What to do if your CD account matures this July

Savers with CD accounts set to mature this July will want to make some strategic moves now. Getty Images

If you opened a certificate of deposit (CD) account in the past two years and are approaching a July 2025 maturity date, then you likely already know that the interest rate climate has changed significantly since your initial deposit. In 2023 and 2024, for example, some savers were able to lock in CD interest rates over 5% and sometimes as high as 6% or 7%. That was due, in part, to a high federal funds rate designed to combat inflation.

Now, however, inflation is multiple points lower than it was and the federal funds rate has been cut three times in the last year, with more rate cuts expected in the upcoming months. As a result, the top CD rates generally don't go much higher than 4.50%. And the economic landscape that your CD account is set to mature in is markedly different than what it was when you first opened it. That doesn't mean, however, that you still don't have viable options to explore, including with new CD accounts. It just means that you may need to be a bit more strategic in your approach. 

That begins with knowing what to do if your CD account is set to mature this July. Below, we'll detail three steps savers should consider taking this month.

Start by seeing how high your current CD rate offers are here.

What to do if your CD account matures this July

Do you want to continue earning a high rate of return on your money? Then consider taking these three steps if your CD account is set to mature before July 31, 2025:

Don't let it automatically rollover

Many CD accounts come with a grace period, after the maturity date, in which you can withdraw the funds penalty-free or transfer them into a different account type. But if you don't take advantage of that period (typically one to two weeks), your account could automatically roll over into a new CD account with what almost assuredly will be a new, lower rate than your initial one. And, if that happens, you'll get stuck paying an early withdrawal fee to regain access to your money. So, take advantage of the grace period and don't let it automatically roll over. There are still viable CD options available, especially if you look to use online banks and institutions.

Compare your CD account options online now.

Take the time to shop for high rates

High CD rates will not be as readily available as they were six or 12 months ago, so you'll want (and need) to take the time to shop around. Fortunately, this July is a good time to do so. With expectations that the Federal Reserve will keep its federal funds rate frozen at its July meeting, but with predictions surrounding a rate cut growing for when the central bank meets again in September, it's critical that you use this time wisely. 

So, look around online to see what rates and terms are available and compare those to what you can get with your local branch to see what makes the most sense. But don't wait too long to act, either. Banks don't need to wait for formal rate-cutting action to reduce what they offer savers and if the chances of a rate cut continue to grow, CD rates could fall later in July and in August in anticipation.

Consider a long-term CD over a short-term one

Long-term CDs may have slightly lower interest rates than short-term CDs have had in recent years (a reversal from historic trends), but the extended interest-earning timeline still generally favors long-term CD account holders. And with rate cuts appearing imminent, CD rates already lower than they were in 2022 to 2024, and alternatives like high-yield savings accounts coming with variable rates subject to decline based on market conditions, a long-term CD could be the ideal way to maximize today's high rates for multiple years to come. Just be sure to only deposit an amount that you can comfortably afford to leave in the account untouched or you could risk having to pay that penalty to get it back.

The bottom line

Savers are entering a new rate climate this July than the one they first got into when they opened a CD in recent years. But that doesn't mean that they still can't include a CD as part of a diversified and valuable savings strategy. By taking the above steps this month, savers with a CD account set to mature in July can position themselves for additional, substantial earnings in the months and, potentially, years to come, even if rate cuts are issued during their next CD's term.