February 5th, 2010 by Jennifer
You have to play the numbers game if you wish to find the best CD rates available. There are a variety of ways you can analyze a lot of CD rates at once to find the most desirable rate. Here, we’ll present a few of these methods.
Online Research and Credit Unions
You can do some research online to find which financial institutions are offering competitive CD interest rates. In fact, there are websites that specialize in presenting the most competitive rates currently available.
Keep in mind that credit unions can often provide you with some of the strongest CD rates on the market. This is because credit unions work as cooperative institutions. A cooperative institution pays its members back with high rates on savings.
Brokered CDs
You can also investigate brokered CDs to find strong bank CD rates (and credit union CD rates.) Only people who are licensed to sell securities can look for brokered CDs. But, since brokered CDs are entities that are actually traded, their value and interest rates can be a lot higher than a standard bank interest rate.
A financial consultant or broker can also advise you on finding the best CD rates available. Some of these consultants specialize in conservative investments such as CDs. This way, you can combine CD investment with other low-risk strategies to build a comprehensive portfolio.
Either way, it’s crucial that you shop around before you decide to purchase a CD. You need to make sure that you select the best interest rate possible. You are locking your money away until a maturity date, so be sure you invest it prudently.
February 2nd, 2010 by
If you’re willing to do some research, then you might find that a brokered CD offers the best CD rates on the market. Many people invest in brokered CDs in order to find strong CD interest rates that they might not have been able to find with a bank CD rate. Here’s a brief overview of brokered CDs.
How to Find and Buy Brokered CDs
When dealing with brokered CDs, a broker such as a financial consultant or advisor can shop around to find the best CD rates that are currently available. You can essentially bypass the banks and look at the entire market for your CDs.
The vast array of investment options attracts many investors to brokered CDs. This way, you can view CD competitiveness in the entire market. There is one major difference between standard CDs and brokered CDs. You actually have to purchase and sell brokered CDs, similar to fixed-income investments such as real estate (although brokered CDs are still a conservative investment.)
Only people who have a securities license can have access to brokered CDs. Typically, financial advisers, consultants, brokers, and brokerage firms can all survey the brokered CD market for you.
Advantages and Disadvantages of Brokered CDs
Also, brokered CDs generally pay off investors at intervals instead of only at maturity. Brokered CDs can also be traded in the secondary market for prevailing prices. These trades can have an overall positive or negative effect on your investment. Since you can sell brokered CDs on the market, brokered CDs offer a bit of freedom that bank CDs don’t.
There are risks associated with brokered CDs, as they are susceptible to market fluctuations. But, if you invest in strong brokered CD, you might just see a strong return that pays you off incrementally, instead of only at maturity.
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