Updated: Nov 21
Is your capital locked in a CD (Certificate of Deposit)?
It's possible then, that your bank might not be paying you a fair rate.
When a CD matures, most banks will automatically roll the funds over into a new one.
With rates on the rise, some dishonest banks are however quietly placing their customers’ money into CDs with indefensibly tiny yields, then presumably keeping the extra profits for themselves.
Dan Jakobson commented;
"The bank automatically rolled my mom’s money into a one-year CD that yielded just 0.5%.
It wouldn’t be a stretch to call this a scam. You can get 8X that rate of interest in a simple savings account without locking your money up at all.
And one-year best CD rates are approaching 5%! That’s $5,000 in interest income a year… vs. the $500 the bank was trying to pay my mom.
The bank simply hopes its customers aren’t paying attention… and I’m sure many millions aren’t."
Any bank should be paying a minimum of 4% interest with current interest. Anything below that, investors should realize their are much strong options available. Always check the price of CD, and for the best priced CDs available on the market.