CD Interest Rates Guarantee the Principal

Calculating CD Interest Rates

September 2012

Generally speaking, interest rates for certificates of deposit (CD interest rates) are higher than interest rates for regular savings accounts and lower risk than stocks.

That difference may cause some people to balk at a CD rate of, say, one percent. So, Ally Bank asked Rick Kahler, president of the Kahler Financial Group in Rapid City, South Dakota to weigh in. Said Kahler, "I sometimes get pushback from clients saying, 'CDs are only paying one percent. Isn't there something that can do better?' The answer is, yes, there are things that can do better. But let's go back to the whole reason that we're using a CD. We want our principal guaranteed. We don't want fluctuations. So it's not about [a] return, it's about the safety."

First and foremost, CDs are a great way to guarantee the safety of your principal and also have periodic access to your money. In addition, they are FDIC-insured up to the maximum allowed by law.

Rates for Certificates of Deposit (CDs) can vary widely among banks, but Ally Bank is able to offer some of the most competitive rates available. Take a look and see which one works best for you. Visit Allybank.com or call live, 24/7 customer care at 877-247-ALLY (2559) today.

Ally Bank, Member FDIC

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