Certificate of deposit (CD) investments are a popular choice for individuals looking to grow their savings while keeping their funds secure. CDs are a type of savings account with a fixed term and fixed interest rate, making them a low-risk investment option. When you invest in a CD, you agree to keep your money in the account for a specified period of time, ranging from a few months to several years. In return, you receive a guaranteed return on your investment in the form of interest payments.
CD earnings can be impressive, depending on the interest rate and term of the CD. The longer the term of the CD and the higher the interest rate, the more you stand to earn on your investment. This makes CDs an attractive option for savers who are looking for a predictable return on their money.
One of the key benefits of CD investments is that they offer higher interest rates than traditional savings accounts. This can help your savings grow faster over time, especially if you choose a CD with a competitive interest rate. Don't sleep on these great CD rates—many CDs yield more than 5% APY. See which CDs made the cut.
If you're looking to maximize your savings with CDs, consider using a CD ladder strategy. A CD ladder involves opening multiple CDs with staggered maturity dates. This allows you to take advantage of higher rates without tying up all of your funds in a single long-term CD. By laddering your CDs, you can create a steady stream of income as each CD matures and can be reinvested at a potentially higher rate.
CD rates today are higher than they've been in years, making this an ideal time to consider investing in CDs. By comparing CD rates nationwide, you can find the best CD interest rates and grow your savings to reach your financial goals faster. Looking for the best 1-year CD rates? We've analyzed a host of banks to bring you the best CDs for February 2024.
CD laddering is considered one of the best strategies for today's market, as it allows you to take advantage of rising interest rates without locking all of your money into a single long-term CD. With interest rates steadily climbing, now may be the perfect time to lock in a competitive CD rate and watch your savings grow.
Please note that the investing information provided in this article is for educational purposes only. NerdWallet does not offer advisory or brokerage services, so be sure to do your own research and consult with a financial advisor before making any investment decisions. Interest rates have been steadily climbing for a while now, so it may be time to take advantage of the higher CD rates available and start growing your savings today.
