![]() The two biggest factors that impact how much you can earn are how much money you want to put into a CD and the amount of time you’re willing to let the bank hold on to that money. ![]() “They offer the safety of principal…at a considerably higher rate of return than they did 12 months ago,” he says. Like savings accounts, CDs offer the security of insurance from Federal Deposit Insurance Corp., says Clark Kendall, chief executive of wealth-management firm Kendall Capital. The other big difference is that the best CD rates can be higher-sometimes by a lot-than savings account rates. One important distinction is that, with CDs, you have to agree not to touch that money for a designated time, anywhere from a few months to five years or more, depending on which product you pick. “These higher rates are something new and exciting, because for the last several years, we’ve had this very anemic interest rate environment,” says Judi Leahy, a senior wealth advisor at Citi Personal Wealth Management.Ĭertificates of deposit, or CDs, are similar to savings accounts in that you can park your money in one, risk-free, and earn interest on that deposit. That’s prompted some investors to give a long-overlooked investment a fresh glance: certificates of deposit. ![]() After years of hovering near record lows, interest rates have climbed sharply in the past 18 months.
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