How Can a CD Help Me With Upcoming Expenses?
Learn how a CD can help you with upcoming expenses
Learn why CDs are a safe and secure way to save.
A certificate of deposit or CD is a safe and secure short-term investment. You'll see a return on your money without any of the risks involved with long-term investments such as stocks, and it's federally insured against loss.
A CD can let you save for expected purchases or emergency needs while earning higher interest than a savings account. Say you're planning to buy a car or need a down payment on a home in six months or a year. Purchase a CD that matures in that time and you'll have the money plus interest exactly when you need it.
When you buy a CD, you're required to keep that money in the account for the specified period you choose. That could be anywhere from a few months to five years or more. The longer the term, the higher the interest you earn. If you withdraw the money early, you'll have to pay a penalty, but the funds are liquid. In an emergency you'll have your cash in hand quickly.
Your interest earnings can be spent right away, but the better option is to reinvest it. Through compound interest, the CD's value grows faster over time. Unless you choose to be paid, the interest is rolled over automatically.
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The information provided is not intended to be legal, tax, or financial advice. BB&T hopes you find this information useful but we cannot guarantee that it is accurate, up to date, or appropriate for your situation. Financial calculators are provided to assist you in estimating the approximate costs associated with any bank activity. Your actual costs may vary. You should consult with a qualified attorney or financial advisor to understand how the law applies to your particular circumstances or for financial information specific to your personal or business situation.
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BB&T and SunTrust have merged to become Truist. Both institutions will continue to offer independent product lines for a period of time. This may include differing underwriting guidelines, product features, terms, fees and pricing. Our friendly teammates at your local SunTrust branches will be happy to walk you through their respective products. You can also learn more by contacting them at 800-SUNTRUST or SunTrust.com.