Find a Bank Certificate of Deposit (CD) That's Best for You

Learn to Accurately Compare Bank CDs

September 2012

When shopping for a bank CD, one of the most important things to examine is the annual percentage yield (APY). Ally and other online banks tend to operate with lower overhead costs and are usually able to offer better rates.

It's also important to look at how often interest is compounded: Banks might compound CD interest on a daily, monthly, quarterly or even annual basis—the more frequently they do so, the greater your return. At Ally, your interest compounds on a daily basis, meaning you're getting the best possible rate of return.

To get a sense of how this will work for you, look at the "annual percentage yield" (APY), which takes into account the compounding of interest.

Lastly, always consider making sure your deposits are covered by the Federal Deposit Insurance Corporation (FDIC). This is the surest way to make sure your money is safe while it collects interest. At Ally, all deposits are insured up to the maximum allowed by law.

Figure out which CD works best for you

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