A certificate of deposit (CD) is a savings account that holds a fixed amount of money for a fixed period of time, usually six months, a year, or five years, and in exchange receives interest from the bank that issued the CD. CD’s are considered to be one of the safest investments and as a result have very low interest rates due to their safety. CD’s bought through a federally insured bank is insured up to $250,000

 

Where you can purchase Certificaate of Deposit's

 

CD's can be purchased through your bank or broker.

 

Generally CD's that have longer terms receive higher interest rates than CD's that are short terms

Smaller institutions might usually offer a higher interest rates than larger institutions.

Some banks offer higher rates for CD's with larger principals