CDs that won’t scare you

If you’re like me, some CD terms can be a bit scary. While above-average interest rates are great, commitment can be challenging. Sure, FDIC-insured CDs are low-risk investments, but what if you wind up unexpectedly needing that money? Most CDs will hit you with a hefty penalty if you withdraw your funds prior to their maturity, and you run the risk of forfeiting your interest, and in some cases, even part of your principal.

Some banks are changing their tune about strict terms, though. With bottom-of-the-barrel interest rates, they need to do something to entice you, and relaxing withdrawal fees can be especially appealing. From big banks to online banks, no-penalty CDs are popping up everywhere.

Here’s a rundown of three CDs that won’t strike fear into your finances.

Ally Bank’s No-Penalty CD: The online-only bank offers an 11-month CD with an interest rate of 0.95%. Need to remove some or all of your funds before the end of those 11 months? No problem – and there’s no minimum amount required to open the CD, either.

Bank of America’s Risk Free CD: This financial giant offers a certificate of deposit without the traditional penalty. Account holders earn 0.3% interest during the 9-month period and can remove their funds at any time. The catch: you need a minimum of $5,000 to open one.

TD Bank’s No-Catch CDs: The Northeast-based bank offers 6-month and 12-month CDs that give account holders the option to make one withdrawal without being subject to any penalty. While it’s called a “No-Catch” CD, there is one, of course. If you make more than one withdrawal, you’ll pay the fee. You also need $250 to open the account.

Depending on your investing objectives, these CDs may be your ticket to reaching your goal – and you won’t have to worry about paying penalties along the way.