Make Your Money Work as Hard as You Do
Help Your Money Help You
Money that isn’t earning anything is quietly losing value. Inflation raises the cost of everyday life a little more each year, so cash parked in a low-interest account or checking balance has to grow just to keep up. A certificate of deposit (CD) is one of the simplest ways to put that money back to work.
Here’s what a CD does for you:
- Locks in a fixed interest rate for a set term, so your return isn’t at the mercy of rate changes
- Keeps your savings growing steadily without you having to manage or move it
- Adds a built-in barrier between you and your money, which helps if you tend to spend whatever’s available
That last point matters more than people expect. If you’re a chronic spender, a CD’s early withdrawal penalty works in your favor. It keeps the money out of easy reach until the term matures, which makes it a good option for savings you want to protect from yourself as much as from inflation.
End of summer is a natural moment to think about this. If your budget stretched further than planned over vacations, cookouts, and kids’ activities, whatever’s left over is a good candidate to lock away before it disappears into everyday spending. Our article on recovering financially after summer vacation walks through resetting your budget for fall, and a CD is a solid next step once you’ve regrouped.
FAQs
What is a CD and how does it work?
A CD is a savings product that holds your money for a fixed term in exchange for a fixed interest rate, typically higher than a standard savings account.
How long do I have to keep my money in a CD?
Terms vary, often ranging from a few months to years. A Croghan banker can help you pick a term that matches your goals.
What happens if I need the money before the term ends?
Early withdrawal typically comes with a penalty, which is what makes a CD useful for savers who don’t want easy access to their funds.
How does a CD compare to a regular savings account?
CDs generally offer a higher, fixed rate in exchange for less flexibility, while savings accounts offer more access but rates that can move with the market.
Can I open more than one CD?
Yes. Many savers “ladder” CDs with different terms so portions of their savings become available at different times.
If you’re weighing a CD against other ways to grow savings, here are some more helpful reads.
Navigating Inflation: Smart Strategies to Stay Ahead
From grocery bills to utility costs, inflation continues to impact households. While you can’t control the market, you can control your strategy.
Plan Ahead for Holiday Spending
The holidays bring joy, but also big expenses. A plan helps you celebrate without financial stress.
Plan Ahead for Holiday Spending
Important Legal Disclosures
*Account subject to deposit account approval.