My CD Just Matured. Now What?

CDs are sort of like a revolving door. You open one and tie up your money for a period, but eventually, that money is yours to reclaim once your CD matures.

If you have a CD that just came due, you may be wondering what to do with the money. With CD rates being high right now, opening another CD may be tempting. 

But should you commit to opening another CD? Or is there a better choice? Ask yourself these questions to find out.

1. Do I have a complete emergency fund outside of my CD?

Since life can be frustratingly expensive out of the blue, and you never know when a surprise home repair or medical bill might arise, it’s important to have a fully loaded emergency fund at all times. At a minimum, you should aim for three months of living expenses in savings, as that amount could get you through a period of unemployment. 

Our Picks for the Best High-Yield Savings Accounts of 2024


up to 4.60%

Rate info

Circle with letter I in it.

You can earn the maximum APY by having Direct Deposit (no minimum amount required) or by making $5,000 or more in Qualifying Deposits every 30 days. See SoFi Checking and Savings rate sheet at:

Min. to earn


Min. to earn




Rate info

Circle with letter I in it.

4.25% annual percentage yield as of June 7, 2024

Min. to earn


Maybe you had a complete emergency fund before opening your last CD, only a few months ago, you had to take a withdrawal for a surprise expense. If so, you may want to put the money from your recently matured CD into a regular savings account.

2. Do I have any large expenses coming up?

Maybe you’ve been hoping to buy some new furniture or take a big trip to celebrate getting your master’s degree. Or maybe you’re expecting to have to replace your water heater in the coming months. 

If you have a large expense coming up soon, whether for a happy reason or not, then you generally don’t want to commit your money to a CD. There can be costly penalties for cashing out a CD before it matures, so a savings account is a better place for money you might need within a year.

3. Am I trying to save for a goal that’s not too far away?

If you’re saving for a goal that’s pretty far out — say, 10 years away or more — then investing in stocks is generally a smarter move. While many CDs are paying around 5% today, the stock market’s average annual return over the past 50 years has been 10%. 

This means that if you have $5,000 you’re investing for a milestone that’s 20 years away, putting it into stocks could grow that sum into about $33,600 (past results do not guarantee future returns). Even if you were to earn 5% in a CD every year for the next 20, that would only turn your $5,000 into about $13,300.

However, if you’re saving for a goal that’s a couple years away or a bit more, investing in stocks isn’t the best idea. You may not have enough time to ride out an extended stock market slump if you’re saving for a home renovation you want to do in three or four years. 

In that case, a CD could be a great bet. But you may want to favor a longer-term CD, even if it means not getting the best rate available today. 

The Federal Reserve is expected to start cutting interest rates at some point this year. Once that happens, CD rates are likely to fall. And while they may not fall so dramatically, if a 36-, 48-, or 60-month CD aligns with your timeline, you may want to choose a CD with one of these terms.

It’s important to think carefully about what you want to do with a CD that’s just matured. Consider all of these points when making your choice. 

These savings accounts are FDIC insured and could earn you 11x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts could earn you 11x the national average savings account rate. Click here to uncover the best-in-class accounts that landed a spot on our short list of the best savings accounts for 2024.

Source link

About The Author

Scroll to Top