What do I need to know before I purchase a CD?

Question

What do I need to know before I purchase a CD at a Bank?

Answer 1

The interest rate and your alternatives. Why buy a CD if something else will pay you more?

Answer 2

whether you like the music or not. You could give it as a gift, too.

Answer 3

You should know the interest rate you are getting, the length of the term, comparative rates at other banks for the same term, and what penalties there are for early withdrawal.

Answer 4

Don't get a CD.  PLEASE!

Check www. bankrate.com for the rates that banks are offering and you will see that you can have a no fee flexible savings account for better rates than your local bank is offering on a CD.

Rates are extremely low so why would you want to lock your money in at this low rate?

Not sure what they are offering rate wise but I opened an account at www.sbk.com and I got a $25 bonus and my account is earning 3.50%.  Look around more and stay away from the traditional banks.  They suck.

Answer 5

CD - certificate of deposit

I highly recommend you don't invest in any bank investments because of their low rate of return. Why invest in bank equity where you can invest in stocks or corporate bond which will pay you more.

Then think about inflation:

If a CD is worth 4% APY (annual percentage yield) and the inflation rate in this country is 6%, what is its real worth?

4% - 6% = -2%

You are much better off investing someplace else.