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Simple, Safe & Stable: The Three Qualities That Make Certificates Of Deposit Great

  • January 27, 2023
  • 4 min read
Simple, Safe & Stable: The Three Qualities That Make Certificates Of Deposit Great

Let’s be honest; the number of people who are willing to take on extreme risks on their investments makes up only the minority. Most of us would want to keep our investments simple, safe, and stable. After all, no one wants to see their hard-earned cash get taken away from them by mere playing with chances. This is why many people turn to low-risk investments. 

One of the typical choices for those who are looking for low-risk investments is a certificate of deposit (CD). If you’re currently in the market for investing in CDs, be sure to check out CIT Bank CD rates. As of now, CIT Bank is among the few select banks that are offering zero fees for early withdrawal of deposits. This means that you can freely recover the entire amount of your investment without the fear of losing value on your principal. In this article, we are going to talk all about CDs. Specifically, we are going to talk about the three qualities that make CDs a great, well-rounded investment product.


The first quality that makes CDs great is that they are very simple. The entire process can be summed up into three basic steps: 1) deposit, 2) wait, and 3) collect. This makes CDs more investor-friendly because they do not require too much time, effort, and attention to maintain. 

In stark contrast, other types of investments like shares of stocks or cryptocurrency would have to be monitored on a constant basis just to make sure that you are earning. The complexity of setting up and maintaining the investment is a huge factor for people, and it also acts as a barrier to entry. Knowing that CDs are quite simple, a lot of people have started investing in these types of products, which led to the development of the CD market overall. In turn, this only created better opportunities for both banks and investors.


CDs are considered low-risk investments, which means that they are very safe. The maximum interest rate when it comes to CD investments typically ranges from 4 to 5 percent only. This means that the potential for earning returns is quite low. However, this is complemented by the other qualities of a CD investment, which makes income earnings a lot more regular and predictable. On top of all this, CD investments are also insured by the Federal Deposit Insurance Corporation (FDIC), which means that it is fully backed by the United States government. The FDIC insures up to $250,000 per depositor per bank for CD investments. Ultimately, this serves as a solid incentive for investors to continue their investment, and it provides them a chance to gain more from their investment.


The market rates for CDs are typically set by the banks or the credit unions themselves. As such, you could expect that the rates are going to be far from being random and all over the place. This is best manifested in the fact that the interest rates of different banks only vary in the slightest degree, with most banks competing at the decimals. All this allows for a high degree of stability in the entire CD market. This is perhaps the highlight of a CD investment because it allows for the creation and implementation of long-term investment plans. 

Essentially, because CD investments are inherently low-risk and are considerably more stable, people are keener to invest in CDs for the long term. This is due to the fact that they have more confidence that the investment will earn no matter what happens. Even if the interest income they earn each year is only marginal, it all eventually adds up.

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