Looking for the secret to finding the best Cd Rates in the country? Here you’ll find some tips on how to get an excellent, safe return for your money.
Cd Rates: What they mean
Cds, also known as Certificates of Deposit, are best known for being nearly as safe an investment as putting money in a savings account, but for usually returning a better interest rate. Cd Rates vary depending on both the bank or institution you are investing with, and on the length of the investment. When you buy a Cd, you are allowing your bank to hold the money for a set period of time: three months, six months, 1 year, 5 years, etc. In return, they offer you a guaranteed rate of return.
Secret to finding top returns
You can easily find the top current Cd Rates by checking Bankrate.com. At that Web site you will be able to easily view the current highest Cd rates (also known as yields). The rates change on a daily basis, but at this time the average return on a 6-month CD is 1.31 percent (per year); the return on a 1-year CD is 1.69 percent; and the return on a 5-year CD is 2.97 percent. In general, the longer you allow the financial institution to hold your money, the higher rate, or yield, you will receive in return.
Different banks, different rates
After you look at average CD rates, Bankrate.com enables you to search for the rates being offered by particular financial institutions. These can vary widely. For example, on a recent day one bank was offering a return rate of 3.35 percent for a 5-year CD, while another promised only 1.98 percent per year. This is a very big difference, so keep these research tips in mind while investing.
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