Invest in a safe and flexible investment plan with liquid CD’s

Any savings plan is a good savings plan to help during the times of recession. There are many savings plans available through major financial corporations and banks, to help people plan their future. Certificates of deposits have proven very popular, since they offer good interest rates than any savings accounts.

There are many types of certificates of deposits available in the market today. Each one of them has its own advantages and pays different interest rates to the investor. Deciding which certificate of deposit to choose depends upon the individual requirement of investor.

Liquid CDs are popular because of the flexibility they offer to the investor. Liquid CDs are somewhere between the savings accounts and certificate of deposits. Liquid CDs lets the investor withdraw money from the investment at any time, without paying any penalties. In any other certificate of deposits, the investor cannot make withdrawals without closing the entire certificate of deposit. Even if partial withdrawals are to be made, some percentage of penalties that is charges on the entire deposit amount.

Another advantage of investing in liquid CDs is that when the interest rates in the market improves, the entire investment can be removed and reinvested into a higher paying investment plan. This flexibility is not available in any other kind of certificate of deposits. Usually, if the money is invested in certificates of deposits, then it is locked in that investment for the current interest rate until a long period of time, irrespective of changes in the interest rates. But in liquid CDs, there is no penalty to be paid and the investment is free for withdrawal at any point of time. Even in savings account sometimes, there are restrictions for withdrawals until the maturity.

Liquid CDs have one downside, however. The interest rates that the liquid CDs offer are only slightly better than the rates that a savings account offers. Usually other CDs offer much higher interest rates, even though they are not as flexible. But even with this drawback, liquid CDs are far better than savings accounts, because they lock the current interest rates and let the investors take advantage of growing interest rates. Also, some liquid CDs have restrictions on the number of withdrawals that can be made on the investments. So if the investor needs liquid money immediately, it is better to withdraw a little more than what is required or even withdraw the whole investment and reinvest when the interest rates grow.