Due to the overall weak economy, the federal government has kept their key interest rates low to encourage people to borrower money and buy products and services. While this is great for people looking to purchase a home or car, those looking to save money in risk free accounts have trouble finding high yielding accounts. Luckily, banks such as SunTrust banks still offer high interest accounts to their customers.

The best yielding savings accounts and SunTrust Bank are their certificate of deposit (CD) accounts. The interest rate that is offered on a CD at SunTrust varies based on the length of term, but the rates offered are very competitive compared to other financial institutions. All CD products at SunTrust Bank require a minimum deposit of $2,000.

For those looking for a short term CD, SunTrust Bank offers a 10-month penalty free CD with an interest rate of 0.50%. They also offer a traditional 10-month CD that has an interest rate of 0.80%, but, like all other SunTrust Bank CDs, the CD will come with an early withdrawal penalty. For those willing to deposit their money for a longer period of time, customers could receive a 25-month CD with an interest rate of 1.60% APY or a 39-month CD with an interest rate of 2.30% APY. The longer CD product available to customers of SunTrust is a 59-month CD, which has an interest rate of 3.00% APY. All of the CD products at SunTrust, excluding the 10-month CDs, can be opened as either at traditional CD or an IRA CD. The IRA CD will allow a customer to gain interest tax free.

For those looking for higher interest, but do not want to commit their funds for such a long period of time, SunTrust presently has a special CD offer. This CD product, which is available as either a traditional CD or an IRA CD, is 26-month CD that has an interest rate of 3.00% APY.

CD’s or certificates of deposit are a well known, and very safe investment strategy. CD’s are investments with a predetermined interest rate over a predetermined time period, also known as the maturity period. The CD rates vary from one financial institution to another, but the principle is the same in that you invest a sum of money over time and the financial institution pays you based on the CD interest rate.

Liquidating a CD is a great pay off, but if you can stand to leave the investment active you can renew the CD and continue to earn with a very stable platform. Since the stock market does not affect the CD rate, certificates of deposit are a great anchor in uncertain economic times. The CD rates are generally proportional to the amount invested and the length of time to mature. Many options are available, and one very popular strategy is to invest in a CD that gives the option of adding on to the original investment. Each time the CD matures, you renew with slightly larger investment, and therefore continually increase your pay outs and overall investment worth.

On the other hand, liquidating your certificate of deposit at the right time is also a very effective strategy. Most financial institutions have CD’s that pay out monthly, quarterly or yearly and provide a steady source of income during the maturity period. Once the CD has matured, you simply cash it out. Because the certificate of deposit is so stable, you have the peace of mind that your investment will pay off in a designated time frame. The only downside to this is that CD rates can and will fluctuate, so locking into the best CD rate is paramount, and will need to be carefully researched each time.

When searching for a place to put their hard earned cash, many people choose to purchase a CD at a local bank. Doing so allows them to earn a specific percentage of interest on their deposit over a specific period of time. The longer the deposit remains in the CD, the higher the interest. Obviously when searching for a bank to purchase a CD everyone is asking the million dollar question: “Which bank has the highest interest rate?”. It may seem like one of the big national banks, such as Bank of America, would be a safe bet.

However, according to bankaholic.com Bank of America may not even make the top 25 list nationally. Bankaholic.com complies data on CD rates from banks all across the country. It then examines that data to find the best interest rates, and then puts those banks in order by rank. For a one year CD Bank of America is not seen on the list at all. The highest interest rate on a one year CD was claimed by Aurora Bank, with a rate of 1.57%. It should be noted that this site examines banks from all across the country, and therefore the best rates may be at banks that are not local.

Aurora Bank for example, is located in Deleware. It may be more helpful to use a website such as bankrate.com to help find interest rates at your local bank. Bankrate.com will allow you to choose your state and city, and then it will narrow your results to banks in your area. It also allows you the option to enter your zip code for even more personalized information. In some cases Bank of America did make the list of best interest rates in certain areas of the country. One final option that individuals can take is to go to the financial institutions themselves, and ask about the interest rates on their CD’s. Many banks will have that information right out in the lobby. That’s good old fashioned comparison shopping. In conclusion, while Bank of America offers many services, their CD’s may not always have the best interest rates.

Like many banks, SunTrust Bank is not able to offer very high rates on their certificate of deposit products.  The low rates offered by banks are attributable to various factors.  The main reason why rates are rates are so low is because the federal government has kept their key interest rates low to encourage consumers to spend and borrow money.  Unless the economy picks up in the near future, CD rates will continue to be low throughout the year.
 
According to their website, SunTrust Bank offers their customers a variety of bank rates on certificates of deposit that range drastically in term.  A 10 month no penalty CD offered by SunTrust Bank comes with an interest rate of 0.50% APY.  A traditional 10 month CD comes with an interest rate of 0.80% APY.  For an individual who is willing to lock in their money for a longer period of time, a 25 month CD comes with an interest rate of 1.60% APY.
 
The highest CD rates offered by SunTrust Bank come with even longer terms.  A 39 month CD offered by Sun Trust bank has an interest rate of 2.50% APY.  A 59 month CD comes with an interest rate of 3.00% APY. 
 
Beyond traditional CD products, SunTrust also offers IRA CD products.  The benefit of the IRA CD products is that the interest will grow untaxed.  Also, in some situations the funds deposited into an IRA certificate of deposit could also be tax deductible.  However, the funds deposited into the CD and the interest received will not be able to be withdrawn penalty free until the account owner is 59 and a half years old.
 
All of the CD products offered by SunTrust bank come with a minimum deposit of $2,000.  Beyond the set term CD rates provided on the Sun Trust website, customers have a lot of flexibility when it comes to opening a certificate of deposit.  Customers can customize their CD and select any maturity date ranging from 7 days all the way up to 120 months.  The CD’s value will be guaranteed and insured by the FDIC throughout the term.

First, to determine the highest CD rates, decide how long you want to invest the money into the CD. Make sure that the money you invest is money that you are comfortable not having access to for that period of time, or has no penalty or a penalty that you are comfortable paying if you find yourself in circumstances that you need the money.

Next, decide whether you want to open the CD in a bank that is local to you. Most banks these days offer online banking, so this is simply a matter of convenience. Some people prefer to bank with people that live near them, or are uncomfortable putting their personal information in an online form. Bankrate.com offers free tools to determine the best CD rate either locally or nationally.

To find the highest rate on a CD, simply go to www.bankrate.com/cd. Decide whether you want to search amongst banks that are near you, or operate nationally. Enter the length of time you wish to have the CD, and if you are investing more than $100,000, select “Jumbo CD”. A list of banks offering the CD of the length specified will appear on the next screen. Click the word “Rate” to sort by highest rate. Most of the banks listed will have a website or contact information.

You may also choose to simply contact the banks near you to find out their CD rates, and compare them for yourself. Either way, you are well on your way to opening a CD with a high rate of return.

Like all savings banks, Wells Fargo can only offer CD rates with historically low rates.  The interest rates on CDs are very low because federal interest rates have been kept low in an attempt to encourage buying and to reignite the economy.  Due to poor economic indicators, Wells Fargo CD rates should not be expected to increase too dramatically in 2010.
 
According to the Wells Fargo website, the bank offers various different bank rates on varying different certificates of deposit.  Wells Fargo presently is offering three standard CD products.  The 3 month certificate of deposit rate is 0.10% APY regardless of minimum deposit.  The minimum deposit on a Wells Fargo CD ranges from $2,500 to $100,000.
 
For a 6 month certificate of deposit, the bank rates increase slightly.  With a minimum deposit of $2,500, the CD rates are 0.20% APY.  For someone looking for a slightly higher interest rate, they could attempt opening a 12 month CD.  Well Fargo offers a 12 month CD rate of 0.30% for someone looking to open a CD with a minimum deposit of 0.30%.  For someone looking to open a much larger certificate of deposit, a 12 month CD with a $100,000 minimum deposit can be opened with a APY of 0.35%. 
 
While the standard CD products and Wells Fargo are quite low, the bank does presently offer their highest CD rates with their special offer CD products. With a minimum deposit of $5,000 a Wells Fargo customer could open a 15 month CD with an APY of 0.55%.  With a $5,000 deposit Wells Fargo offers an interest rate of 0.90% APY on a 21 month CD and an interest rate of 1.40% on a 28 month CD.  The 15 month and 21 month CDs come with a renewable term of 12 months and the 28 month CD comes with a renewable term of 24 months.    
 
The highest CD rate available to Wells Fargo customers comes with their 35 month CD.  With a minimum deposit of $5,000, a Wells Fargo customer can get a CD with an interest rate of 1.90% APY.  This 35 month CD also comes with a renewal 24 month term.

Introduction

Even during difficult economic times, certificates of deposit continue to be an investment option for investors. There are various types of CDs. If you are an investor, you have to find a CD that fits your particular investment goals. If you are interested in CDs, the following are some of the options that you have.

Traditional

The way that traditional CDs work is that you deposit a specific amount of money for a specific length of time. As a result, you receive a specified rate of interest. At the end of the investment term, you could cash out. Or, if you prefer, you could simply roll over the CD for another investment term. If you wish, you could add more money during the investment term or if you decide to roll over the CD. However, you should note that there are penalties for withdrawing your money early. In fact, the penalties for withdrawing your money early can be very severe.

Bump Up

If you are interested in taking advantage of rising rates, then you might be interested in getting a bump up CD. Bump up CDs are flexible in the sense that if you buy a CD at a specific rate and then later the bank decides to offer a higher rate of interest, having a bump up CD enables you to tell the bank that you would like to get the higher interest rate for the rest of the investment term. Granted, banks that offer this option may only allow you to have one bump up per investment term.

Liquid

Sometimes investors want to withdraw money from a CD without having to face harsh financial penalties. In other words, they want their CDs to be liquid. It is true that’s sometimes you might have to keep a minimum amount of money in the account in order to be able to have a liquid CD. Also, you have to read the fine print and make sure that you understand when you can make a withdrawal. For example, you need to understand exactly how much time must elapse before you are able to make your withdrawal. Do you have to wait ten days? Or, do you have to wait much longer? Another issue that you have to consider is the issue of how many times you can make withdrawals. For example, can you make a withdrawal only one time? Or, are you able to make multiple withdrawals?

Zero Coupon

Just like there are zero coupon bonds, there are also zero coupon CDs. The way that this works is as follows. For instance, if you purchase a seven year $200,000 CD with a 5% interest rate for $100,000, there would be no interest payments for you during the seven year term. Nonetheless, you would still have to pay taxes on the interest even though you are not receiving the interest yet. Thus, it is very important that financially you are capable of paying the taxes on the interest even though you are not going to get the interest until the investment term is over. So, if you are going to purchase this type of CD, make sure that you can truly afford it and make sure that the tax payments will not put you at financial disadvantage.

Callable

Callable CDs are certificates of deposit that the bank can call away from you after the protection time period has ended. For example, if you had a one year CD with six-month call protection, it means that the bank can call the CD after six months. The reason that banks offer callable CDs is that the investor is assuming the risk. Granted, due to the fact that the investor is assuming the risk, callable CDs will tend to have higher yields than other CDs.

Brokerage

CDs sold through brokerages are known as brokerage CDs. At times, banks will use brokerages in the process of finding investors who want to buy CDs. Brokerage CDs sometimes pay higher interest rates than the CDs that you might find at the bank. The reason for this is that the banks that use brokerage CDs are in competition. These particular CDs tend to be more liquid than the CDs you would get at the bank due to the fact that these CDs can be traded on the market in the same way that bonds are traded. There are also call options on brokerage CDs. Granted, there is no assurance that you will not lose in this trading process. Holding the CD until it matures is the only way to make sure that you get your investment principal and interest.

High Yield

Some CDs are high yield CDs. These CDs do sometimes require an investor to invest a minimum amount in order to get the CD. However, these CDs offer the highest interest rates available. Typically, in order to find these, you should do an internet search because that will quickly enable you to see what rates are available. Also, the interest rates do change. For example, the highest yield CD in one month may not be the highest yield CD in the next month because some other bank may start marketing a higher yield CD. You just have to constantly check in order to see what is available.

Jumbo

Jumbo CDs are usually $100,000 or more. Jumbo CDs carry low risk and are very safe investments for individuals who want to invest a large amount of money. Jumbo CDs are similar to other certificates of deposit in the sense that the investor invests the money and then the money is held by the bank for a specific term. At the end of the term, the investor receives the principal plus interest. Of note, due to the fact that it typically takes a lot of money to invest in this, millionaires, investment funds and organizations with a lot of money tend to invest in Jumbo CDs. They do this because the jumbo CDs give them a stable source of income.

Conclusion

Investing in CDs need not be a dilemma. Remember that you have several choices of CDs to invest in. Also, you can invest for a one year term or you can invest for a term of more than one year. If you decide to invest in CDs, the main thing is to make sure that you understand the terms of the agreement. Make sure that the terms are acceptable to you and that you can afford to invest your money. If you understand the terms and if you can afford to invest, CDs can be a good investment.

A traditional CD is a certificate of deposit that pays interest on an investment over time. A CD is one of the safest investments out there, and they come in a wide variety of terms, interest rates and investment levels. A CD is commonly known as one of the best ways to start a traditional IRA. Regardless of what particular type of CD you decide on, there are a multitude of banks, credit unions and financial institutions that offer several types of traditional CD’s. Most these institutions offer advice and planning strategies that can match you with the investment for your situation. Traditional CD’s also give you the extra peace of mind of knowing you are protected by the federal government through FDIC for banks and traditional financial institutions, and NCUSIF for credit unions.

A certificate of deposit offers many alternatives for investment. Most traditional CD’s pay a fixed interest rate over a predetermined time frame known as the maturity period. This makes them a very safe investment strategy because the fixed CD rate is not subject to market fluctuations. This is a notable feature in today’s volatile economy, and stresses the importance finding the best CD rates. Some institutions offer variable rates in the case that interest rates increase, and some even allow additional financial contributions to your initial investment. Some institutions also offer an automatic renewal service that renews your CD at the end of the maturity period for you so your investment keeps growing.

Certificate of deposit time frames usually vary from 3 months to 5 years, with each individual financial institutions having their own guidelines. This allows you to shop around for the best interest rate, time frame and investment level. CD’s offer a simple and safe investment opportunity for just about anyone, just make sure you are prepared to leave the investment until the maturity period has passed, many institutions will forfeit your interest and charge hefty penalties for early withdrawal. Generally speaking, the greater the length of the maturity period, the greater the interest rate, so it is in your best interest to look for longer maturity periods with higher CD rates.

The economic world offers plenty of opportunities, so those who are looking to make their cash grow will have some interesting options at their disposal. Whether you invest in CDs or a money market account depends upon your situation and your particular investment goals. With that being said, the CD rates that you can get right now will impact your decision in a big way. So should you choose a money market account or a solid CD in 2010? This question can have a slightly different answer for each investor out there.

CD rates versus Money Market Rates
No matter which investment company you work with, you will probably have access to both CDs and to money market accounts. Right now, a one year CD rate will be anywhere from 1.5% to 1.8%, depending upon which company you are working with. You can find out the latest CD rates available from your financial institution by either going to your company’s site or using one of the comparison sites online. This way, you will see which actual rate is available for your money.

Today’s money market accounts are a little bit lower, but they provide individuals with the chance to pull their money out at any point. This means that you will want to figure out how much access you need to the money. Some people just want to put it up and attain the certain growth that goes along with CDs. Others will need to pull their money out at some point, because of an investment opportunity or because of a personal need.

CD rates on the rise?
There is some thought out on the financial market today that CD rates are going to be going up in the near future. This means that right now they are at a low point. If you were to invest in a CD right now, you might miss out on a higher rate that comes about before your CD term is up. If you feel that you want to wait things out or you have some other investment opportunities in mind, then using the money market option can help you with flexibility. This is why it is a highly personal choice and it really comes down to what you think CD rates are going to do in the future.

Many conservative investors who invest in certificates of deposit (CD’s) are starting to wonder if CD interest rates are going to back up towards their pre-recessionary levels. This is a fair question to ask because according to the BankRate.com’s CD interest rate page, current CD interest rates are ranging from 0.99% to 1.75% for one-year CD’s to 1.94% to 3.49% on five-year CD’s. This range makes one wonder if CD interest rates will ever go back up to near their pre-recession levels.

Since no one can tell for certain over the long haul, here is a prediction about what might happen to CD rates in the next six to twelve months.

In the next six to twelve months, conservative investors who invest in certificates of deposit that mature in five years or less will continue to see flat CD rates that pale in comparison to pre-recessionary CD rates. This is the case because according to a blog post dated November 13th 2009 located at The Wall Street Journal’s blog site (http://blogs.wsj.com), most Federal Reserve analysts believe that the economy has not completely recovered from the current recession.

As a result of the Fed’s belief that the economy has not fully recovered from the current recession, it will not stop its “easy money” or “accommodative” monetary policy that is designed to promote spending and investment in the public sector. As a result, we will continue to see the Fed’s open market interest rate stay near 0% to 1% until the economy improves to such a point that higher interest rates can be sustained in the economy. As it stands now, the economy is still too fragile to warrant higher interest rates on the open market.

This does not bode well for CD rates in the next six to twelve months because most CD rates are tied directly to the Fed’s open market interest rate. As a result, there is no incentive for banks to raise CD rates to higher levels until the Fed decides to raise its open market interest rate from its currently rock bottom levels.

If you are looking to invest now, do not lock in your money for more then a two years. Rates should be on the rise by then.