12 Month CD Rates, The Best Rates

By: EconomyWatch Content Team   Date: 25 February 2010

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CD rates can be tricky and that is why it helps to know what to be aware of when it comes to 12-month CD rates. Opening a certificate of deposit account is a popular way to earn some money for the conservative consumer. The interest rates on CDs tend to be higher than on savings account. However if you like to gamble than you are better off looking into the stock market. Certificate of deposits tend to be very tame forms of investments.

You have probably heard it many times before but it never hurts to be told again. You need to shop around for the 12 month CD rates that are most suitable for your budget and lifestyle. Once you have purchased one bear in mind that locking your money into a certificate means leaving your money there for a specified period of time. You cannot take your money out whenever you want to like you can with a savings account. Money placed into a CD account is not liquid. Do not commit your money to a longer period of time then you can cope with. If 12 months is as long as you can afford then buy a 12 month certificate of deposit. If you do withdraw the money early then you will have to pay a penalty.

Besides finding out about 12 month CD rates you also need to find out if insurance is available on a certificate of deposit that you purchase. Some financial institutions offer insurance on such while others do not. You are much better off choosing a company that will insure your CD as opposed to one that will not. If the bank suffers any type of loss or fails all together then you don’t want your money to disappear!

If you have a large amount of money to invest then you will earn a high interest rate. The 12-month CD rates for jumbo CDs are not as high as for two or three year CDs but the interest you earn will still be substantial. The minimum investment for a jumbo CD is $100,000 and most of the time they are insured by the FDIC (Federal Deposit Insurance Corporation). Just like other types of CDs you can choose a short-term or a long-term for your certificate of deposit. The longer a term you choose the more interest you will earn. 

You have probably been told this before but it never hurts to be told again- if you take your money out early then you will incur a penalty. If your CD is a jumbo one then the fee you will pay for early withdrawal will be high. Don’t chance it! 
 


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