Putting your savings on turbo boost for a house down payment or as a supplement to retirement is possible. One way to get more from your nest egg is with a certificate of deposit (CD). You deposit a minimum amount of money required, and the funds stay locked there for a certain time period while interest helps increase your savings.  Here are a few benefits of opening a CD.

5 Perks of Using a CD

1. Fixed Annual Percentage Yield

The annual percentage yield (APY) offered with a CD is fixed for the entire term. This means you won’t have to worry about stock market fluctuations that will affect your savings during this time period. The fixed rate offers you stability as your funds continue to grow over time. 

2. Different Term Options 

Most CDs are available in terms ranging from three months to five years. For example, you might secure a $1,000 CD for one year for a short-term goal, such as saving for a car. You can also go with a long-term CD if you plan to retire soon or pay for a child’s college education. Essentially, you pick the term that aligns with your unique financial goals. 

3. Competitive Rates

If you decide to open a CD, the interest rates are likely to be higher than those offered on a savings or money market account. More competitive rates make a CD all that more appealing. The higher they are, the more your deposit funds will grow.  

4. Low Maintenance

Once you’ve selected the preferred CD term and made the deposit, it’s pretty much a set-it-and-forget-it account. Your funds remain there until the CD matures. As the maturity date approaches, you can choose to continue on with the same term or withdraw the funds without penalty. You can also select another CD with a new term.

5. Collateral for a Loan

Instead of using a credit card with higher interest rates or withdrawing from your CD for emergency expenditures, you can borrow against your non IRA CD for a very low rate and excellent terms.

Chattanooga First Federal Credit Union is the premier financial institution that residents of Hamilton County, TN, turn to for attractive CD options. Their terms range from six to 60 months, with a minimum of a $2,500 deposit to open. Their most current interest APYs are listed on their website or call a credit union representative to inquire on “Special Rates" offered periodically. If you’re seeking a faster way to grow your savings, call (423) 267-7621 to speak with a representative.