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| Name | What is a Certificate of Deposit? |
| Video Uploader | Video From Napkin Finance |
| Upload Date | This Video Uploaded At 28-08-2016 05:28:35 |
| Video Discription | Finances can get messy. That’s why we have napkins for you. Simple, visual, stress-saving financial tips and news from Napkin Finance! http://napkinfinance.com The Certificate of Deposit Napkin: https://napkinfinance.com/napkin/what-is-bank-cd/ Transcript: Certificate of Deposit A way of earning interest on the money you are saving by looking it away for a certain period of time. Called certificate of deposit- because banks give you a certificate stating Amount you deposited Interest rate being paid How long the money must remain in account CDs keep your money safe while earning interest However, if you try to take money out, there will be penalties. How do CDs work? Buy a CD at a certain price Interest will compound (grow) annually CS will earn money for just sitting there You’ll receive your original amount + interest So if you purchase a: $10,000 CD 4% interest rate 1 year term After a year, you’ll receive $10,400 ($10,00*1.04) = $10,400 Pros Considered very safe Fixed or variable in interest rates Easy to open Cons Low liquidity Low interest rates Should I invest in a CD Can you set money aside and not touch it? Do you already have emergency funds? Do you need portfolio stability? Can you handle loss on inflation? “If you answered ‘yes’ to all of these questions” You are ready to start investing in CDs. Added Bonus In the United States, unlike in other countries, deposits are protected by the Federal Deposit Insurance Corporation (FDIC). [-ESCRuQuGIY] |
| Category | People & Blogs |
| Tags | CDs | Certificate of Deposit | interest rate | Denomination | Maturity Date | compound | what is a certificate of deposit? | money for dummies | how to learn finance | how to invest | how to cds work? | easy money | how to learn money | learning about money | learning about investing |
