Is it benifical to open up a cd account... and are there any good ones that are available for 6 months.... without a deposit of like 1,000. Im trying to find one for less than 1,000 ro put my money into... and adding to it every month....
also... are online cds account good??
any information would be great thanks
2007-02-17 14:09:37 · 5 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
The way rates are right now, you may do just as well with a high-yield savings or money market account as you would with a CD. The rates are similar, and the benefit is that you would have uninterrupted access to your money, whereas with a CD you need to wait for it to mature to access your money without penalty.
Here are my 2 favorite sites for finding the best bank and CD rates:
http://www.bankrate.com/
and
http://bankdeals.blogspot.com/index.html
The first is one of the most well known resources for bank rates, but I find the second one often lists bank and CD rates days earlier than the first.
As for whether online CDs are good, as long as they are FDIC or NCUA insured, you are covered financially. Once you select an online CD or savings account you're interested in, look around the Web for reviews to find out if people have had any trouble with customer service, the online interface, or any other aspect of the account.
2007-02-17 14:44:00 · answer #1 · answered by jtlyr 3 · 0⤊ 0⤋
Many banks have a $2500 minimum for CDs but if you are just looking for a 6 month term then you can also consider depositing your funds in a Money Market Fund. Why give up the liquidity when the rates are about the same? I like ETrade. They have a $1,000 minimum and the rate is 5.05% right now for 6 months.
Pay attention to fees - and be aware that if you invest in a CD and need the money before the end of the term that you could be subject to a penalty for 'early withdrawal' which could erase not only all the interest you earned but also eat into your principal.
Don't let the negatives stop you from investing - putting the money in an online bank makes it more difficult (tho not bad) to get the money out which could help you save but hinder your getting access if you needed the funds. Some online banks offer ATM cards - so shop around.
2007-02-17 22:30:13 · answer #2 · answered by Santal 3 · 0⤊ 0⤋
CD's typically have a much better interest rate than regular bank savings accounts and are insured by the bank as a regular account (at least last time I checked). The drawback is that you cannot get to your money in case of an emergency unless you pay a stiff penalty. Check with several local banks and credit unions to get an idea of what rates they are offering and what the minimum deposits are. If you are a student, you may get a lower or no minimum deposit.
2007-02-17 22:18:57 · answer #3 · answered by Brian G 6 · 0⤊ 0⤋
CD accounts are good for short term money. However, a person should still have other money in longer term investments such as stock mutual funds.
One leading online bank offers 6-month CDs at 5%:
http://home.ingdirect.com/index.html
One has to decide if he or she wants a fixed or variable rate CD. Some banks offer a variable rate CD and would require you to contribute a certain amount into it on a monthly basis.
2007-02-17 22:28:03 · answer #4 · answered by Jack B 2 · 0⤊ 0⤋
go to bankrate.com. They show who is good. Online is fine, as long as they are FDIC insured.
Good Luck!
2007-02-17 22:15:43 · answer #5 · answered by tspbrady 3 · 0⤊ 0⤋