How To Save Using Certificates Of Deposit

If you are motivated to save money for the long-run, a certificate of deposit or CD may be the right account for you. Understanding CDs and how they work can help you get into the right saving habit. With banks like columbia bank colonia, etc., you can begin to include savings as a positive habit.

The concept behind a CD is simple. You have to deposit a given amount into the account and leave it there for a specified period. Over the specified time, the money that you have deposited will begin to earn interest. Read ahead to understand CD better.

Certificates of Deposit and maturity

You will have to wait for the CD to mature. It means that the specified period has ended. You have two options before you once the CD reaches maturity. You can go ahead and withdraw the initial deposit and the interest earned.

The other option is to continue earning interest on your initial deposit and the interest you have earned. To do this, you can roll the CD over and take it into a new CD account with a new specified term.

Columbia Bank
800 Inman Ave, Colonia
NJ 07067, United States
Phone: +1 732-381-1717

How Does a CD work

The interest rate for the CD that you have chosen will generally be given before you deposit the money. This will continue for the specified period. The longer the term, the higher the interest rate is likely to be.

If you choose to withdraw your money from the CD before it reaches its maturity, you may have to pay the penalty. A CD may be a good choice as it is safe and generally offers a higher interest rate than a Savings Account.


Using a CD for saving is an ideal way to ensure that you are not tempted to use your savings. Since your deposit earns interest, you will also be able to earn from your saved money.