Knowing the CD Account Fees on Early Withdrawal
One of the smartest moves to put money away at a fixed interest rate for a period of time specified by banks is through the CD or Certificate of Deposit Accounts. However, things happen and even for a large flourishing business, you will meet unexpected needs for money and the only option would be to withdraw your funds early than the state time.
Why should you pay CD account fees if you withdraw at an early date before maturity?
Certificates of Deposit is one of the ways for money safe keeping with a fixed Annual Percentage Yield or APY. Banks make sure that they have the funds needed for that specific term stated so that they can run their business but withdrawing early will disrupt the funds set for the term, which is why you need to pay an early withdrawal fee. There are two ways that you can prevent this from happening – either you avoid withdrawing the funds before its maturity or choose a risk-free CD, which generally has lower rates but you can withdraw anytime you want.