Learning how to save your money is a smart decision. An easy way to save money is by putting it into a CD. However, you need to know how to get the best return for your money. Shopping around is important when trying to find the best rate. Here are three tips that will help you accomplish that financial goal.

Tip #1- Internet Banks Vs Brick-And-Mortar Banks Vs Credit Unions

Internet banks tend to give the best interest rates when it comes to CD’s. This is because they don’t have to deal with as many costs as a typical brick-and-mortar bank. The only downside is that you cannot talk to a person if you have an issue with your CD.

Credit unions may offer you the best rate if you are a member. However, you need to reside in the community where the credit union is located. Otherwise, you would need to be related to someone who is already a member. That could eliminate that option for you.

Brick-and-mortar banks may offer you good rates only if you have a large balance. You may also have to pay a penalty to have your money withdrawn early.

Tip #2- A Higher Balance Yields A Higher Interest Rate

Comparing CD interest rates can be a bit tricky, as the amount of your CD is partially how CD rates are determined (see this article at https://www.discover.com/online-banking/cd/How-are-CD-Interest-Rates-Determined.html for more information). Your interest rate increases as you put more money into the CD. Depositing $10,000 into the bank is going to earn more money as opposed to a deposit of $1,000. This is because you are tying up a larger portion of your assets for a long period of time.

Tip #3- Leaving Your Money In Longer Helps You Out

Most banks require you leave your money in the bank for at least 12 months. However, you could get a CD that matures in as little as six months. Leave your money in the bank for as long as possible. An 18 month CD will result in more interest for you as opposed to a six month CD. Interest will have longer to accrue on the balance if you don’t touch it.

The amount of interest your going to earn depends on many factors. The financial institution you choose, the amount of money you put in and the amount of time it has to gain interest all are important variables. Consider your options carefully before tying up your hard earned money.