Two Months Ago I Bought A 1-Year CD Paying 1.35%; It Was a Mistake

Less than two months ago, I locked into a 1-year CD paying 1.35%. It was the best rate at the time and I really am unlikely to need the cash for the next 12 months (now 10 months). Nonetheless, I know now that I locked in too low.

The best nationally offered one-year CD rates are now paying close to 1.50%. One-year CD rates offered by banks or credit unions in your local area or state may even be paying higher. And, Ally Bank is offering an 11-month No Penalty CD that pays 1.50% on balances over $25,000. The Ally product gives depositors a much better rate than I am receiving and the ability to break the CD without an early withdrawal penalty.

But, I am not even so sure that I should have locked into a one-year CD at all. Savings rates are moving up quickly now with plenty of national offerings at 1.30%. Again, local rates at banks and credit unions that may be available to you may be even higher.

Since I might need the cash to take advantage of the stock market crash that may come when impeachment proceedings begin in the fall, I certainly now wish I had just foregone locking into a gain over cash of what now looks at best to be just a couple of dollars.

Did you know that at some banks it may not even be possible to redeem your CD early, even with the payment of early termination fees?

Before getting a CD read our 65 Questions to Ask before Choosing a CD which is also available as a e-book by clicking in the right column.