Question:

Which Bank is the safest and paying the highest interest on a CD?

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How long do I need to keep the money in the CD. What else is available? Will I have to pay taxes on these investments?

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  1. This only pertains to banks in the US.  First, make sure your bank is backed by the FDIC.  Most "normal" banks are covered, but there are now a lot of online banks.  Check the website below to check if yours is covered.  An individual is covered up to 100k per bank and a joint account is covered up to 200k.  I assumed that you meant "safe" as in them going out of business, so that is where the insurance kicks in.  

    If you have more than 100k in investment capital, then you need better help than Yahoo answers.  And honestly a CD is probably not your wisest move.  Seek a qualified professional for moves over 25k and increments thereof.

    Most banks just get bought and there really hasn't been much trouble since the old saving and loan days.  Banks just merge and get bought out.  Nothing really happens to your money in these circumstances.

    CDs are sold in something called terms or length that you need to keep them to get the full yield.  Usually the longer the term and the more money you keep in your CD, the greater the rate.  You can get your money at any time, but usually they will charge you a penalty.  

    Depending on how much you have there are money market accounts and investors deposit accounts that keep your money liquid, but do not have any time limits, just dollar amounts.  These of course pay less as well, but are better than plain savings accounts.

    There is one product that I sold that was cool that works kind of like a Christmas savings or add on CD.  It was a CD that you started with a certain dollar amount and every month, a draft from your checking or savings account added to the balance.  Kind of a forced savings account.

    You will have to pay taxes on the interest earned on any investment.  Your bank will send you a statement at the end of the year that you must report.


  2. Credit Unions -

    Parkway Bank has many special rates

    Carter Bank and Trust

  3. All banks are FDIC insured up to $100k so I wouldn't worry about that. CD rates are HORRIBLE all over right now. Good luck finding 3%. The length of time varies...they have 3 month CDs and up to 5 year CDs. The shorter term ones pay less interest with the longer term paying the most. Since interest rates are on the rise you do not want to tie your money up in a CD for a long time. Odds favor higher rates 6 months from now so if you were to get a 1 year CD you'd be locked in at the low rate of today. The only time you want a long term CD is when interest rates are high...that maximizes your return and guarantees the high rate. As for taxes...of course Uncle Sam wants his cut. You have to declare all money gained after maturity of the CD. A statement gets automatically sent to the IRS and they do catch that kind of stuff eventually if you don't reported it.

    I would invest in gold and gold mining stocks instead.

    Check out 2 Exchange Traded Funds (ETFs)...GLD and GDX.

    They trade just like a stock. GLD tracks the price of gold...GDX is a basket of top gold miners...just like a mutual fund but it trades like a stock. Gold/Silver are going to be the next big thing. This year it's oil but looking forward 1-3 years from now it will be gold. Gotta get in early;-)

    Good luck.

  4. I use Bank of America - very stable, well funded and nation-wide.

    Yes - interest on CD's is taxable in almost all cases.

    The length of time depends on the CD.

  5. the best bank is bank of america or Chase they both have great services=]

  6. i would try a credit union all banks are different with the availabilities and everything, but i would definetly say a credit union!

  7. Easiest way to stay on top of cd rates and terms is at

    www.bankrate.com

    You will pay taxes on any interest you accumulate. CD lengths range from 3 months to 2 years. remember once you put the money in you can't touch it for several months. You might want to checkinto interest rates for high interest savings accounts like ING Direct or Emigrant Direct. That way you get decent interest and you have 100% access to your money whenever you need it. ( You still pay taxes on the interest)

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