Benefits of Switching to Fixed-Rate CDs from High-Yield Savings Accounts
Why I'm Slowly Moving Money Out of My High-Yield Savings Account
High-yield savings accounts are awesome, but they don't have to be forever. Here's why one writer plans to move her money out soon.
Fixed vs. variable interest
I'm moving money out of a high-yield savings account because it has a variable interest rate and into certificate of deposits (CDs) because they have a fixed rate. This means I'm guaranteed a particular rate until my CD term expires.
A fixed interest rate remains the same for an agreed-upon period of time, while a variable rate can change at any given time. High-interest savings accounts almost always carry a variable interest rate.
High-yield accounts did (and still do) make sense
In 2022, the APYs on high-yield savings accounts hit record highs. Since then, it's made perfect sense to move money from our traditional savings and checking accounts to high-yield accounts. Earning money for doing nothing is one of my secret fantasies.
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This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.