Personal Accounts Question:
Please tell me what is certificate of deposit?
Answer:
Certificates of deposit allow you to invest your money at a set interest rate for a pre-set period of time. Certificates of deposit often have higher interest rates than traditional savings accounts because the money you deposit is tied up for the life of the certificate which can range from a few months to several years. Be sure you do not need to draw on those funds before you open a certificate deposit, as early withdrawals may have financial penalties.
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