Hey guys, quick question about CDs, can you add more money into them after you’ve opened one? I recently moved some leftover COVID money into an 18-month CD because the rates looked good. I’m wondering if I can deposit extra funds into it occasionally, or would I need to open a new CD each time? We’ve already got three months’ worth of expenses stashed away in a regular savings account as our backup emergency fund.
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Typically, no, you generally can’t add or withdraw funds from a CD once it’s set up, except during a brief window before its renewal date. After that period, any changes usually require waiting until the CD matures or facing penalties for early withdrawal.
There are some exceptions, though. Certain banks offer “add-on CDs” that allow you to deposit additional funds. It’s best to contact your bank directly to find out what options they provide.
If adding funds isn’t possible, you can always open a new CD alongside your existing one. There’s no limit to how many CDs you can have at once. Some people use a strategy called “CD laddering,” where they open CDs with staggered maturity dates, like one per year over several years, to ensure they have access to funds regularly without penalties. This strategy has gained traction again as interest rates rise after a period of low rates.
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During the grace period of a CD, typically around ten days after maturity, you can add or withdraw funds without penalties. Outside of this window, you would need to open a new CD if you wish to make changes.
In most cases, you can “add-on” or “add-to” your current CD account with additional funds. Even though the maturity date could be extended, money deposited beyond the initial CD will still accrue interest at the same rate. The date of the additional contribution will be used to compute interest on the new deposit. Note that adding money may affect early withdrawal policies; thus, confirm the exact guidelines of your bank. The flexibility to increase the value of your CD over time can be obtained by allowing additional deposits.
hi comrades lets talk.these accounts typically provide higher interest rates compared to conventional savings accounts and often offer greater flexibility for depositing or withdrawing funds.
money market accounts also come with check-writing capabilities and may feature tiered interest rates depending on your account balance.
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CDs have a fixed term, which can range from a few months to several years. During this term, the deposited funds cannot be withdrawn without incurring penalties, except in certain cases (like death or bankruptcy).