Certificate of deposits are basically similar to a savings account that earns interest. The interest rates are only fixed interest rates. These types of accounts can only be set up through a commercial bank. When a person gets a CD, they will generally have it for only 1 month to 5 years. CD accounts benefits anyone who gets it, because you cannot withdraw any funds from that CD account. If you do, you will have to incur a penalty.
If you want to setup one of these accounts you will have to visit a bank branch. Some banks even let you open these CD accounts up online. For example, if you open up a CD account with Chase, you will have to choose from a 6 month account, and up. These accounts require a $1,000 opening balance. If you have that, you will be on your way to go. Some banks require a opening balance of $5,000, or more to get started with them. The same rules will apply if you visit the branch in person, as far as the opening balance and information needed.
You will need information as far as your social security number, driver’s license or state identification, and checking, savings, or brokerage account and routing number to make your initial deposit. Some of these banks let you pick a term for as long as 10 years, but as stated before, it depends what bank you open it through.
Depending on the length of the CD term that you choose, that will determine the interest rate. The higher the term, the higher the interest rate will be. It doesn’t matter which term you choose, the opening amount will still be the same. All you would have to do after you have all the required information, is fill out the application, whether online or in person. These applications will not take much of your time. The entire process is simple, and before you know it, your CD account will be open in no time. They are good accounts to have, if you are looking to save some money with interest. You will just need to make sure that you have that opening balance already so that you won’t have to worry about anything else. Let the interest start building.