Why Interest on CDs Can Drop to Near Zero

WSJ Your Money Briefing

The Wall Street Journal

News, Business News

3.8 • 1.6K Ratings

🗓️ 2 April 2024

⏱️ 8 minutes

🔗️ Recording | iTunes | RSS

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Summary

Some customers were surprised to see the high-yield interest rate on their CDs have fallen to a much lower rate than when they opened their accounts. Wall Street Journal personal-finance reporter Imani Moise joins host J.R. Whalen to discuss. Listening on Google Podcasts? Here's our guide for switching to a different podcast player. https://on.wsj.com/48YljZs Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Support for this show comes from SoFi Invest.
0:03.0	Alternative investments are now available on SoFi.
0:06.0	Unlocked the potential to build and protect your wealth,
0:09.0	with alt including real estate, venture capital, pre-IPO unicorns, and more at sofai.com slash W.S.J.
0:16.5	Alternative investment funds have unique risks, including the risk of loss, may charge high fees,
0:21.2	can be a liquid, and aren't suitable for all investors.
0:24.0	Investors should carefully consider the investment objectives, risks, charges, expenses,
0:28.1	and important information contained in a fund's prospectus prior to investing.
0:32.2	SoFi Securities LLC, FINRA SIPC.
0:36.0	Here's your money briefing for Tuesday April 2nd. I'm J.R. Wayland for the Wall Street Journal.
0:44.0	Americans have poured $2 trillion into certificates of deposit, or CDs,
0:52.0	over the past several years as interest rates continued to climb.
0:55.9	But some CD holders are surprised to see their investment is now earning a much lower rate
1:01.3	than when they first signed up.
1:03.0	Unlike a savings account, CDs have a due date.
1:05.7	They mature.
1:06.7	That means that a bank has to do something with that money
1:09.1	at the maturity date.
1:10.5	Sometimes they could put it into account
1:11.9	or write the account owner a check, but most of the time the default is that the CD will automatically renew into a new CD.
1:19.0	We'll talk to Wall Street Journal Personal Finance Reporter Amani Moise, after the break.
1:24.0	The less your business spends the more margin you keep.
	...

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