CD Alternatives

For years, Certificates of Deposit, or CDs, have been the “go-to” place to keep your money with no risks. However, a lot of people aren’t happy with today’s low interest rates on CDs. Host Rob West and Steve Moore discuss the issues with CDs and the best alternatives to use.

With a CD, your money is deposited in a bank or credit union for a set amount of time, anywhere from 6 months to 5 years.

The longer the term, the higher the interest rate. Right now, the best you’ll do on a 5-year CD is about 1.5%. That’s a long time to keep your money tied up for such a low rate.

You need to have your 3 to 6 month emergency fund in place first. Rob recommends having it with a higher yield account at an online bank such as Ally, Marcus, or Capital One 360.

You have the potential to earn more at an online bank because you’re not locked into a fixed rate like with a CD.

CD Alternatives

Show Notes

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