You are likely the owner of a few types of investment accounts, such as a checking and savings account. You may not be aware of another kind of account, however, known as a Certificate of Deposit. CDs, like savings accounts, are a great tool for putting away extra cash and letting it collect a high interest rate over time. You can benefit from a high CD interest rate that usually outperforms traditional savings account interest rates.
In light of the recent economic downturn, you have probably wondered at some point about what would happen to your money if your bank went under along with your high interest CD account. Do not fear, there is some protection from such an even offered by the Federal Deposit Insurance Corporation (FDIC).
The goal of the FDIC is to preserve confidence in the U.S. financial system. They do this by insuring deposits into banks and other FDIC-insured institutions. The FDIC identifies risks and solve problems within the financial system in order to limit the effect a failing financial institution would have on our economy. The total amount the FDIC insures has recently been raised to $250,000. This covers money belonging to a single depositor in any checking, savings or other deposit account, at any one institution.
You can rest assured knowing the your money is safe under the FDIC. When you want to find a CD account with a high interest rate, turn to Phoenix Banking Rates to do the comparison shopping for you so you can begin earning high rates today.
