It's tough to earn decent money on savings now that the Federal Reserve has pushed rates down, down, down.

The government-controlled bank has dropped what it charges commercial banks to borrow money to rock-bottom levels.

Rates on overnight loans now range from 0% to 0.25%, and the Fed left them unchanged after its June meeting. Rates are likely to stay where they are until the economy shows signs of recovery.

As long as the Fed is a dirt-cheap source of money, banks can continue to reduce what they pay on your deposits, whether they're in certificates of deposit, savings or money market accounts.

Just a couple of years ago, dozens of banks were offering 4% returns on one- and two-year CDs. Now, no one is paying even close to that unless you commit your money for six or seven years. That's too long.

You can't even get a 4% rate on a five-year CD anymore. And the best rate available on one- and two-year CDs ranges from 2% to maybe 2.5%. Our most recent survey of major banks shows the national average on 12-month CDs is 1.14%.

That's the lowest average since April 2004 and well off the peak of 3.86% reached in October 2006.

What's a saver to do?

Take advantage of Interest.com's extensive database of CD rates and follow our 5 smart moves for buying CDs to maximize your returns.

Smart move 1. Don't go too long.

The best rates are on certificates with long terms -- six years or more. But we can't recommend those now. The highest rate you can get on most five-year CDs is less than 4%, and rates should be climbing before those CDs mature.

Unfortunately, rates on 12-month CDs remain low.

You can still get a good rate from Ally Bank, formerly known as GMAC Bank, which is paying 2.25% on a 12-month CD. While it's a lot lower than the 2.80% it paid just a few weeks ago, it remains at the top of the tier. No minimum deposit is required.

And Wilshire State Bank, headquartered in Los Angeles, with 11 branches in Southern California, New Jersey, New York and Texas, has a 12-month CD with a 2.15% APY. It requires a minimum deposit of $1,000.

Discover Bank, the online bank owned by Discover Card, offers a 12-month CD with a 2.10% APY, but it requires a $2,500 minimum deposit.

Don't tie up a lot of money in a four- or five-year CD just to get a better rate. You want to be ready to pounce when shorter-term rates begin to rise.

When will that happen? No one really knows, but the Federal Reserve could start boosting short-term interest rates late this year or in early 2010. Such moves would send CD rates in a positive direction, although a swift and immediate recovery is not in the cards.

To remain flexible with your money, we suggest getting the best yield you can on a term of no longer than 24 to 36 months -- tops. That will allow you to jump on a better rate when your CD matures.

Right now the best-paying 24-month CD is from Broadway Federal Bank, with five branches in the Los Angeles area. It offers an unbeatable 3.05% APY with a $1,000 minimum deposit to online applicants nationwide.

(Those rates are the APYs, or annual percentage yields, each bank pays. APYs are slightly higher than the actual interest rates because they include the interest you'll earn on the interest you're paid during the term of the CD.)

Shy away from deals that require you to open a checking account to get the special rate. You probably don't need a second checking account, and it's just a way for the bank to recoup some of the interest it's paying through fees.

Smart move 2. Look for odd-term CDs.

The best short-term rates are sometimes available on CDs that mature in four, five, seven, nine or 13 months. Banks offer odd terms so they don't have to pay those high rates to repeat customers when they renew traditional three-, six- and 12-month CDs. But you really have to look for these deals.

The bank where you have your checking and savings accounts may have promotional CD specials available only to its customers to keep them from shopping for better rates at other banks. If it's a good rate on a short or odd term, take advantage of it.

Atlantic Southern Bank has 13 branches in Georgia and Jacksonville, Fla., and owns three branches of Sapelo Southern Bank. It's offering a 13-month, 2.80% APY CD (and 2.55% APY on a 7-month CD) with a $500 minimum deposit.

Smart move 3. Don't hesitate to use Internet banks.

They often have the highest rates.

Chances are, the best-paying CD is not at a bank in your neighborhood, so you'll have to apply online anyway. But banks have simplified the process.

Transactions usually are done electronically using your computer, but often you can conduct your business by phone or through the good old U.S. mail. The Internet allows virtually any bank to do business online, and that expands the pool of investors it can attract, usually by offering higher rates.

Signing up is easier than you think, and the federal government insures those deposits, just as it does deposits in your community banks.

Don't sign up for any CD that isn't FDIC-insured, no matter how good the rate. The risk is just too great.

Until at least Dec. 31, 2013, accounts insured by the FDIC are covered up to $250,000 per depositor per insured bank. Depending on the account ownership, don't keep more than the limit in any one bank.

Ask the bank for more details or go to the FDIC Web site to read more about the limits and any exceptions that might apply.

Our guide to getting started with online banks will answer your questions and show you how to open an account.

Smart move 4. Take full advantage of local credit unions.

They often offer competitive rates for many types of loans and deposits -- and sometimes have the best rates around.

The Fire & Police FCU in Philadelphia is paying 2.75% on a 24-month CD with a $500 minimum.

Credit union membership used to be limited to employees of a certain company or trade, but today's rules are more liberal. For instance, PenFed is open to military personnel and those working in military-related positions. Qualifications are extremely broad in scope.

Credit unions are the one exception to the FDIC rule. The National Credit Union Administration (NCUA) insures credit union deposits under the auspices of the federal government, to the same limit as the FDIC.

Here's how to find credit unions in your area.

Smart move 5. Don't ignore the deals right in your own backyard.

Small banks often have better-paying specials because they don't have access to the international capital markets that big banks often use.

For example, Atlas Savings & Loan, a longtime banking fixture in Brooklyn, N.Y., is offering a 30-month CD that pays 2.84% with a $2,500 minimum deposit.

Check the business section of your newspaper and look at signs in front of banks or in their windows when you're driving by. Good-paying CDs aren't plentiful, but they are available.

Go for the best rate on a CD of three years or less. It will give you the flexibility you want to go after the best rate when your CD matures.

Be ready to grab it.

By Carolyn Siegel

Interest.com Associate Editor