With the advent of online banking and bank rate comparison sites, banks are competing for your loyalty and business more than ever. You now have many choices when it comes to finding high interest CD rates and reaching your savings goals. Here’s how to use certificates of deposit (CDs) to get the best possible return on your savings investment.
Get the Best Deals by Comparing Rates
Many sites allow you to compare up-to-the-minute CD rates, while also highlighting the safety and stability of the bank itself. Look for a financial institution that has been awarded the Safe and Secure Rating from Bankrate.com, one of the most popular CD rate comparison sites. But don’t choose a CD based on the rates alone; there are some other factors to keep in mind.
Terms and Deposit Amounts Matter
The total amount you can earn from high interest CD rates changes from day to day, but the formula itself comes down to one simple rule: the more you deposit with the bank and the longer it stays there, the more likely you are to benefit from high interest rates. You’ll also want to make sure that the CD you buy is backed by the Federal Deposit Insurance Corporation (FDIC) which guarantees each banking customer’s deposits up to $ 250,000 for each account type. Profitable bank CD rates are available for shorter term savings goals too. You can invest as little as $ 1,000 for a term as short as 6 months and still earn more with a CD than you would putting that same money in a traditional savings account.
The Benefits of Compound Interest and Automatic Rollovers
Compound interest in another way to benefit from high interest CD rates . Each day, compound interest accrues on your CD; every month, that interest is and is added to your account, increasing your return. When your CD reaches its term length (called the maturity date), you can choose to have it re-invested for the same length time. An automatic rollover makes it easy to benefit from compound interest.
The Final Word on High Interest CD Rates
Anyone who would like to make their money work harder for them can benefit from competitive CD rates. With a CD, you’ll never have to worry about the ups and downs of the stock market, or how a drop in the money markets might affect your savings. Your CD remains just as secure as when you originally bought it. Buying a CD is a low-risk, secure way to invest your money and reach your financial goals – whether it’s for a family vacation this summer or a dream house five years from now. With high interest CD rates, you’ll be able to reach your goals quickly and with confidence – and with a guaranteed return on your investment.
Jess Hall writes out of Jersey City about different investment opportunities, including tips on finding high interest CD rates. Always looking for a trusted financial institution for advice and tips she tends to look up information at http://www.aurorabankfsb.com/ more often than not.
Finding the highest CD, or certificate of deposit interest rates requires lots of research into brokerage firms and banks. Ask about different types of CDs and whether rates are going up or down before making an investment with tips from an investment portfolio manager in this free video on investing and personal finance.
Expert: Gregory Bramwell-Smith
Bio: Gregory Bramwell-Smith is the relationship and portfolio manager at Bramwell-Smith Associates.
Filmmaker: David Pakman