How to Use Kansas City CD Rates to Your Advantage
In an uncertain economy and eventual retirement down the line, Kansas City CD rates continue to be a favored option for conservative investors interested in growing their money beyond what a savings account can offer.
How Kansas CDs Work
The growing popularity of CDs has opened the door to a few unconventional CD types, but standard CDs follow a unifying principle that is straightforward and gains decent returns.
The general idea behind a CD involves you (the depositor) lending a financial institution (bank or credit union) a pre-determined amount of money for a fixed period of time.
During that time, your principal earns interest. After the term is up, you’ll have the option of rolling your principal and earned interest into another fixed term to continue growing, or withdraw your money to do as you please.
The concept is simple enough, but with the range of CD account types at your disposal, it’s necessary to assess what it is that you want to achieve with a CD. In other words, what do you want to do with your funds once the account matures?
Short-Term or Long-Term Kansas City CD Rates
Banks and credit unions often provide options for how long you can lock a deposit into CD. Common term tiers include 6-months, 12-months and 24-months. The term duration you choose should be dependent on how soon you’d like to access your funds, as CDs typically apply penalties for early withdrawals.
For example, if you cannot afford to set aside your deposit for too long due to financial obligations, you may benefit from a shorter term. Your deposit may not grow as much interest, but avoiding penalty fees is justification in itself.
Choosing the Best Kansas City CD Rates
Some institutions offer a flat interest rate regardless of the term duration you’ve chosen. However, a majority present high-yield Kansas CD rates for longer terms as incentive for depositors. The most impressive rates are usually associated with the longest terms.