Certificate of Deposit (CD)
A Certificate of Deposit (CD) is a type of savings account that offers a fixed rate of return over a predetermined period of time. CDs are offered by banks and other financial institutions and are typically FDIC-insured. CDs are a great way to save money and earn a higher rate of return than a traditional savings account.
History of the Certificate of Deposit
The Certificate of Deposit was first introduced in the United States in the early 1960s. It was created as a way for banks to attract more deposits and to offer customers a higher rate of return than a traditional savings account. Since then, CDs have become a popular way for individuals to save money and earn a higher rate of return.
Comparison of CDs and Savings Accounts
| CDs | Savings Accounts |
|---|---|
| Fixed rate of return | Variable rate of return |
| FDIC-insured | FDIC-insured |
| Higher rate of return | Lower rate of return |
| Penalty for early withdrawal | No penalty for early withdrawal |
Summary
A Certificate of Deposit (CD) is a type of savings account that offers a fixed rate of return over a predetermined period of time. CDs are offered by banks and other financial institutions and are typically FDIC-insured. CDs are a great way to save money and earn a higher rate of return than a traditional savings account. For more information about CDs, you can visit the FDIC website or your local bank.
See Also
- Savings Account
- Money Market Account
- Fixed Deposit
- Interest Rate
- FDIC Insurance
- Bond
- Mutual Fund
- Stock
- Annuity
- Retirement Account
