A certificate of deposit, sometimes known as a CD, is a promissory note that is issued by a bank or credit union.
1. Safety
The fact that a CD is a relatively safe investment is one of its most attractive features. The matured CD will continue to hold its value even if the market changes.
2. Predictability
An investor knows exactly how much the CD will be valued at the end of the term when they make the purchase.
3. Better Returns than a Savings Account
Your CD investment gives you more than your saving bank account.
4. Flexibility of Terms
Investors can select the short-term or long-term CD option that best suits their financial position.
5. CDs may have low or no fees
Certificate of deposit accounts normally don't require a monthly maintenance cost.