EverBank today launched a 3-year MarketSafe Emerging Currency CD. I could write ad nauseum here about how inappropriate this investment is for most unsuspecting investors. I could write about why it shouldn’t be called a Certificate of Deposit. I could write about how I believe that EverBank is violating the 1933 SEC Act. But, wait a minute. I already did. This product is exactly the same as a product that EverBank offered in 2014 and that I wrote about extensively then (see my article here), except that they have replaced one dictatorship’s currency for another (swapping out the Russian ruble for the Turkish lira) and decided that Indonesia’s rupiah is more attractive than South Africa’s rand. The Chinese renminbi, the Indian rupee and the Brazilian real, however, remain constants in this product. The other things that remain a constant is that neither the people offering it nor those buying it have any idea what they are doing, and those buying it will not see any appreciation on their investment.

As a general proposition, this is the wrong time in the cycle to be playing with emerging markets, although some countries have unique circumstances that will enable them to outperform (perhaps Argentina). If you must invest, the play is to invest in those countries or in U.S. or European denominated debt through a fund offered by a big fund family that knows what they are doing in emerging markets (maybe Ashmore). And, if you insist on investing in currencies, the major investment banks offer structured products geared to lever appreciation in U.S. dollar terms should another currency (a single currency) appreciate against it. Under any circumstance, avoid this EverBank product.

The best 3-year CD rates are listed here.

Three years ago, the best online 5-year CDs were at or around 2.30% - 2.35%. At the time, I put a fair amount of my personal money in 5-Year CDs, and I recommended that readers of BestCashCow to continue doing the same.

I obviously regret not having put the money in Facebook or Netflix or Amazon! But, these CDs have given me safety for savings accounts and a return on cash well above that offered by any savings accounts for the last three years. To boot, at no time in the interim has it been possible to buy a 5-year CD at that rate. (In early 2016, the best 5-year CD rates briefly reached 2.25%, but for most of the last year-and-a-half, 5-year rates were below 2%).

Now, the best 5-year rates are back to 2.35%. Synchrony and Sallie Mae are both established online banks offering this rate and it seems tantalizing in light of where rates have been.

But, savings rates are normalizing quickly (see the best rates here). 2-year CD rates and 3-year CD rates offer returns close to the 5-year CD without the time commitment. I would be inclined to hold on the 5-year and stay in savings for now. Given the Fed’s continued tendency to raise interest rates over the next 12 to 15 months, I think we may see 5-year CD rates above 3% before Janet Yellin hands over the reigns of the Fed to Gary Cohn. In fact, the Federal Reserve continues to guide towards a Fed Funds rate at or above 3% in 2019 in which case savings rates and short-term CD rates will be at that level in less than 2 years.

Many other commentators will argue that you should jump on the 5-year CD at this point and pay the early withdrawal fee in a year if rates go up. We aren’t inclined to recommend this strategy here either. While Synchrony has an early withdrawal penalty of only 1-year’s interest and Sallie’s is 6-month’s interest, it is important to note generally that banks retain the right to refuse to allow early withdrawals (https://www.bestcashcow.com/can-you-always-withdraw-your-money-early-from-a-cd.html). Therefore, BestCashCow would not recommend general investment or savings strategies relying on early withdrawals from CDs.

Before investing in any CD, we highly recommend that you read our 65 questions to ask which is also available to download as an E-Book by clicking on the right column.

We also always recommend that you check rates at local banks and local credit unions before locking into online CDs; institiutions near you may offer better rates!

2.78% APY is an excellent rate on a 4-year CD. It is also an excellent rate on a 5-year CD. The 2.78% number is actually much higher than we have seen on a CD of that length in years, and higher than any nationally offered rate.

Community Trust Bank is offering the 2.78% APY rate on both the 4-year and the 5-year product at 6 of its branches in the Lexington, KY market. If you are lucky enough to live in that market, you have the opportunity to get into a rate that still is very hard to get in much of the rest of the country.

In fact, the rate is so much higher than those offered nationally, if I lived there I might just choose to opt for the 5-year product over the 4-year one, and be assured of locking into an extra year of interest at the 2.78% rate.

Community Trust is offering these products only at its 6 branches in Lexington, Kentucky - its Beaumont branch, its Hamburg branch, its Leestown branch, its Pasadena branch, its Richmond branch and its Vine Street branch. The rate requires a $1,000 minimum deposit and proof of residency in Fayette County.

You may be able to get a 4-year CD rate or a 5-year CD rate like this at a bank where you live! Check the best local 4-year CDs here. Check the best local 5-year CDs here.

Also see the best online 4-year CD rates here and the best 5-year CD rates here.