What is a CD?
Put simply, a CD guarantees the interest rate on the money you deposit, assuming you do not withdraw the funds before the end of the term. These rates are almost always higher than regular savings accounts and are fixed for the duration, meaning they will not change. The interest compounds over the life of the CD, growing your initial deposit.
Typically, the longer the CD term is, the higher the interest rate is. Financial institutions can be flexible with their rates, often depending on bank size, business, and deposit amounts. Be sure to shop for a CD to find the best rate and get the most out of your money!
|