This underused savings tool could earn you guaranteed 5.5% interest—but you'll want to act quickly
Publishing timestamp: 2024-01-16 13:35:46
Summary
With the Federal Reserve expected to cut interest rates in 2024, now may be a good time to invest in a certificate of deposit (CD) while rates are still high. CDs offer higher interest rates than most savings accounts, but they are not widely used by young people. The yield for 12-month CDs has increased significantly, and currently, you can find CDs that pay close to 5.5% interest. CDs are a low-risk option for earning interest on cash savings that you plan to use within a few months or years. However, there are downsides such as penalties for early withdrawals and taxes on interest earned. It is important to align the time period of the CD with when you will need the money.
Sentiment: NEUTRAL
Tickers: US1Y,
Keywords: personal finance,