Long-term savings goals-like retirement-aren’t, because you’ll miss out on bigger returns you can find elsewhere.
Short-term savings goals with a specific deadline, like a down payment or upcoming vacation, are good candidates for a CD. What are your financial goals? Your financial goals and their timelines should be the driving factor behind your savings strategy.That way, the money is there when you need it, and you won’t ever have to pay an early withdrawal penalty to access it. Generally, it makes sense to keep your emergency savings in a more accessible account-like a savings account-rather than a CD. Do you have plenty of emergency savings? If the answer is “no,” you may want to focus on that first.To figure out what makes sense for your situation, ask yourself the following: Like many financial questions, there’s no one right answer regarding how much you should keep in CDs.
