Short-term high yield CD?

Wed, Jan 16, 2008

Savings

I’m looking for a short-term (~4 month) high yield CD. My current CD with Bank of America will mature in a few days and it had a 5.45% APY… I can renew this CD at 4.80% APY but am wondering if anyone knows of a better one!Thanks!

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12 Responses to “Short-term high yield CD?”

  1. pbucelwicz Says:
    January 16th, 2008 at 1:13 pm

    4.80% is a great rate right now for a short term CD. Just looking around a bit, that’s the highest I found for a 4 month term. I say renew the CD with BofA if you are comfortable with their service and was happy with your first CD with them.

    What was the term length for your 5.45% CD?

    Reply

  2. ccastracane Says:
    January 16th, 2008 at 1:16 pm

    Thanks for the info.. it was a 4 month CD.

    Reply

  3. sergik12 Says:
    January 16th, 2008 at 1:35 pm

    Why a 4 month CD? E-Trade has a 6 month CD at 5%. I have not seen any 4 month CDs that are above 4.80%

    https://us.etrade.com/e/t/jumppage/viewjumppage?PageName=kingofcashcd&PageName=kingofcash&tb=3725&WT.mc_id=3725.srch=1

    Reply

  4. ccastracane Says:
    January 16th, 2008 at 1:44 pm

    The 4 months isn’t set in stone.. but I’m graduating in 4 months and am concerned that I will need the money sooner than 6 months from now. But, it is definitely something to consider. Thanks for the information!

    Reply

  5. petebow Says:
    January 16th, 2008 at 10:16 pm

    sorry im no pro here, but is it worth having your money locked up for two extra months at 5% or would it be better to have it in a 4month at 4.8% then renew it for another four? like wouldnt you be better off getting out two months earlier and reinvesting sooner for .2% less? i dont know if that question makes sense.

    Reply

  6. pbucelwicz Says:
    January 16th, 2008 at 11:26 pm

    I have no insight on if the rates will continue to lower, but a CD is only better than a High-yield MMA if the rates are going down. ccastracane made a good call locking in the 5.45% for 4 months. The next 4 month term will be for 4.80%. If in another 4 months the rates go down again, ccastracane will be locking in a lower rate again, which the 6 month 5% CD would have been better.

    I choose to put my money in a high yield MMA. You get similar interest rates as the highest yield CD’s at the time. A Money Market Account has a variable rate which can range up and down, but you get the freedom of using that money if you need. You can also add funds to it whenever you want. I suggest after the next 4 month term is over. Invest that money into a high yield MMA or Savings account. You will gain top interest rates while debating if you need to use that money or not.

    Reply

  7. pbucelwicz Says:
    January 17th, 2008 at 8:51 am

    I just found this 5.25% 4 month CD. It’s an internet only deal and new money, which yours will be. This is another option for you.

    http://www.indymacbank.com/Individuals/Banking/page.asp?pSection=pd4MonCDRate&imb=BkR:ldr:4mo

    Reply

  8. sergik12 Says:
    January 17th, 2008 at 9:02 am

    Good find pbucelwicz. I would be careful with Indymacbank, they are very likely to go out of business. They took huge loses on the sub prime and the stock is trading below 5 dollars at this point. I would not buy a CD from them for more than 100K since the fed only insures you up to 100k loss.

    Reply

  9. pbucelwicz Says:
    January 22nd, 2008 at 11:53 am

    Did you renew your CD yet? The feds just cut the rates again.

    Reply

  10. ccastracane Says:
    January 22nd, 2008 at 11:58 am

    Yes I renewed it last week! They only initially renewed it at 4.34%, so I called and asked why I wasn’t getting the rate I saw on the website (4.80%), and they said it was because it wasn’t new money – however, I complained and they gave me the higher rate since I am such a “valued customer”.

    Reply

  11. pbucelwicz Says:
    January 23rd, 2008 at 8:37 am

    Good Job! Way to lock in the high interest before they cut the rates again.

    Reply

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