How would I go about with getting a CD with my local bank?
Answers:
A CD is a FDIC insured account. This means you are insured up to $100,000 if the bank should go bankrupt. CDs are for a specified period of time with the shortest time frame being 3 - months and the longest being around 5-years. CDs require no investment professionals and can be done at your local bank. Keep in mind that interest rate is not the only thing to look at on a CD. For example $1000 put into a 3 month CD at 3% will earn $7.42 in interest over the 3 months. Whereas at 2.5% you earn $6.19. Sometimes it is easier to keep you CD where you have your accounts instead of worrying about finding a rate that will earn you a few extra cents.
A Bond is basically a loan you give to a business. Typically this is a way for a business/city/county/state to get money for projects. There are different types of bond ratings ranging from the safest (A rating) to less safe (C rating). It is possible to loose the whole investment if the company you lend the money to goes bankrupt. Bonds usually pay interest once a year and they are bought in $1000 segments. You must go through some sort of investment portal to purchase one (investment advisor, online stock trading site, etc). Typically bonds have a slightly higher interest rate than CDs and usually run for 3-10 years.
A subset of bonds in the US Savings Bonds, however these do not pay yearly interest and have a low interest rate. They are gaurenteed though, so there is no risk of loosing the original investment other than loosing the Bond paper.
i have no idea
Just walk in the front door. If you already have an account with them, you may even be able to open a CD online or over the phone.
look in the local paper for advertised special CD rates.
A bond is for a much longer time. a CD can be for a few months.
You go in and tell them you want to get a CD. they will ask you stuff like your name address, ss# (for tax), etc. and how much you want to put in it. They will ask you how long you want it for and tell you if there is a min. amt or time on a partcular interest rate. You decide which you want and they will give you a record of the CD. They might also ask you who you would like to be able to cash it (POD-payable on death) if you pass away before it matures.
You will get quarterly statements showing the CD amount and how much in interest has been added. You will get a paper in the mail just before it matures telling you that it will be maturing on such and such a date and you will have ten days after that date to go in to the bank and cash it out to get your money back or you can leave it alone and the terms will continue for the same period all over again. (ex. 1 yr to start and then again 1 more year)
A savings bond pays much less in interest and takes a lot longer to mature (i think they are 8 years now) and you also will have to keep track of the actual bond and keep it safe yourself. If you lose it or it is otherwise destroyed there is NO record of it and you lose the cash. I don't see any real advantage in getting a savings bond over a cd.
You need a $1000.00 minimum to put into a CD at a bank. They have terms from 3 months past 48 months. A CD matures at the end of the term (3months or the amount of months you choose) and you can then retrieve your money plus the (example) 3.9% of the intrest on the CD. All you have to do is go into the bank, go to customer service, and tell them you are looking for a CD. Once you put money into a CD you CAN"T touch it until it matures. usually credit unions have better percent rates. Shop around its your money, make it work for you.
Savings bonds are exactly that. They are for saving long term and at a lower percent rate. Example. You buy a bond that is worth $50. for the banks price of $25. In 7 or 8 years, that savings bond in now worth $50.00, Maybe $75.00. Your best bet is to go a CD if you have the money to put down. If you are looking for a place to put your money wisely and not touch but want a much better intrest rate than a regular savings or money market account, the CD. Once you lock in on a percent rate for a term (example 3 months) that rate wont change. I have done this myself.
1.) Walk into the bank branch and tell the Customer Service Representative what you want.
2.) A CD is a certificate of deposit. It is usually a FDIC insured bank deposit with a fixed term in months (6 months through 60 months is common) and restricted access to subsequent withdrawals and deposits (sometimes none at all are allowed).
Frequently you deposit a sum to a CD and at the "maturity" the bank will give you the money and the interest. There are some small variations to this at various banks.
3.) A "bond" is normally a financial instrument that has a fixed term of maturity (the time when you get you full amount back) and a fixed or variable interest rate. It is not insured by the FDIC.
Bonds are usually more complicated than bank CDs and normally require larger sums of investment than CDs.
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