I'm not sure if I should just open a high-interest savings account or a CD. Obviously, I would have to wait to transfer the money from the CD, but I'm new at this and wonder how this works.
2007-07-08 06:30:38 · 5 answers · asked by Andrea K 2 in Business & Finance ➔ Personal Finance
The CD ties up the money for a specific period of time. When that time expires, yes you can take it out, put it in a savings account, or do anything with it that you want to. If you do nothing, many CD's "roll over" - become a new CD for the whole amount, for the time period that the original one was, at whatever the interest rate is then.
2007-07-08 07:09:53 · answer #1 · answered by Judy 7 · 1⤊ 0⤋
NO. A Certificate of Deposit is for a specified amount of time, maybe a year. You can't touch the money until then. If it is an emergency, you can get it back but you will pay a penalty which sometimes will eat into your principal amount. You may not even get back the amount you put in the CD. Look into a Money Market account if you think you may need the money. After the time is up, you can do whatever you want with the money.
2007-07-08 06:39:54 · answer #2 · answered by Anonymous · 1⤊ 0⤋
If you open, say a 1 year CD, you cannot touch the money until after the one year without paying a penalty.
I would suggest looking into some online savings accounts. They pay as much if not more than CD's. And, you can get to the money generally in 3 days or less by electronic transfer.
Here are a couple of good FDIC insured online savings accounts...
https://www.emigrantdirect.com/EmigrantDirectWeb/index.jsp
http://www.hsbcdirect.com/1/2/1/offer?code=PPGA500000
Both are currently paying 5.05% APY.
2007-07-08 06:42:10 · answer #3 · answered by mister_galager 5 · 1⤊ 1⤋
You can redeem a bank CD anytime. Some banks will allow a partial withdrawal of a CD. There will be a penalty on early withdrawal. But if you have owned the CD for over eighteen months your net gain will probably still be better than the savings account. At least that is true of bank savings accounts in my area.
I usually get long term callable CDs. These give the best rates and I redeem them when needed. For ready cash I think this is the best way to save it.
You can get better CD rates through a broker. But they are harder to redeem. You have to put it up for bids and take what you get. (That may not be true of all brokers.)
2007-07-08 06:43:01 · answer #4 · answered by Mystery 6 · 1⤊ 1⤋
Yes, of course you can transfer it. You just have to wait until the CD matures to do it without any penalty.
2007-07-08 06:41:28 · answer #5 · answered by Califrich 6 · 1⤊ 0⤋