Early withdrawal penalties: Another important consideration may be early withdrawal penalties.The annual-percentage yield (APY) of any savings account may provide a clearer picture of potential returns than a flat interest rate by considering compound frequency. However, considering the compounding frequency may be equally important as this can affect the overall growth of your deposit. CD rates: Interest rates for your CD may be a prime factor in choosing CDs.Be sure to look at the term and the rate as they sometimes correlate you may find higher rates on CDs with longer terms than with shorter terms. CD term length: This is how long your deposit is held in the account.However, you may want to consider some basic variables to help you find your CD: There are many types of CD accounts to pick from, each one with its own features and characteristics.
The first step to saving is picking the right CD for you. But how does opening a CD work? Is it different from a traditional savings account? And what do you need to get started? Let’s answer all those questions and walk through the CD account opening process. A certificate of deposit (CD) may be an effective way to add structure to your savings and possibly boost your returns.
