How to Find the Best CD Rates

Certificates of Deposit (CDs) are a safe, secure and straightforward way to invest for both short term and long term goals. A CD works in much the same way as a traditional savings account: you invest a certain amount of money and earn interest on it for a set time period. The difference is, you make more money depending on how much you invest into the CD and how long you keep your funds there. The amount you make depends on your CD rates, but you don't have to go far to find the best rates.

What to Look for When Comparing CD Rates

Because of the fierce competition between local, national and even online banks, you can get great CD rates without a lot of legwork or research. There are plenty of banking comparison sites online which will show you the different rates, but you'll want to search a little deeper to find out what the terms are in order to get the highest CD rates for your needs.

For example, you'll want to look at the interest rates - are they compounded daily and posted monthly? This allows you to earn new interest in your invested funds every single day, and see how much your investment has grown every month. You'll also want to see what the minimum deposit amount is. Some banks require a substantial minimum deposit, but others will let you deposit as little as $1,000 to lock in your CD rates.

Then, you'll also want to consider the term lengths, which can vary from as little as six months, to a full five years, with the option to automatically renew your CD when it hits its maturity date. Look for an easy to understand rate table which shows you both the interest rate and the APY (Annual Percentage Yield) so you can see exactly what you're earning in one year.

Finally, you'll want to make sure the bank you're investing with is FDIC-insured. This means that your funds are backed by the stability and security of the federal government. If you're looking for a low-cost way to invest money without the risks and volatility of the stock market or a money exchange, CDs are a solid way to help you build and plan for the future. Whether you're saving for short or long-term goals, getting the best CD rates can help your investment go farther.

Jess Hall writes out of Jersey City about different investment opportunities, including what to look for to find the best CD rates online. Always looking for a trusted financial institution for advice and tips she tends to look up information at https://www.aurorabankfsb.com more often than not.

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