With the Federal Reserve poised to lower interest rates in September, individuals looking to maximize their savings should consider opening a no-penalty Certificate of Deposit (CD). These financial products allow you to lock in higher interest rates while maintaining the flexibility to access your funds if needed. Traditional CDs often come with penalties for early withdrawal, which can be risky if you might need your money before the term ends. No-penalty CDs, however, provide a safety net by enabling withdrawals without penalties after a certain period. This feature is particularly advantageous in a fluctuating interest rate environment, where high-yield savings accounts may not offer the same stability. For example, a 6-month no-penalty CD can yield rates as high as 5.34% APY, compared to variable rates in savings accounts. While they require more management than traditional savings accounts, no-penalty CDs could be the perfect solution for those who want to secure their savings while retaining access to their funds.
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