How to Invest in CDs, Money Markets & Savings Accounts

How to Invest in CDs, Money Markets & Savings Accounts

What Is a CD?

What Is a CD?

Comparing Savings Rates: APR and APY

Comparing Savings Rates: APR and APY

CD Early Withdrawals , Penalties and Maturity Options

CD Early Withdrawals , Penalties and Maturity Options

CD Laddering

CD Laddering

Savings - Compound Interest and the Rule of 72

Savings - Compound Interest and the Rule of 72

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Where to Open a Savings Account

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Auto Maintenance vs. Repair

How to Buy a New Car

How to Buy a New Car

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How to Plan for International Travel

How to Winterize a Car

How to Winterize a Car

How to Remove Snow from your Car

How to Remove Snow from your Car

How to Save for Retirement using IRAs

How to Save for Retirement using IRAs

How to Invest in CDs, Money Markets & Savings Accounts

How to Invest in CDs, Money Markets & Savings Accounts

How to Save Money

How to Save Money

How to Avoid Distracted Driving

How to Avoid Distracted Driving

Driving Emergencies

Driving Emergencies

Renting a Car - Getting the Most Out of Your Rental

Renting a Car - Getting the Most Out of Your Rental

Tips on Auto Batteries

Tips on Auto Batteries

Tips on Engine Fluids

Tips on Engine Fluids

Improving Gas Mileage When Driving

Improving Gas Mileage When Driving

Tips for Maintaining Vehicle Appearance

Tips for Maintaining Vehicle Appearance

Sudden Tire Blow-Out Safety

Sudden Tire Blow-Out Safety

Stop Texting And Save Lives

Stop Texting And Save Lives

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Common Car Care Tasks

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The Real Dangers Of Running Out of Gas

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Easy Tips To Improve Fuel Efficiency

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Safely Remove Snow From Your Car

Safely Remove Snow From Your Car

The Importance of a Written Financial Plan for Retirement

The Importance of a Written Financial Plan for Retirement

Investing the Right Way During Retirement

Investing the Right Way During Retirement

Avoid CD Investment For Retirement

Avoid CD Investment For Retirement

Systemic Withdrawal Plan For Retirement Investments

Systemic Withdrawal Plan For Retirement Investments

Creating A Plan For Retirement

Creating A Plan For Retirement

Understanding Health Care Costs During Retirement

Understanding Health Care Costs During Retirement

Refinancing A Mortgage Before Retirement

Refinancing A Mortgage Before Retirement

Evaluate Income Sources Before Retirement

Evaluate Income Sources Before Retirement

Annuitizing Income

Annuitizing Income

Financial Strategy For A Down Economy

Financial Strategy For A Down Economy

Investment For Beginners

Investment For Beginners

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Founded in 1902, AAA is a not-for-profit organization of clubs serving more than 51 million members in the United States and Canada. As North America's largest motoring and leisure travel organization, AAA provides its members a full range of travel, insurance, financial and automotive-related services through a network of 1,100 offices, as well as its full-service Web site: AAA.com. Since its founding, AAA has been an advocate for the motorist and traveler, continually lobbying for driver and passenger rights, fair laws and safer vehicles and roads. Through affiliations with motoring clubs around the world, AAA provides benefits to members traveling in 130 countries on six continents. Today, 25 percent of all U.S. households have a AAA membership. Nearly 27 percent of all North American passenger vehicles belong to AAA members.

What Is a CD?

Bill Gerhard: Hi! I am Bill Gerhard, Director of Financial Services for AAA. Today I am going to begin our discussion on how to invest CDs, Money Market and Savings Accounts by explaining what each one is.

What is a CD?

A CD is a time deposit account offered by banks and credit unions.

This expert: 515,699 views
This series: 31,756 views

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Transcripts

Bill Gerhard: Hi! I am Bill Gerhard, Director of Financial Services for AAA. Today I am going to begin our discussion on how to invest CDs, Money Market and Savings Accounts by explaining what each one is.

What is a CD?

A CD is a time deposit account offered by banks and credit unions. CDs are different from Savings Accounts because they have specific fixed term, typically 3 months to a long as 10 years.

CDs also usually have a fixed interest rate, the longer the term the higher the interest rate. Like Savings Accounts, CDs from banks are insured by the FDIC. CDs issued by credit unions are insured by the NCUSIF.

Both insure depositors up to $250,000 per category through December 31, 2013. CD terms and rates vary between providers but typically minimum deposit and may offer higher rates for larger deposits.

A CD will typically start earning interest from the date of deposit. The interest your CD accrues may be paid out as it accrues or may accumulate in the CD. You are probably familiar with Savings Accounts, you deposit money with the bank or credit union and get access to your money by writing checks or using a Debit/ATM card.

Another savings options is a Money Market deposit account which is a special type of savings account. A Money Market deposit account typically pays a higher interest rate than a Savings Account. You may be required to maintain a minimum balance in this account but you do have instant access to your money with no penalties.

However the number of payments to a third party is limited by Federal Law. I hope this is helped you begin to explore whether CDs, Savings Accounts, or Money Markets Accounts are right for you.

AAA offers the information in the video series for educational purposes only. Carefully consider objectives, risks, expenses and tax implications before investing. In our next video, I'll talk about Compounding Interest and explain comparing APR and APY.

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How to Winterize a Car

How to Winterize a Car

Winterize a Car - Brakes / ABS

Winterize a Car - Brakes / ABS

Winterize a Car - Engine & Fuel System

Winterize a Car - Engine & Fuel System

Winterize a Car - Exhaust & Fuel System

Winterize a Car - Exhaust & Fuel System

Winterize a Car - Heaters, Defrosters, Wipers

Winterize a Car - Heaters, Defrosters, Wipers

Winterize a Car - Cooling System

Winterize a Car - Cooling System

Winterize a Car - Battery

Winterize a Car - Battery

Winterize a Car - Tires

Winterize a Car - Tires

Winterize a Car - Preparing an Emergency Supply Kit

Winterize a Car - Preparing an Emergency Supply Kit

Winterize a Car - Surviving a Roadside Breakdown

Winterize a Car - Surviving a Roadside Breakdown