Certificates of Deposits (CDs)

The Basics

Certificates of Deposits, which are commonly called CDs, are a type of savings account that allow you to receive a higher interest rate than you would typically receive on money deposited into a traditional savings account. In order to provide a higher interest rate, financial institutions require you to leave your money in your account for a specific period of time, usually for as little as 3-months, or sometimes for as long as 5-years.

The Benefits

  • CDs are FDIC-insured (up to $100,000)
  • CDs have fixed interest rates
  • CDs offer higher interest rates than many other types of savings accounts
  • CDs have predictable rates of return that are easy to calculate

What to Consider

  • CDs have early withdrawal penalties
  • CDs do not allow balance transfers
  • CDs do not allow checks to be written against the account
  • CDs will pay a higher interest rate if you agree to a longer term
  • CDs require a minimum deposit to open an account
     CD Account Rates      Open a Certificate of Deposit(CD)