Financially savvy parents know that it pays to start building a savings fund for their children early. Though plenty of saving options are available for today's parents, the certificate of deposit (CD) is arguably one of the best. Saving with a CD can be an excellent choice and can help you save more over time because it's a secure, stable and flexible way to build a nest egg.
Parents want the best for their children, so that means ensuring that future needs are met. When you open a CD account, you generally accrue interest at a higher rate than a traditional savings account, and it's also low-risk. Your deposits are insured by the Federal Deposit Insurance Corporation (FDIC) up to the maximum amount allowed by law.
With a CD, you can secure a specific rate and know exactly what you can expect to have earned when the CD matures. Ally Bank offers some of the most competitive CD rates available according to Bankrate.com, and with interest compounded daily, your balance grows faster.
CDs are offered for a set time period, called a term, which generally ranges anywhere from a few months to a few years. Generally, the longer the term, the higher the rate. So you can start a CD for your child's future needs, watch it grow to maturity as your child grows and renew or re-deposit the money into new CDs until you're ready to turn the balance over to your child.
It's easy to get started saving for your child's future. Learn more by visiting Allybank.com or call live, 24/7 customer care at 877-247-ALLY (2559) today.
Ally Bank, Member FDIC