How CDs Work
A Certificate of Deposit (CD) is a savings product that earns a fixed interest rate for a set term. You agree not to withdraw funds until the maturity date, in exchange for a higher interest rate than a regular savings account.
Frequently Asked Questions
What is APY? Annual Percentage Yield includes compound interest. A 4.5% APY with monthly compounding earns more than simple 4.5% interest.
What happens if I withdraw early? Most CDs charge an early withdrawal penalty, typically 3-6 months of interest depending on the term.