Creating a CD ladder is a smart way to simultaneously grow your savings while always having access to money from matured CDs. The key is to stagger your deposit across several months and years so there's always a CD hitting maturity and providing access to money, if you need it. If you...
If you bought a $1,000 face value CD that matured in nine months, and which was advertised as paying 9% annual interest, compounded monthly, how much would you receive when you cashed in your CD at maturity? Simone put 2500/- into...
Start to calculate the future value of a CD at a given point in time by taking the initial value of the CD as your starting balance. Multiply by the periodic interest rate (from Step 2) and add the result to the CD. For instance (continuing the example from Step 2), if the CD is...
To understand the idea of compound interest better, let's begin with a very simple example discussed at the beginning of this tutorial and write a formula to calculate annual compound interest in Excel. As you remember, you are investing $10 at the annual interest rate of 7% and want to k...
Risk is a fact of life for investors, and learning to manage risk is vital to a healthy investment portfolio. Even federally insured certificates of deposit have interest rate risk, meaning a rise in rates could leave you stuck with below-market earnings until the CD matures. Calculating risk...