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Tuesday, August 11, 2009

Bank CD Rates Give You Very Little Return

By Pete Veslick

Low interest rates have been around for a while now and it looks like nothing will change for some time. For someone trying to buy or refinance a home, low interest rates are great. But for someone with lots of free cash trying to find the best CD rates, they are going to have a tough time making any money.

Low interest rates hurt anyone who has money and doesnt need to borrow. Typically, seniors fall into this category and they are the single largest group that gets hurt at times like this. Seniors should have most or all of their money in safe investments such as CDs, money market accounts and government bonds. When interest rates are low, this means they are earning very little money and for a senior on a fixed budget, this is not a good thing. Seniors get very little media attention but it must be noted that in this down economy, seniors are suffering right along with the rest of us.

If you are looking for the best CD interest rates, you need to look in different places than your local bank. Right now many people are trying to find the absolute best rates they can find and they will have to search on the Internet to find them. No longer can you just look in your city and expect to find the best rate. A nationwide search is necessary to find the best CD and money market rates and luckily the computer and Internet allows you to do that.

Now though, you first step might be to hop online and start searching. You will have access to hundreds of banks and financial institutions any of which might be offering the highest yields. You can transfer the money electronically to any bank and so it matters not where the bank is physically located. Some people will not feel comfortable with doing this and remain with their local banks and that is understandable. However, to truly find the best CD rates, you need to be looking online.

If you have a bank CD that is about to mature, there is something you should be aware of. If you let it automatically renew, you will not be given the best CD interest rates for your renewed CD. The bank will never tell you this but in order to get the highest rate they offer, you will have to go in to the bank, close out the maturing CD, and then open a new one. This is very inconvenient to have to do every time one of your CD's matures but that is the only way you will get the best interest rate. You would think that your CD would automatically be renewed at the going highest rate but with most banks, this is not the case. - 23208

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