CDs are a special type of deposit account that offers a safe, long-term way to grow your money.
So long as you open your CD at an FDIC insured bank, the CD will never lose value. That means that you can know exactly how much money you’ll receive from the CD.
In exchange for offering a guarantee for how long you’ll leave your money in a CD, banks will offer you an interest rate higher than you can get from a savings account.
This increased interest rate and level of security make CDs attractive to many consumers.
In this Citizens Access Bank CD Account review, we'll compare rates, fees, and services to other national and online banks.
Top-Notch CD Rates
A CD is a special bank account that lets you earn interest on your savings.
In fact, the interest that you can earn is possibly the most important part of a CD. That makes the rate that a bank is willing to pay important to consider when you’re comparing different banks’ CDs.
If you can earn more interest by opening a CD at a different bank, why wouldn’t you?
Citizens Access Bank is an online bank, and online banks tend to offer more interest than brick and mortar banks do.
Online banks are much cheaper to run than traditional banks. They don’t need to worry about operating ATM networks or paying the costs of opening and running bank branches. That means they can spend more money on paying interest.
That lower operating cost gives Citizens Access Bank a leg-up on the competition. In fact, even among online banks, Citizens One Bank’s CDs offer interest rates that are very good.
Many banks will change the interest rate that you can earn based on the amount of money you’ve deposited to your CD. Citizens Access Bank doesn’t make you deal with different rate tiers.
You will earn the same interest rate regardless of how much you deposit to the account.
What does affect the interest rate you’ll earn is the CD’s term. The longer you plan to keep your CD for, the more interest you will earn.
Early Withdrawal Penalties
CDs differ from savings accounts in one key.
When you open a CD, you’re making a commitment that you won’t withdraw your deposit for a specific period of time. This is known as the CD’s term.
So, if you open a CD with a term of 12 months, you’re promising not to withdraw that money for 12 months.
Citizens Access Bank offers CDs with terms of:
- 6 months
- 12 months
- 18 months
- 2 years
- 3 years
- 4 years
- 5 years
This variety of terms makes it easy to choose a CD with a term that works for you. Don’t forget that CDs with longer terms offer higher interest rates.
While you may be tempted to open a 4-year CD to get the highest rate available, there is a downside.
Remember that you promise that you won’t withdraw your money for the full term of the CD. If you break that promise, there are penalties. These penalties are calculated based on how much interest you earn each month.
If you have a CD with a term of 12 months or less, the early withdrawal fee will be 90 days of interest.
If the term is longer than 12 months, the charge is 180 days of interest.
This charge is based on the original term of the CD, not the remaining term.
One special feature offered by Citizens Access Bank is the option to have interest deposited to a linked account.
Usually, the interest a CD earns is added to the CD. That interest compounds, but remains unavailable until the CD matures.
Citizens Access Bank allows you to have the money transferred to a linked account. That means you can spend the interest as you earn it if you want to.
Minimum Deposit Requirements
Many banks force customers to deposit a certain amount of money if they want to open a CD.
CDs can be more expensive to open and manage from the bank’s perspective, so the bank wants to make sure the amount you deposit justifies its effort.
Unfortunately, the means that many people struggle with opening CDs. If they can’t get enough money together to meet the minimum deposit requirement, they can never open the account.
Citizens Access Bank does have a hefty minimum deposit requirement. You won’t be allowed to open a CD with a deposit of less than $5,000. If you can meet that minimum, you can deposit as much as you’d like.
Keep in mind that CDs are insured by the Federal Deposit Insurance Corporation, but that the insurance isn’t unlimited. The FDIC insured CD balances up to a maximum of $250,00 per account ownership type at the bank
Not IRA CDs
Individual Retirement Accounts (IRAs) offer a number of tax benefits for people who want to save for retirement.
Traditional IRAs let you deduct contributions from your income taxes and Roth IRAs let you avoid paying taxes on your gains. Either type of account is a good vehicle for long-term savings.
Some people like to open CDs in IRAs. They like the idea of a secure, long-term investment, and want to combine that with the tax benefits offered by IRAs. That makes IRA CDs quite popular, especially among people nearing retirement.
Unfortunately, Citizens Access Bank does not offer IRA CDs. You’ll need to open a CD at another bank if you want to open a CD in an IRA.
What Happens When the CD Matures?
When the term of a CD ends, the CD is said to have matured. At that point, you are allowed to make changes without paying an early withdrawal fee.
Opening a CD is a long-term commitment. You’re committed to every aspect of it: the amount you deposited, the term, and the interest rate.
Because you’re locked in for the full term of the CD, you should keep close track of when your CDs mature.
If you don’t do anything when your CD matures, most banks will automatically roll your balance into a new CD.
The new CD’s term will be the same as the original CD’s, and the interest rate will be whatever the market rate is.
Shortly before your CD matures, the bank will notify you of this fact. Still, you should keep track of your CDs’ maturity dates so you can take your time to plan.
At Citizens Access Bank, there is a 10-day grace period when your CD matures.
Starting on the day your CD matures, and for 10 days after, you can make changes to the CD without penalty.
That means that you can withdraw or add money, or change the term of your new CD.
Once you make a change, the new CD’s terms will be locked in. If you want to make further changes or make no changes before the 10-day period ends, you’ll have to pay an early withdrawal fee.
How Does It Compare?
Citizens Access Bank offers some fantastic CDs if you can meet the minimum deposit requirement.
You’ll earn a great rate of interest, regardless of the term that you choose, but getting $5,000 together to open the account may be hard.
If you want to shop around and look at other CDs, compare the following factors.
Start by looking at the CDs’ interest rates. You want to know that you’re earning the most interest possible.
All else being equal, choose the CD with the highest rate. Settling for a lower rate is like giving up free money.
Next, look at the CD terms the bank offers. You want to find a bank that offers CDs with a term that works for you.
Some banks specialize in short-term CDs while others offer CDs with incredibly long terms.
The bank you choose can be based on how long you want to keep your savings committed for.
Don’t forget that you’re committed to the interest rate of your CD for the CD’s full term.
If you think rates will rise, you might want to opt for a short-term CD. If you think they might fall, a long-term CD may be better.
Finally, consider each bank’s policy regarding maturing CDs.
You want to make sure you have a long enough grace period to make changes to your CDs.
If a bank doesn’t offer notice of a CD maturing or has a very short grace period, you’ll have to be even more diligent about keeping records.
Citizens Access Bank offers great CDs for people who can manage to make the hefty $5,000 minimum deposit.
The flexible CD terms mean you can easily find a term that is right for you.
The biggest downside is that you cannot open a Citizens Access Bank CD in an IRA, making it a non-option for people trying to save for retirement.