{"id":6070,"date":"2023-02-15T05:02:46","date_gmt":"2023-02-15T11:02:46","guid":{"rendered":"https:\/\/dudleymediagroup.com\/maximize-your-savings-with-low-risk-cds-learn-what-to-consider-before-investing\/"},"modified":"2023-02-15T05:02:46","modified_gmt":"2023-02-15T11:02:46","slug":"maximize-your-savings-with-low-risk-cds-learn-what-to-consider-before-investing","status":"publish","type":"post","link":"https:\/\/dudleymediagroup.com\/maximize-your-savings-with-low-risk-cds-learn-what-to-consider-before-investing\/","title":{"rendered":"Maximize Your Savings with Low-Risk CDs: Learn What to Consider Before Investing"},"content":{"rendered":"

Certificates of deposit (CDs) are an increasingly attractive investment option in the current market, offering a guaranteed return of 4% or more \u2014 some even offering yields of up to 4.75%.[0]<\/a><\/sup> Whether you\u2019re looking to capitalize on your savings potential, generate income in retirement, or diversify your investment portfolio, CDs offer a low-risk way to do just that.[0]<\/a><\/sup> However, there are some things to consider before you open up a CD as the terms of the agreement are specific.[1]<\/a><\/sup><\/p>\n

When you open a CD, you\u2019ll determine the length of the fixed \u201cterm\u201d that will be established \u2014 from three months to a number of years \u2014 and the money will be locked for that period of time.[1]<\/a><\/sup> CDs provide a higher interest rate than a regular savings account, thus allowing for a greater return on your investment.[2]<\/a><\/sup> However, you cannot touch the money until the term is complete, or you\u2019ll incur a penalty for an early withdrawal. Liquid CDs, which offer flexibility in accessing the original deposit, are not as advantageous as traditional CDs in terms of interest rates.[1]<\/a><\/sup><\/p>\n

Minimum deposit amounts vary from bank to bank.[3]<\/a><\/sup> Generally, a bank will require you to deposit a minimum of $1,000 when opening a CD.[1]<\/a><\/sup> However, some banks like Ally Bank offer CDs with no minimum deposit.[1]<\/a><\/sup> Additionally, the longer the term, the higher the interest rate.[4]<\/a><\/sup> For example, Ally Bank\u2019s 3-month CDs pay 4.10% APY compared to their 10-year CDs, which pay 4.60% APY.<\/p>\n

Furthermore, if you withdraw your money early, you will be subject to a penalty fee. For CD terms of three months or less, the penalty is 60 days of interest; for CD terms of 3 to 12 months, the penalty is the greater of 50% of the interest that would have been earned on your funds if held to maturity or 1% of the amount withdrawn; and for CD terms of more than one year, the penalty is the greater of 50% of the interest that would have been earned on your funds if held to maturity or 3% of the amount withdrawn.[5]<\/a><\/sup><\/p>\n

0. <\/span>“‘You may want to think about a CD.’ Some CDs pay 4.5% or more right now. Should you get one?” MarketWatch, 10 Feb. 2023, https:\/\/www.marketwatch.com\/picks\/you-may-want-to-think-about-a-cd-some-cds-pay-4-5-or-more-right-now-should-you-get-one-01675975850<\/a><\/p>\n

1. <\/span>“Best CD Accounts of February 2023” GOBankingRates, 7 Feb. 2023, https:\/\/www.gobankingrates.com\/banking\/cd-rates\/best-cd-rates\/<\/a><\/p>\n

2. <\/span>“Best 3-Year CD Rates for February 2023” GOBankingRates, 8 Feb. 2023, https:\/\/www.gobankingrates.com\/banking\/cd-rates\/3-year-cd-rate\/<\/a><\/p>\n

3. <\/span>“BMO Harris CD Rates February 2023 \u2013 Forbes Advisor” Forbes, 14 Feb. 2023, https:\/\/www.forbes.com\/advisor\/banking\/cds\/bmo-harris-cd-rates\/<\/a><\/p>\n

4. <\/span>“The Best 3-Month CD Rates of February 2023” Business Insider, 10 Feb. 2023, https:\/\/www.businessinsider.com\/personal-finance\/best-3-month-cd-rates<\/a><\/p>\n

5. <\/span>“State Farm CD Rates February 2023 \u2013 Forbes Advisor” Forbes, 14 Feb. 2023, https:\/\/www.forbes.com\/advisor\/banking\/cds\/state-farm-cd-rates\/<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Certificates of deposit (CDs) are an increasingly attractive investment option in the current market, offering a guaranteed return of 4% or more \u2014 some even offering yields of up to 4.75%.[0] Whether you\u2019re looking to capitalize on your savings potential, generate income in retirement, or diversify your investment portfolio, CDs offer a low-risk way to […]<\/p>\n","protected":false},"author":6,"featured_media":6069,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[44],"tags":[],"_links":{"self":[{"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/posts\/6070"}],"collection":[{"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/comments?post=6070"}],"version-history":[{"count":0,"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/posts\/6070\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/media\/6069"}],"wp:attachment":[{"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/media?parent=6070"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/categories?post=6070"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dudleymediagroup.com\/wp-json\/wp\/v2\/tags?post=6070"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}