Before the proliferation of the internet, finding the best CD rates was simple and straightforward. You just had to see the CD rates at a few banks, compare these prices and purchase the certificate of deposit that gave you the highest yield. Today, however, you need to strategize and deliberate as you will find plenty of options with meager rates.
When you are looking for some of the best CD rates online, you need to consider three important features. First, rates are higher for longer CD terms. For instance, a CD term that is five years will have a much greater yield than say a one-year CD. Second, if you close a CD before it attains maturity, you will incur an early withdrawal penalty. This penalty differs with banks as well as CD terms. Third, you cannot make a partial withdrawal of a certificate of deposit. You must withdraw all or nothing, unlike a savings account.
Below are a few strategies you can use to find the best CD rates that will give you the highest yield on your certificate of deposit.