A CD, also known as a certificate of deposit, is a way of saving your money that requires you commit to a monthly contribution over a fixed number of years. Issued by the bank, it’s similar to a savings account in that the CD is federally insured by the FDIC. For all intents and purposes, this is a low-risk, high-reward investment. As a rule, you agree to not withdraw funds until the date comes to do so. If a withdrawal is made before the time agreed upon, you will be subject to a penalty. However, as your investment matures, the more interest you accrue. The accrued interest adds value to your CD. The interest rate is set at the very moment you open your CD.
For more information on the types of CDs available, contact us today.
What’s an IRA?
An Individual Retirement Account, known as an IRA, is a method of savings that you establish on your own. It’s a way to save for retirement. You can set up a tax-free, tax-deferred account in a way where you can contribute a set amount of money monthly. Your money will mature until the day you retire or reach the date of withdrawal. There are two types to choose from: a traditional IRA and a Roth IRA. With a Roth IRA, early withdrawal comes with a penalty. In comparison, with a traditional IRA, you are allowed to withdraw under any circumstance.
For more detailed information on both IRA options, contact us today. Our financial experts will be happy to answer your questions.