Interest rates have finally started to go back up for savings accounts and it's also happening
for cd accounts as well so i did quite a bit of research and i found the top cd accounts out there
that you can park your money in and that's exactly what we're going to be going over in this video
now i am going to start by talking about some of the pros and cons with having a cd account
so if you already know everything about them and you know about early withdrawal penalties
and everything like that then go ahead and just skip forward in this video because i will leave
chapters that way you can just get right to the bank accounts that you're looking for but we are
going to talk about cd accounts first here okay so if you're wondering what a cd account is it's
called a certificate of deposit and most banks offer these types of accounts and basically it's
just an easy way that you can lock up a certain amount of money for a certain amount of time at a
fixed interest rate that's generally a lot higher than what you can get in just your savings account
because you're keeping it locked up so for instance you could set up a cd account for
two years with ten thousand dollars and let's say you get a two percent interest rate well
that two percent is going to accumulate for that entire two years so at the end of the term you're
going to get that ten thousand dollars back plus the interest that you made for the two percent
and it's all risk-free because it's fdic insured through your bank you're never going to beat the
average return of the stock market with a simple cd account but they are nice to have if you're
saving up for something big like maybe a house or a car and you don't want to risk that money in the
stock market because you're planning on using it within the next few years and that's where a cd
account can come in very handy now you also need to understand that when you set up a cd account
you can't add money to the account and you can't withdraw money from the account without a penalty
so you really want to set aside only a certain amount of money that you're not going to need
and for a certain amount of time that doesn't feel like it's too far into the future and if
you do end up needing to withdraw money from the cd account you can't take out partial withdrawals
you have to take out the entire amount so if you put in ten thousand dollars into the cd account
and you only needed a thousand bucks you can't do that you've got to take out the entire 10 000 or
leave it in for the entire period now if you do have to withdraw your money early you are gonna
have to pay a penalty fee but it's not the end of the world because most banks will charge you
about 90 days worth of interest for closing out the account within a year and then anything from
about a year all the way up to five years is 180 days worth of interest now obviously you are gonna
have to check your own terms for the specific bank that you've signed up for a cd account with
because they are going to have different rules but generally that's about what you're looking at
if you have to make an early withdrawal and if interest rates are on the rise like they
are right now then i probably wouldn't lock my money up for five years anyway
i would just do a two-year term that way in two years interest rates might be a lot better and in
that case you could then reset up a new cd account with a higher interest rate that way you're not
locked in at a lower rate for that long period of time rates also fluctuate quite a bit so whenever
you're ready to sign up for a cd account make sure that you do your own research because even though
the information is accurate right now as of the posting date of this video it is going to change
quite a bit so if you're watching this video in six months or a year from now
do your own research because a lot of those numbers have probably shifted by then
now i'll start talking about the top cd accounts that i found and the first one goes to marcus
by goldman sachs and this one specifically i want to talk about their two-year cd account
because this one is extremely competitive because it's only two years long and it currently pays an
interest rate of two percent and you only need a minimum account balance of five hundred dollars to
get it set up marcus has a lot of cd accounts to choose from starting really low at only six months
and then they go all the way up to six years with their highest interest rate right now paying out
two point five five percent on the six six-year term so overall i feel like they have a very good
variety of cd accounts to choose from and their rates are extremely competitive but specifically
that two-year product that one is really really good all of their accounts only require a 500
minimum balance so it's really easy to get started with any of the accounts
and then on top of that once you set up an account you have 30 days to contribute more money to the
cd account before it's actually locked and that's really cool because a lot of other banks don't
offer that feature so overall i feel like marcus has a really good variety of cd accounts to choose
from that are extremely competitive and then on top of that the minimum balance really isn't that
hard to meet with just 500 bucks now if you easily want to compare different cd rates then definitely
check out bankrate.com i've got an affiliate link for them in the description below so check them
out if you have an interest because you can sift through different banks and different cd rates and
find the one that's going to be best for you okay the next rate that i found goes to synchrony bank
and the reason these guys made my list is because they have a special offer right now and honestly
i'm not sure when it expires but they are offering a 16-month cd rate at 1.85 percent which is really
good considering you're only locking up the money for 16 months rather than 24 months at marcus at 2
so right now that is a very very good offer and on top of that synchrony's minimum balance is
zero so it is very easy to get into any of their cv accounts and honestly with all the
research i've done when you're looking at a 16 month cd account at 1.85 percent that's pretty
much as good as you can get for a short-term cd account their cds start at three months and then
they go all the way up to five years but based on my research their one to two year range is
kind of their sweet spot but obviously rates do fluctuate so you'll want to do your own research
and make your own decision there synchrony also offers a 24-month bump up cd where you'll start
at a lower rate at 1.4 percent but during the term you're allowed to ask for one increase so
if rates happen to go up then that could be a good thing based on if they go up quite a bit or not
so overall i feel like synchrony bank has quite a few cd options that are worth considering
so definitely check them out when you're doing your research next on my list goes
to capital one because they're a very large bank and because a lot of people already bank with them
it makes getting a cd a lot easier because you can just have it in one place with who you're already
banking with for a one year term with capital one you're currently looking at point two five
percent and then you're looking at one point seven percent for a two year and two point two
five percent for a five year so overall they're not the most competitive but because they're a
big bank sometimes it's worth giving up a little bit of interest if you're already banking with
them and they also require a zero minimum balance so obviously it makes it very easy to get into any
of their cd accounts and then one feature that really stood out with capital one is they give
you the option of how your interest is paid out so you can get paid out your interest monthly yearly
or at the end of the term like everyone else so if you do choose to be paid out monthly you will
lose a little bit in compound interest but this is a feature that i've never seen with other cd
accounts so if you do want to get paid monthly you can with capital one now if you're simply looking
for the highest cd rate that's out there the bank that i found with the highest rate goes to
first national bank of america with a five-year cd account that's paying out 2.8 percent in interest
but you do have to have a thousand dollar minimum balance to get started which isn't the end of
the world but that's the highest rate that i found for all of the banks out there right now
so obviously there's a lot of pros and cons when it comes to the different banks out there
that offer cd accounts but really what it comes down to is you just need to do your own research
and find out which one is specifically going to be best for you and your money