Changes

A '''certificate of deposit''' (CD) is a monetary option offered by [[bank]]s where a client can put an amount of money into a certicate that is then tied up for the length of the contract at a set rate of return.  The longer the contract term, the greater the [[interest rate]] offered in most cases.  Any attempt to take money out of the certificate of deposit before its expiration date would result in a monetary penalty.

A '''certificate of deposit''' (CD) is a monetary option offered by [[bank]]s where a client can put an amount of money into a certicate that is then tied up for the length of the contract at a set rate of return.  Often a minimum amount is required, often $1,000 (though sometimes as little as $500 can be deposited).

Many certificates of deposit also offer graduated rates based upon the amount of money to be deposited or may have a minimum requirement to open a certificate of deposit.  For those with graduated rates, the rates of return are usually greater for higher deposit amounts.

Generally speaking, the longer the contract term and/or the more deposited, the greater the [[interest rate]] offered.

Ex. A CD may pay 5.00% interest for 9 months for deposit values < $10,000, 5.25% for amounts > $10,000 but < $50,000, or 5.50% for amounts over $50.000 with a minimum starting outlay of $2,000 to open the account.

Any attempt to take money out of the certificate of deposit before its expiration date would result in a monetary penalty.

==See also==

==See also==

[[Category:Banks]]

[[Category:Banks]]

[[Category:Finance]]

[[Category:Finance]]

[[Category:Retirement]]

[[Category:Retirement]]