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if you take early withrawal then you have pay penatly.
there are a few banks that offer no-penalty CDs, which allow you to lock in an APY for a certain number of months but won't penalize you if you take your money out early.
While investing money in Cd you shouldn't also look for APY. you should also look for what is compound interest and easy to manage account.
CDs come in terms like 6 months, 1 year, 2 years, and up to 5 years. These are most common. Some banks offer odd term lengths with high rates, like 13 months.
Typically, you can't withdraw the money you deposit into a CD without penalty until it matures. However, some banks allow customers to withdraw the interest income that is paid into the account.
before investing in Cds make sure they are FDIC approved. Money in a CD at an FDIC-insured bank is protected up to $250,000 per person
You might be surprised to learn that when your CD term expires, the account will automatically renew for another term (usually of the same length) unless you take action.
One important thing to know is that the interest paid to you by a CD is considered taxable interest income, even if you don't withdraw it
By opening a CD within your individual retirement account, or IRA, you won't pay tax on the interest income you receive each year