MoneyWatch: Managing Your Money
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February 20, 2026 / 1:10 PM EST
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The interest savers can earn with both CD and money market accounts remains competitive now, at the start of 2026.
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Whether you have a large, five-figure amount in your savings account or soon expect to, thanks to a larger-than-usual tax refund, it’s critical that you get as much out of that money as possible. And, if you have an amount like $40,000 in a traditional savings account, you simply aren’t. With an average rate of just 0.39%, not only are you not keeping pace with inflation (which sits exponentially higher right now), but you’re virtually losing money by not shifting those funds into a high interest-earning alternative savings vehicle instead.
In today’s cooler interest rate climate, however, savers may simply assume that there aren’t better, much more profitable options to explore. But that would be a mistake worth correcting. Certificate of deposit (CD) and money market accounts, for example, both come with interest rates many times higher than traditional savings accounts. CDs, in particular, also have fixed interest rates that will remain the same even if the wider interest rate climate cools in the months ahead.
Before depositing $40,000 into either account type, however, it helps to know the interest-earning potential each offers now, in the early weeks of 2026. Below, we’ll break down the numbers savers need to first consider.
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$40,000 money market account vs. $40,000 CD: Which will earn more interest in 2026?
Calculating the interest earnings on a CD is simple to complete thanks to the product’s fixed interest rate, but it’s not as easy to do for money market accounts, which have variable interest rates that adjust based on market conditions. But while interest rates are expected to cool as 2026 progresses, they’re also not expected to drop so substantially as to make this unique account type unattractive for savers, either.
Here, then, is how much each account stands to earn this year, calculated using available rates and the assumption that the money market account rate remains constant:
$40,000 3-month CD at 3.90%: $384.42
$40,000 money market account at 4.00% after three months: $394.14
Difference between accounts: The money market account will earn $9.72 more.
$40,000 6-month CD at 4.05%: $801.96
$40,000 money market account at 4.00% after six months: $792.16
Difference between accounts: The CD will earn $9.80 more.
$40,000 9-month CD at 4.00%: $1,194.10
$40,000 money market account at 4.00% after nine months: $1,194.10
Difference between accounts: Both accounts will earn the same amount of interest.
Interest earnings with both accounts, then, will virtually be the same in 2026, assuming rates remain the same. But they’re unlikely to, especially if the Federal Reserve resumes its interest-rate cut campaign this spring and summer. Consider both account options carefully, then, but if you’re singularly focused on earning as much interest as possible with as little market risk, a CD account will likely be your better option here.
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The bottom line
Due to very similar interest rates, the interest-earning potential of a $40,000 CD and a $40,000 money market account at this point in 2026 is virtually identical. But it’s not the same, and the interest will be locked in and guaranteed only with a CD, while it can rise or fall with a money market account. That said, savers will be able to add more to the latter account type in a way that they can’t with the former, so it’s worth evaluating both carefully before getting started. And don’t discount the benefits of splitting your funds between both. As long as you get this money out of the traditional savings account, however, and into one of these alternatives now, you’ll better position your money for additional growth.
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