March 26, 2023

If you’re looking for a way to protect and grow your money then a certificate of deposit (CD) may be for you.

Getty Images/iStockphoto

With inflation still persistent and the possibility of relief murky, many Americans are looking for ways to save as much money as possible. Some people could explore new passive income streams while homeowners may lean on their investment via a refinance or a home equity line of credit (HELOC). Others may be looking to protect and grow the money they have saved by opening a high-yield savings account or certificate of deposit (CD) account.

CDs are a particularly appealing alternative for account holders looking to protect their existing savings while also growing it at a higher rate than they would have received if they left in a regular savings account. There are multiple benefits to opening a CD, particularly in the current economic climate.

You can easily check today’s CD interest rates here to determine if it makes sense for you or use the table below to explore some local options.

Why you should open a CD now

Here are three reasons why you should open a CD now.

You can earn more interest

Every dollar counts and with a CD you can earn many more dollars than you would have if you left your money in a regular savings account. Interest rates on savings accounts currently hover around 0.33% but rates for CDs are 4% to 5% or even higher depending on the lender you use, so be sure to shop around to secure the highest rate possible.

To emphasize how much more you can make with a CD versus a savings account consider what would happen with a $5,000 deposit. A CD with a 4.5% interest rate would grow that $5,000 to $5,225 over 12 months while a savings account (at 0.33%) would boost that same deposit by just $16.50. 

So begin exploring your CD options here and start earning more interest right away or simply use the table below to see your local options.

You can rely on the rate

Unlike some other account types in which interest rates fluctuate based on the economy and activity from the Federal Reserve, rates for CDs will remain steady and untouched. The rate you signed up with will be the rate your CD expires with – injecting some much-need predictability into your personal finances. So even if rates on other products fall during the term of your CD you can rest assured knowing that your money will continue to earn interest at the initial rate. 

You can protect your money

If you’re having trouble saving or have become accustomed to a stream of deposits and withdrawals with little change to the bottom line then a certificate of deposit account can help. By leaving your money in a CD (you won’t be able to withdraw it during your term) you can protect your money against the withdrawals it was previously subject to. Combined with the higher interest rate you can both save – and earn more money – simply by transferring your funds from one account into a CD. During a time when grocery shopping prices are painful and interest rates are continuing to rise, it’s beneficial to have a way to protect your money.

You can easily open a CD here now!

The bottom line

In the current economic climate many Americans are looking for any edge they can get. Certificate of deposit accounts can help in multiple ways. They offer more interest than other traditional accounts and that interest rate will remain untouched – despite any market fluctuations – for the full CD term. These accounts can also safeguard funds you may have otherwise spent if accessible in a regular savings account. For all of these reasons and more now is a great time to open a CD.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *