How can I find the best variable CD rates?

Variable CD rates could either go up or down depending on the direction of the market.  Unlike other CDs, the interest rate is not fixed. Hence, when market rates go up, the profit you can get with a variable CD can also increase. Needless to say, the profitability of a variable CD depends on market movement. If the economy is quite unstable, then investing in a variable CD can be risky because there is no guarantee that the rate you will get at maturity is higher than when you opened the account. Of course, with the current state of the economy where interest rates are increasing, this type of CD suits many investors.

Many investors claim that variable CDs offer higher returns compared to other types, but in order for one to take full advantage of its benefits, one must know every detail about CDs and investing. By doing this, you can have a good idea on when, where and how you should invest in this type of CD.

Variable CD’s work pretty much the same as the traditional ones. An investor is required to make a deposit to the account and is expected to have the money stay with the bank or the issuer until it matures. When the maturity date arrives, the depositor or the investor can withdraw all his funds with the agreed accumulated interest. The interest is what the bank has paid you for lending your money to them.

The U.S. Treasury determines the rates given on variable CD’s. Keep in mind however that interest rates are affected by many factors so the rate your bank offers may not coincide with the actual published rate. Rates can depend on the condition of the foreign currencies and or index in the market. Generally, variable CD rates are higher due to the higher risk of investment. One way to find the best rates is consulting a broker. Brokers have license securities hence they have the access to check on the available CD’s in the market. For you to have an idea about the status of the global market, have a financial consultant’s help.

Another way to find and understand the rates is making an analysis n the interest rates. While it is good to know the global market, it also pays to know the direction of your local economy. Being able to know the movement of rates is the secret to mastering the variable CD rates.

Making an investment with variable CD’s sure is a god way of enjoying a high level of profitability but without careful research, this could be impossible, while it is true that all investments come with a risk, one can get rid or minimize the negative effects with proper research and understanding. Just one wrong decision will let you say goodbye to your money. You wouldn’t like this to happen, would you?

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