Finding High Yield CDs In Today’s Market
Understanding CD rates are critical to anyone’s investment opportunities because if the rate isn’t high enough, then it’s not a very good use of tying up one’s money. The CDs are going to range significantly in rates between the length of the CD, how much money is going into the CD as well as the bank or credit union that one uses in order to get the CD.
The best CD rates offered in today’s economy are not as high as they once were, however they are still often higher than savings accounts, as long as one decides to take the time and shop for particular rates. One automatically assumes that a high yield savings account is going to be the best alternative, but it is not necessarily the case.
CDs are Your Best Option
Many times, it all comes down to the amount of money that is in question for investment purposes. There are rules involved for both savings accounts and CDs. Savings accounts require a certain minimum to open the account and then after that, the balance can increase or decrease and it has no bearing on the account. A CD must be a particular amount as well, though that money goes untouched for the duration of the CD length.
Most banks are likely to pay more for the CD because the money is going untouched. That’s when the highest yields become available. The longer that a person is willing not to touch the money, the better the CD rates will be as the bank is rewarding that person as well as helping the finances of the bank by having money in their institution that they can use towards loans and other such things.
Compare Banks to Get the Best Rate
One must consider CD rates from multiple banks and institutions if they plan on getting the highest CD rates. While it is easy to assume that the rates are going to be the same, statistics show that they can range quite significantly. The higher the amount of the CD, the more that even a small percentage change can be quite dramatic on the total rate of return.
The bank that one banks with is not always the best option. There is no bearing of rates whether someone is a customer at the bank or not. It is the same for everyone – customer or not. Therefore, purchasing a CD from the bank that one has an account with is simply more convenient because of the ease of transferring the money.
Continuously Analyze Rates for Worthwhile Investments
CD rates must be continuously analyzed. The average person chooses a fixed rate CD, which is also the most common CD offered. Therefore, when the CD is purchased, the person is locked into that rate for the length of the CD. Following the trends will ensure that the CD purchases when the rates are the highest and ready to dip low again instead of on a steadily increasing curve. Variable rate CDs are sometimes available, however they can be very risky.
When one is looking to invest in CDs, they need to utilize financial statistics that compare multiple banks’ rates on one page for ease of investing.