$45,000 CD vs. $45,000 high-yield savings account: Which can earn more over the next year?
Summary
This article compares how much interest you can earn on $45,000 placed in either a certificate of deposit (CD) or a high-yield savings account over one year. Both have similar interest rates and federal insurance, but the CD offers a fixed rate while the savings account’s rate can change.Key Facts
- Both CDs and high-yield savings accounts currently offer around 4% interest.
- Both types of accounts are insured by the FDIC up to $250,000.
- A 3-month CD at 3.95% would earn about $437.94 in interest on $45,000.
- A high-yield savings account at 4.10% after three months would earn $454.32, slightly more than the CD.
- At six months, both accounts would earn the same interest, about $913.23.
- Over nine months, the high-yield savings account earns $33.42 more than the CD.
- After one year, the CD at 4.15% would earn $22.50 more than the savings account.
- If interest rates rise, a savings account could earn more since its rate changes; if rates fall or stay the same, a CD might be better because its rate is fixed.
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