A certificate of deposit (CD) is a deposit account at a bank or credit union where you agree to leave your money for a set period, often from a few months to several years. In return, it usually pays a higher interest rate than a regular savings account. CDs may require a minimum deposit. Withdrawing early may trigger a penalty. Eligible CDs at insured banks and credit unions are generally protected by federal deposit insurance.

Click Here for our lesson on Choosing the Best Banking Option for You