discover bank cd rates

Planning For The Future: Discover Bank CD Rates And Benefits  

Marcus Marion, CMA™ 8 months ago 0 19

Did you know Discover Bank has some of the most alluring offers on the financial market? This online bank has something for every potential saver, including money market accounts. If you’re interested in a certificate of deposit (CD), the digital financial institution offers competitive rates. And its requirements are friendlier than those of several other banks.   

CDs are a savings product that requires you to invest a lump sum for a specified period upon which the money will earn interest. It’s advisable to keep only the cash you don’t need because early withdrawal could attract a penalty, or you could lose your interest. Still, most people prefer CDs to a typical savings account because of their better rates. 

If you’re considering Discover Bank CDs, we’ve written this blog with you in mind. We’ll delve into everything about these savings accounts, including Discover Bank CD interest rates and why they may be a good investment for the future. Let’s get started!  

Current CD Rates at Discover at Discover Bank  

According to USA Today, these are discover bank CD rates as of September 21, 2023:  

CD Term Annual Percentage Yield (APY) percentage  
3 months 2.00 
6 months 3.40 
9 months  3.50 
12 months  5.00 
18 months  5.00 
24 months  4.30 
48 months  4.00 
120 months  3.80 

How Discover Bank CD Rates Work  

 

Bank CD Rates Work

As you’ve seen above, longer CD terms attract higher APYs. But regardless of the CD term you choose, you must deposit a minimum of $2,500 to open your account at Discover. Unfortunately, this threshold is high compared to a few other banks. On the upside, the financial institution’s CD rates are better.  

It’s advisable to understand how competitive rates from Discover Bank work before opening your CD. Typically, these rates are fixed for all terms ranging from as little as 3 months to 10 years. This guarantees you returns upon the maturity of your specified term.  

Withdrawing Money Before Your CD’s Maturity 

 With Discover, you’re free to withdraw interest before maturity. However, that lowers the amount you’ll get at your CD’s end. Regrettably, that’s not the case when you withdraw your initial deposit amount, as the bank will penalize you. Usually, the penalty is a certain percentage of the interest your money has accrued, and it varies from one term to another.  

For example, for terms less than 12 months, CD owners lose up to 3 months’ interest. For periods between 7 and 10 years, the amount is much higher as it equates to 24 months’ worth of interest.  

Early withdrawal can considerably reduce your potential earnings at the end of your CD. Therefore, we recommend that you avoid it since you might be unable to meet your financial goals.  

Opening a Discover CD   

Follow these steps to open a certificate of deposit at Discover Bank:  

  • Visit the Discover website  
  • Hit the “Open an Account” button and choose the “New to Discover” option if it’s your first time creating an account at the digital bank. Customers with an account should go for the “Already a Discover Customer” alternative and log in.  
  • Provide your details. These include your name, address, birth date, employment status, and social security number or taxpayer ID. 
  • Select the CD you’d like to open and the deposit amount.  
  • Wait for your application’s approval. 
fund

Discover allows you to fund your CD at the time of application or later. If you choose the former, you can initiate an internal transfer where you move the money from your Discover bank account. Alternatively, you can use ACH to transfer the $2,500 or more from an external account.  

However, if you select the fund later option, you have more ways to fund your CD. These include an internal transfer, which you can initiate by messaging or calling the bank. You can also mail them a check and include your CD account number (regrettably, transfer checks are unacceptable).   

At the initial funding stage, Discover allows phone transfers. Again, you can fund your Discover CD through a wire transfer. Afterward, your certificate of deposit is all set and you will start earning interest. Usually, the latter is compounded daily. And then credited to your account monthly.  

Withdrawing Money From Your CD at Maturity  

About a month before your CD matures, Discover will alert you. You can either reinvest your cash into another certificate of deposit of a similar or different term or withdraw it. Thankfully, you don’t have to make this decision immediately.  

The digital bank gives customers a 9-day grace period to decide. However, if you don’t do it by the end of that duration, it automatically puts your money into another CD of the same term.  

Benefits of a Discover Certificate of Deposit 

Deposit

Now you know Discover Bank’s term deposit rates, how they work, and the process to open an account and withdraw money. Let’s discuss the advantages of a CD at this online bank.  

  • No Fees  

You don’t need to pay a dime to open or maintain Discover CDs.This only means you may have more to invest. Even so, keep in mind owners must pay $30 to wire money to external bank accounts.  

  • Mobile Account Access 

As a Discover customer, you can use the bank’s mobile app to access your CD. Fortunately, the app is built for both Android and iOS devices.  

With mobile account access, you can check your CD whenever you want, regardless of location. This gives you peace of mind as you’ll know your money is safe.  

Moreover, with the Discover mobile app, you can confirm successful transfers, whether you’re making them from your Discover account or an external one.  

  • Competitive Rates 

Another advantage of choosing Discover CDs over others is the competitive rates. This means you could earn more money at the end of your term, making them the perfect place to park your savings.  

  • Many Term Lengths  

A vast majority of people like Discover CDs because they’re not limited to one or a few terms. Instead, they have 12 options, ranging from 3 to 120 months. If you only want to lock your money for a few months, the three or six-month terms perfectly suit you. On the other hand, the bank also offers longer terms with more attractive rates, such as the 7 and 10-year terms.  

What’s even more convenient is that you can create various CDs. For example, you can choose multiple IRA CDs; Discover Bank IRA CD rates are among the best.  

Who Should Open a Discover CD?   

This is probably your first question before opening a CD at Discover Bank. Well, here’s the answer—anyone with at least $2,500 to set aside for a specific duration can create a CD.  

Your CD can help you meet both short-term and long-term financial goals. For instance, it can help you save for big purchases like luxury kitchen appliances. It might also be useful if you want to make a downpayment on your dream home. 

But remember, a CD can’t be an emergency fund because the bank doesn’t allow you to withdraw your money before maturity.  

More Discover Bank Products 

banking

What are your options if you’re looking to explore other banking alternatives, such as more offers from Discover? Read on to find out.  

  • Online Savings Account  

The Discover online savings account is a good option for paying zero fees. Because it has no minimum balance requirement, you can deposit any amount. Furthermore, you can manage your account from anywhere and enjoy the bank’s reliable customer service.  

  • Money Market Account  

Discovering high-interest-rate money market accounts allows you to plan for your future. Like the bank’s savings accounts, they don’t come with fees, and customers don’t need to maintain a minimum balance. Even so, the minimum deposit amount is $2,500, which may be too high for some investors.  

  • Discover Checking Accounts  

Discover’s cashback debit account enables you to receive your paycheck up to 48 hours early. Additionally, you don’t need to pay monthly service fees to maintain these accounts, adding to their convenience. Then, your debit card allows you to access up to a whopping 60,000 ATM locations, enabling you to use your money wherever and whenever you want.  

Notably, Discover also provides its customers with credit cards and loans. Its app is among the best banking apps with a referral bonus, meaning you can earn a few extra bucks when your referrals are approved.   

If you’re wondering, “Is banking a good career?” it can be with Discover. The online bank lists its open roles on its website, including the specific requirements for applicants.  

Summary  

Knowing the Discover Bank certificate of deposit rates can give you a head start as you prepare to grow your earnings. While some terms last only a few months, others allow you to invest your money for seven or ten years.  

Be sure to consider your financial needs or goals before choosing the correct term. And don’t forget that withdrawing your money before the CD matures is not an option unless you’re ready to pay a penalty or lose interest.  

The good thing is if you follow all the required guidelines, Discover Bank’s high-yield CD rates can improve your finances in the future. It’s advisable to seek the services of an experienced financial analyst or investment banker.  

These individuals know a lot about investing and hold some of the highest-paying bank jobs. With their advice and guidance, you might be able to make the most out of the financial market. Still, don’t throw caution out the window. All investments come with some risk.  

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