visimoney
TLDR:
– Short-term CDs are currently offering higher interest rates than long-term CDs.
– The inverted yield curve, caused by the Federal Reserve’s rate hikes, has led to this unusual situation.
According to an article in Fortune, short-term CDs are currently offering higher rates than long-term CDs. This is a result of the inverted yield curve caused by the Federal Reserve’s rate hikes. The article explains that CDs, or certificates of deposit, are a popular option for individuals looking to save their money over a fixed period of time. By locking their money away in a CD, individuals can secure a fixed interest rate that is typically higher than those offered by regular savings or money market accounts. The article also highlights that online banks tend to offer better rates on CDs than traditional brick-and-mortar banks. However, consumers should be aware of the potential risks associated with short-term CDs, such as reinvestment risk. On the other hand, long-term CDs can be beneficial for individuals looking to save for specific financial goals, such as a down payment on a house. Ultimately, the choice between short-term and long-term CDs should be made based on an individual’s risk tolerance, time horizon, and liquidity needs.
