seat Belt Because You Don't Plan to CrashLife insurance is that boring-but-crucial thing you really need to get now so that your family doesn't have to launch a GoFundMe when you're gone.
-
The Top 22 Gifts for Grandkids from Walmart in 2025From PlayStation to Labubu, you'll find the hottest gifts of 2025 for your grandkids at Walmart this year. Some of them are up to 78% off.
-
CD vs. Money Market: Where to Put Your Year-End Bonus NowFalling interest rates have savers wondering where to park cash. Here's how much $10,000 earns in today's best CDs versus leading money market accounts.
-
Meet the World's Unluckiest — Not to Mention Entitled — Porch PirateThis teen swiped a booby-trapped package that showered him with glitter, and then he hurt his wrist while fleeing. This is why no lawyer will represent him.
-
Smart Business: How Community Engagement Can Help Fuel GrowthAs a financial professional, you can strengthen your brand while making a difference in your community. See how these pros turned community spirit into growth.
-
Smart Money Moves Savers Should Make in 2026These steps will get you on the road to achieving your 2026 savings goals.
