If you’re interested in buying a Certificate of Deposit (CD), then your first concern would be comparing the CD interest rates offered by different financial institutions. Certificates of deposit are very popular investment products at this time, so you will find no shortage of banks willing to offer them. There are quite a few things that draw bank customers to purchase these investments.
Due to the recent uncertainty surrounding economic conditions in the country, many investors are backing away from market based investments, such as mutual funds and stocks. After seeing funds that were performing well over the years tumble down and lose as much as 25% of their value in a few months, individual investors are seeking to play it safe and get financial instruments that are guaranteed not to lose their value, even if they will bring less growth in the end. A CD is also insured in the unlikely event of a bank failure.
One of the first places that you may want to check out to compare the interest rates on a 2 year CD would be the bank where you normally do business. This is because depending on your status as a customer, they may have custom products available that are not usually offered to the general public or advertised on their website. Take a look at what rates they offer and what the terms of a CD are with your current bank.
But when you want to find the top CD interest rates, you shouldn’t limit yourself to your current bank; instead, read more about what you can find on the market today. There are many other financial institutions which offer this investment, so you may have the opportunity to find a better rate somewhere else. This means that you will simply get a better return on your investment after the two year term is up.
A quick search on the internet will let you find websites that collect information from hundreds of different financial institutions in the country. You will then have access to up to date interest rate information for all of the CD products that you can buy.
But the interest rate isn’t the only thing you should be looking at when you’re considering the purchase of a CD. Certain banks require that you invest a minimum amount, which can vary between $500 and $25 000 in a CD. Others have lower or no minimum deposit amounts required.
It is also interesting to be aware of the fact that interest rates offered on a CD can change over time. So if you’ve looked at some rates last month, there is a chance that the rates have gone either up or down since then, so getting your information from sources that are up to date is very important.
Interest rates on savings products such as certificates of deposits and savings account are somewhat tied to the market, so if the economy is doing poorly, chances are that the rates available to investors will go down slightly.
My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.