MoneyWatch: Managing Your Money
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February 26, 2026 / 2:55 PM EST
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CD interest earnings over a five-year period will add up significantly, especially for an initial $20,000 deposit.
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If you’ve been able to accumulate $20,000 in savings, there’s plentiful ways in which you can now leverage it. You can invest in stocks, bonds or even real estate to generate rental income. You may want to consider protecting your portfolio by making a strategic investment in alternative assets like gold and silver. Or you may simply want to lock it away for an extended period, both protecting your principal and growing your interest over a multi-year period.
While there are fewer options to accomplish the latter goal, a 5-year certificate of deposit (CD) account is one of the better ones. CD interest rates remain high now, even if they’re not quite as elevated as they were in the elevated interest rate climate of 2023 and 2024. And, not only will the principal be protected and the interest potentially significant, but CDs are also FDIC-insured, offering peace of mind to savers who are foregoing access to their money for multiple years.
That all noted, the interest-earning potential here is arguably what matters most, as it could be the difference between opening an account and looking for an alternative. So, how much interest can a $20,000 CD account earn over the next five years if opened now, in the first quarter of 2026? That’s what we’ll examine below.
See how much interest you could be earning with a CD account here.
How much interest can a $20,000 CD account earn in 5 years?
Determining the interest-earning potential of a CD account is simple to complete thanks to the account’s fixed interest rate. Currently, 5-year CD rates are still competitive, too, meaning that this could prove to be a profitable home for a $20,000 deposit.
Here’s how much interest you could make, calculated against three available rates and the assumption that no fees or penalties are levied against the account over the five years:
$20,000 5-year CD at 4.00%: $4,333.06 upon maturity
$20,000 5-year CD at 3.90%: $4,216.30 upon maturity
$20,000 5-year CD at 3.80%: $4,099.88 upon maturity
So the interest-earning potential here is significant, and it’s reliable in a way that it won’t be with variable-rate alternatives such as high-yield savings and money market accounts. At the same time, savers will need to be confident in their ability to keep the funds in the account frozen for the full five years, as an early withdrawal fee on an account of this size and length could be costly. If they’ve done the math, however, and can maintain the account without issue, this could still prove to be a lucrative and secure home for their funds.
Get started with a CD account online now.
How has the interest-earning potential of a $20,000 5-year CD account changed?
While the above interest-earnings are still significant, savers who want to pursue this account type shouldn’t wait too long to act, especially considering the growing likelihood of additional interest rate cuts later in 2026. To illustrate how much less profitable this account has become, it helps to know the interest-earning potential a $20,000 5-year CD account was offering just two years ago, when rates were much higher.
Here’s what the same-size account and term would have earned if opened in January 2024 instead:
$20,000 5-year CD at 4.60%: $5,043.12 upon maturity
$20,000 5-year CD at 4.50%: $4,923.64 upon maturity
$20,000 5-year CD at 4.45%: $4,865.07 upon maturity
In other words, don’t wait much longer to act, as you’ve already lost hundreds of dollars worth of interest by opening this account in early 2026 versus early 2025.
The bottom line
A $20,000 5-year CD can still earn savers comfortably over $4,000 in interest, approximately, if opened now and not touched until the maturity date. And while that’s not quite as profitable as what was available two years ago, it still represents sizable interest earnings for virtually no risk. Consider shopping around, then, to see how high a rate you can find and look at online banks, specifically, which often offer more competitive rates and better terms for savers.
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