- 1). Decide on how much money you want to save in your CD account. CDs carry early withdrawal penalties for accessing money before the term of the CD is up, so only commit money that you know you will not need for the duration of the deposit.
- 2). Decide how long you are able to commit money into the CD. Since CDs have withdrawal penalties, the duration of the CD is very important. CDs come in many different terms, anywhere from a few months to a few years, and the longer money is committed, the better the interest rate will be. Generally if interest rates are currently low, it is wise not to commit money for too long.
- 3). Use an internet rate comparison site to compare CDs which match your savings amount and desired duration. Bankrate.com is one of the best and most popular sites on the Internet for comparing comprehensive and up-to-date quotes on a variety of financial and banking products. Most sites will list CD rates based upon user provided fields, such as the desired length of the CD, desired deposit amount, and the person's home state and city. On Bankrate.com you can sort your results based on the best interest rate offered.
- 4). Compare several good CDs by looking at their official websites or inquiring by phone. Compilation sites like Bankrate.com are useful for narrowing a search to the strongest options in terms of interest rates, but a final decision should be made by doing some research on the terms and conditions of each individual account. Also, the actual interest rate offered can differ from what is listed on third-party websites.
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