A Certificate of Deposit is a certificate which is issued by the bank to a person who deposits money for a particular span of time at a particular rate of interest. It is used in the banks of the United States and elsewhere.
A certificate is given someone as a souvenir or as written proof of doing something. Having a certificate of something is a sing that you completed this step to reach somewhere or to become something. It allows you to be called a certified person in that particular field for which you had the certificate. There are many types of certificate templates, such as a certificate of birth, death certificate, certificate of baptism, certificate of purity, etc.
Certificate Of Deposit Example
When a person deposits a certain amount of money in the bank, he is given this certificate with the interest rates decided. It is mostly cannot be changed later except in some cases it can be.
Certificate Of Deposit Definition
A person who deposits money is assumed to withdraw the money when it is matured. If the person withdraws deposited money before the maturity date then he shall be liable to some amount of penalty.
The maturity period of the deposit can vary according to your motive of the saving. Some people save money on an expensive trip after retirement. Some people save money for higher education. Some people save money for buying their dream home.
Certificate Of Deposit Pros And Cons
This certificate is a very smart way to save money for future use. It is better than investing money on bonds in the market as they don’t have any certain results. But with CDs, you will definitely get a particular amount of interest on your savings. It eliminates the guesswork and you know the exact results. It is the most secure way to invest your money. As there are advantages, disadvantages go side by side. You can not withdraw money anytime you need from this saving like other bonds. The very first in the list is that your money is stuck up with the CDs and you can not take it back until you the life of the certificate. Another thing is that you could miss some very good and profitable investments because your savings are on CD and you can not take the money out before the maturity period.
Certificates are generally non-negotiable, that is they cannot be transferred or shifted. But in some cases, the authority of the certificate can be transferred and those CDs are known are Negotiable CDs. You can know more about this certificate at bankingschool.co.in
How Does A CD Work
It is mainly used by investors because it is liquid and merchantable. The authority of these certificates can be shifted from one person to another. It is a very secure and risk-free way of investing money in the market. Its interest rates are higher than any other deposits in the market.
A certificate is a token of appreciation given to a person so that he can feel motivated about the work he had done. So if you are willing to provide someone a certificate then here we provide you certificate templates which can be used to give others the motivation and appreciation they deserve.
You can download these templates and use them digitally or you can also use the printable form. These are printable friendly so you can also print them and show them to other people.