I have 2 CDs coming due soon, 1 in Sept and 1 in Oct.
Best rates are generally for 1 year, but found 5.75% for 2 years at State Farm Bank. Since the rates are lower, in general, for more than 1 year, does that mean that the banks are betting that interest rates will begin falling in the not too distant future - perhaps, when the Fed quits raising rates ? The banks don't want to give out a good rate for, say 3 to 5 years, knowing that rates are headed lower.
They want to suck you into a great rate for 1 year and then screw you when you renew.
.
ps: I know most of you out there don't use CDs, but I have a good reason for buying them at the moment. I'm seeking a guaranteed rate so that in about 2.5 years I can payoff the mortgage. No guarantees with the stock market. This is specifically allocated monies to be used for the mortgage payoff. So, at the end of the 2.5 years, my mortgage will be down to just about the value of the CDs.
Best rates are generally for 1 year, but found 5.75% for 2 years at State Farm Bank. Since the rates are lower, in general, for more than 1 year, does that mean that the banks are betting that interest rates will begin falling in the not too distant future - perhaps, when the Fed quits raising rates ? The banks don't want to give out a good rate for, say 3 to 5 years, knowing that rates are headed lower.
They want to suck you into a great rate for 1 year and then screw you when you renew.
.
ps: I know most of you out there don't use CDs, but I have a good reason for buying them at the moment. I'm seeking a guaranteed rate so that in about 2.5 years I can payoff the mortgage. No guarantees with the stock market. This is specifically allocated monies to be used for the mortgage payoff. So, at the end of the 2.5 years, my mortgage will be down to just about the value of the CDs.