Offbeat Offerings: Credit Union CDs
A certificate of deposit, or CD, is a savings vehicle that entitles the holder to earn a certain interest rate over a specified time period. A CD can be issued in any denomination with varying maturity dates.
CDs issued by credit unions often offer higher rates than other CD issuers.
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A CD is a promissory note issued by a bank, thrift institution or credit union. It’s a time deposit, which means that the banking institution keeps your money for a stated time and there is a penalty for accessing the money prior to the maturity date.
This type of investment is less liquid than a cash deposit, such as a checking or money market account. Because the bank expects to keep the deposit for the stated time period, interest rates are usually higher compared to cash deposit rates.
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