Are you wondering how to get the best certificate of deposit (CD) rate? If you're looking for a long-term strategy to build your savings, a CD could be the right choice for you.
The following article explains many of the factors that determine CD rates and how you can find a CD that fits your savings needs.
Customers researching certificate of deposit rates are likely to find different rates from bank-to-bank. Two factors that determine the rate of a CD are (1) the term of the CD and (2) current trends in interest rates.
"Term" refers to the length of time that it takes for a certificate of deposit to mature. A bank will usually offer a higher rate for a longer term and a lower rate for a shorter period of time. Customers can choose the strategy for their CD term that best fits their savings needs.
Generally speaking, CD rates follow the trend of interest rates in the economy. If interest rates are high, CD rates will also be high. Even if daily fluctuations in rates initially appear minuscule, compounding interest can potentially provide a significantly higher yield when the CD matures.
Compounding interest means that the interest earned on your CD will be added to your principal. The increased principal will then earn additional interest.
Most CDs offer a higher rate compared to rates for savings and money market accounts. CDs are also considered low-risk deposits. Experts often note that CDs offer a solid middle ground option for individuals who want to build their money without assuming substantial risk.
As with other deposit products, many CDs are insured by FDIC up to $250,000, per depositor, per insured bank, for each ownership category.
However, it's important to note that CDs carry penalties if you wish to access your money before maturity. Make sure you know what the CD penalties are before opening an account.
With a minimum deposit of $2,000, Synchrony Bank has rates that go beyond the national average+ on certificates of deposit with terms from 3-60 months. In addition, we also offer customers 24/7 online access, award-winning customer service and other perks such as free identify theft resolution.*
Click here to open an account or call Synchrony Bank today at 1-844-345-5789 to explore our certificate of deposit rates today.
Wall Street Journal: guides.wsj.com/personal-finance/banking/what-is-a-certificate-of-deposit-cd/
Nerd Wallet: nerdwallet.com/blog/banking/cds/cd-early-withdrawal-fees/
+National Average APYs are based on specific product types of top 50 U.S. banks (ranked by total deposits) provided by Informa Research Services, Inc. CD Rates: Average APYs are based on certificate of deposit accounts of $25,000. High Yield Savings Rates: Average APYs are based on High Yield Savings Accounts of $10,000. Money Market Account Rates: Average APYs are based on Money Market Accounts of $10,000. Although the information provided by Informa Research Services, Inc. has been obtained from the various institutions, accuracy cannot be guaranteed.
*Identity theft resolution services are provided by CyberScout™.
*ANNUAL PERCENTAGE YIELD (APY): All APYs are accurate as of .
APYs are subject to change at any time without notice. Offers apply to personal accounts only. Fees may reduce earnings. For Money Market and High Yield Savings Accounts, the rate may change after the account is opened. For CDs, a minimum of $2,000 is required to open a CD and must be deposited in a single transaction. A penalty may be imposed for early withdrawals. After maturity, if you choose to roll over your CD, you will earn the base rate of interest in effect at that time. The APY shown for CDs and IRA CDs is for a 60-month CD with a balance of at least $25,000. Click here for all CD rates and terms offered.