Find High CD Rates
Finding the best interest rates on your CDs will help you to earn more on your money – without having to take on additional risk. If you are considering if you should invest in CDs, you will need to know how and where to find the best certificate of deposit rates as well as the basics of CD investing. So, before committing to a CD investment, you will want to shop around for the top CD rates by contacting banks and other financial institutions, as well as researching for competitive CD rates online. There are a number of internet sites that post best CD rates on a daily basis.
Get Rates From Banks Where You Have Deposits
A little known fact is that many banks offer their best CD rates to their loyal customers. So, if you are already a depositor at a particular bank, inquire as to how you can get the highest CD rates. Oftentimes the bank will require that you meet some particular minimum deposit requirements. Although if you already have a substantial checking or savings account at your bank, then you may already qualify for your bank’s higher rates on CDs. Similar to savings or checking accounts CDs also have the benefit of FDIC insurance.
Traditional Issuers of CDs
You can get bank cd rates from your local bank, or through bank cd offers nationwide online. These CDs offer FDIC CD insurance protection. Investors have traditionally invested in credit union CD rates through a credit union – though you need to be a member of the credit union to invest in CDs that way.
Brokered CD Issuers
Another option for the best CD rates is to purchase from a brokerage firm. Brokered CDs are offered for sale by brokerage firms. Typically, brokered CDs will offer investors the best CD rates. However, in order to receive these higher rates, you may need to deposit a minimum amount into your CD. This amount could be $10,000 or more.
Longer Maturities and Larger Investments to Increase Yield
Certainly one way to get high interest CD rates – whether you buy from a bank, credit union, or brokerage firm – is to buy CDs with longer term maturities and with larger deposit amounts – Jumbo CDs. In return for tying up your funds for longer periods of time, you will be rewarded with a higher rate of interest. Be sure that you can leave your funds in the investment for the allotted time period because if you withdraw your funds early, you will be charged a penalty by the financial institution.
What to Know Before Investing in CDs
Investors use CD strategies such as CD laddering to maximize the yield on their CD portfolio while ensuring that they have access to liquidity when they need it. Before investing in CDs, be sure to understand the basics of investing in CDs and that CDs are the right investment decision for you.
Regardless of where you purchase your CD, it is important to know that unless you specifically request otherwise, when your certificate of deposit matures, many banks and brokerage firms will automatically renew the CD. And, if interest rates are rising at that time, you may find yourself locked in at the old interest rate and unable to reinvest those funds into something else until the new CD matures – or risk facing a CD penalty.