Many people have questions about certificates of deposit (CDs). Take a look at the following answers to commonly asked questions and find out if a CD is right for you.

Q: What are CDs?

A: A CD is a time deposit. 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.

Q: How long can I keep my money invested in a CD?

A: US banks and credit unions offer CDs with terms ranging from a few days up to several years. Ultimately your goals will help you decide which term works for you, but bear in mind that you'll generally find longer-term CDs have better rates.

Q: How much do I need to deposit to open a CD?

A: Some banks require a minimum deposit to open a CD. At Ally Bank, you can open and fund a CD with any amount.

Q: What is a CD maturity date?

A: The maturity date is the date that the term of your CD ends. At that point you are free either to place your funds in another CD, renew with the same term or withdraw any amount from the CD.

Q: Are the funds in certificates of deposit insured?

A: Your deposits at FDIC-member banks are insured up to the maximum amount allowed by law by the Federal Deposit Insurance Corporation.

Q: What happens if I withdraw my money before the CD's maturity date?

A: Typically you will pay an early withdrawal penalty if you withdraw funds from your CD before it matures. Ally Bank, however, offers a No Penalty CD, which allows you to withdraw all your money, including interest earned, without any penalty, any time after the first six days following the date you fund your account.

Q: What is CD laddering?

A: A CD ladder is a system that diversifies your money across CDs with varying maturity dates. For example, you might put 20 percent of your funds in five different CDs, each of which would have a different term length. If you chose CDs with term lengths of 12 months, two years, three years, four years and five years, for example, once the 12-month CD matured, you could then renew it in a new five-year CD. Following this process every year would result in a CD maturing every year, allowing you to take advantage of potentially higher long-term rates.

Take a look at the variety of CDs Ally Bank has to offer, all at some of the most competitive rates in the country. Learn more by visiting or call live, 24/7 customer care at 877-247-ALLY (2559) today.

High Yield CD

No Penalty CD

Raise Your Rate CD

View CD Rates