What to do if your CD account matures this September

As September approaches, many individuals may be reminded of an important date related to their certificate of deposit (CD) accounts. If you opened a CD in the recent past, its maturity could fall within the month. Banks typically offer only a brief grace period of around two weeks for account holders to decide what to do with their matured funds before they roll over into a new account. Therefore, it is crucial to begin thinking about your next steps now, while you still have ample time to adjust your savings strategy.

However, simply moving your matured CD money into a traditional savings account may not be the most advantageous option. Currently, the average rate is a mere 0.38%, which fails to keep up with inflation. Moreover, there are high-rate account types that can provide significantly higher returns without restricting access to your funds, as CDs do. Thus, the question remains: where should you move your matured CD funds next?

There are two viable options to consider. First, a high-yield savings account offers a top rate of 4.10% at present. This type of account allows you to maintain access to your funds, unlike a CD. Although the account has a variable rate that may change with market conditions, it is less of a concern now that interest rates are stable and there is a possibility of rates rising later this year.

Nevertheless, not all high-yield savings accounts are the same, and online banks often provide more competitive rates than banks with physical branch locations. Therefore, it is essential to research and compare accounts and rates before making a decision.

The second option is a money market account, which offers slightly lower rates than the best high-yield savings accounts. However, money market accounts have the potential to adjust to market changes due to their variable rate. One significant difference between money market accounts and high-yield savings or CD accounts is that money market accounts also provide check-writing services.

If you seek to streamline your banking needs, earn a high rate in the current elevated rate environment, and retain access to your funds in case of an emergency, a money market account might be the right choice for you at this time. As with the high-yield savings account, it is crucial to shop around for rates and accounts before proceeding.

Online marketplaces now offer a convenient way to compare rates, terms, and banks in one easy-to-navigate location.