CDs May Still Hold Value in 2025 for Conservative Investors
Certificates of deposit (CD) offer predictable returns and are a popular choice for interest-bearing accounts. With guaranteed rates during the term, they provide consistent gains regardless of market fluctuations. However, early withdrawal penalties apply if funds are taken out before maturity.
Experts say CDs will likely remain a good investment in 2025 under certain conditions, such as needing to keep money accessible with limited risk. Domenick D’Andrea, co-founder of DanDarah Wealth Management, notes that CDs have been used in conservative portfolios to build future needs.
Chad Gammon, CFP, agrees that CDs will be a worthwhile investment for those seeking low-risk options, but consumers may need to shop around more for special offers. With potential rate cuts, CDs offer the benefit of locking in today’s rates before yields fall further.
Jeff DeLarme, CFA, CFP President at DeLarme Wealth Management, advises clients to find a comfortable rate and lock it in, as renewing CDs at competitive rates may become challenging. However, he suggests considering alternative investments like money market accounts, Treasury bills, or I Bonds for those seeking low-risk options.
Ultimately, the decision to open a CD in 2025 depends on individual risk tolerance and investing timelines. If you’re willing to shop around and lock in competitive rates, you’ll likely find suitable certificates of deposit that fit within your diversified portfolio.
Source: https://www.cbsnews.com/news/will-cds-still-be-worth-opening-in-2025-heres-what-experts-believe