Can You Add Money To A CD? (Certificate Of Deposit)
Yes, you can add money to a add-on CD, however you won’t be able to add on to a fixed CD. How does an add on CD work? It works exactly like you think it would. It gives you the ability to add more money to your current CD. While it is true that adding more money will help you make more, you need to realize that the interest rate is going to remain the same. There may be certain requirements that need to be met in advance though. For instance, a lot of issuers will force you to make a minimum additional deposit of at least $500.
However, there are some cases in which you will not be able to add money to a CD. This is typically true for those who have purchased a fixed CD. This means that it is a fixed purchase. You’re paying a specific amount and will receive a specific amount in return. It is fixed and you most likely will not be able to add money to the CD in the future. In order to add money to the CD, it needs to be a flexible CD in the first place.
Many people are unaware of the numerous ways that they can make money from their bank. Opening and utilizing a bank certificate of deposit account is one of the best ways to do just that. This will provide you with a higher interest rate, but there is one minor drawback. You will not be able to access your money for a certain period. If you choose the amount wisely, there is a good chance that you won’t need that money anyway. Instead, you’ll be able to sit back and reap the rewards while the money accumulates.
Now that you’ve confirmed that you can add money to your certificate of deposit, you should find out how the process works. You’ll be able to do just that in the guide below.
How Do I Add Money To A CD?
Before doing anything, you should go over the terms and conditions of your certificate of deposit. By reading the fine print, you will be able to determine whether or not you can actually add money to your CD. Remember that you need a flexible CD. If you want to add money to your CD in the future, you should definitely stick with a flexible CD. If you are stuck with a fixed CD, you can still continue investing in CDs. All you have to do is save your money and purchase a new CD. Some banks allow consumers to open a CD without being required to meet a minimum balance requirement.
This can also help you obtain better interest rates. If you want to add the money to an existing CD, you will need to take advantage of an add-on CD. This will make it possible for you to add more money to the account. You will most likely need to visit your bank to make this happen. This is a good option for people who have a goal in mind. For instance, if you’re trying to save for the down payment of a home, adding money with an add-on CD is recommended. This can help you avoid spending the money on something else.
The only problem here is that the add-on CD is not going to help you acquire better interest rates. If you’re going to be stuck with the same interest rate that you received in the beginning. You should also realize that you’ll need to keep the money in the CD account until the term expires.
You might be able to withdraw the money early but doing so is going to result in you losing all of the interest earned over the years. If you haven’t earned enough interest, you may even put the principal at risk.
Either way, using an add-on CD is the easiest way to add money to your existing CD. However, it might be best to purchase a new CD.
Banks That Offer Add On CD’s
Unfortunately, many banks do not want to deal with add-on CDs. They would prefer people to start new. This can make it very difficult for you to find banks that are offering what you need. Still, there are a few that will cooperate. The First Tennessee Bank is one of the banks that offers this type of feature. In order to open your account, you will need to make an initial deposit of $500 or more. After that, buying an add-on CD will be much less expensive.
In fact, you can add as little as $25 to your CD at one time. The FDIC insured account even comes with a free withdrawal every six months. This means that you can make one withdrawal without facing penalties every six months. This is really one of the more generous CD accounts you could own.
If you’re looking for an alternative, you can always try BB&T. Unfortunately, this bank is stricter when it comes to CDs and add-on CDs.
Some of their personal CD packages do not allow you to use add on CDs. Instead, you will need to make the upgrade to the Can’t Lose CD. To open this type of CD account, you will need at least $1,000 for the initial deposit. After that, things are going to be much worse. After the first 12 months of the term, you will be able to make an additional deposit. You can deposit as much as $10,000.
The good news is that BB&T does provide a free withdrawal after the first 12 months of the term. With the Can’t Lose CD package, you will be looking at a 30-month term. You can also take advantage of the Stepper Rate CD from BB&T. This is slightly better for people who intend to keep their money in their CD for a much longer period. The term is 48 months.
You can make one additional deposit up to $10,000 each year. After 24 months, you will be able to make withdrawals without penalties.