Saving money with certificates of deposits (CDs) is a great idea, especially if you have cash just sitting in your checking account or elsewhere, earning little to no interest. These approaches may help you sock money away, but you miss out on the fact that CDs earn interest at a higher rate while keeping your cash in a safe place at the same time.
When you open a CD, you agree that you will not withdraw the funds until the maturity date, which varies from a few months to several years after you open the account, depending on the term you choose. You can close a CD before the term ends, but you typically will pay an early withdrawal penalty for doing so.
Saving money in a CD allows you to deposit it securely with a bank for a set period of time while it accrues interest and grows. Online banks usually pay a higher interest rate on certificates of deposit than brick-and-mortar banks because they have lower operating costs and can pass the savings on to customers in the form of higher interest rates. What's more, Ally Bank CDs are insured by the Federal Deposit Insurance Corporation (FDIC) up to the maximum amount allowed by law.
Ally Bank offers three kinds of CDs—High Yield, No Penalty, and Raise Your Rate CDs—all of which offer competitive rates and come in a range of terms to suit just about any savings plan. And all our CDs are backed by our Ten Day Best Rate Guarantee for CDs, which gives you the best rate we offer for your CD term during the ten days starting with your CD open date, provided you fund your CD within that time.
Learn more by visiting Allybank.com or call live, 24/7 customer care at 877-247-ALLY (2559) today.
Ally Bank, Member FDIC