Certificate Of Deposit (Cd)
| A certificate of deposit, or CD, is a savings account in which the depositor agrees to leave a set amount of money on deposit for a specific period of time. In exchange for this, the bank agrees to pay the depositor a higher interest rate than it would pay on a regular savings account. CDs are a type of time deposit. The money in a CD is FDIC insured, just like a regular savings account. CDs have a fixed term, which can be anywhere from a few months to several years. The longer the term, the higher the interest rate. When the CD matures, the depositor can withdraw the money, plus any interest that has accrued, or roll the money over into a new CD. CDs are a safe and easy way to invest your money and earn a higher interest rate than you would on a regular savings account. |
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