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Jumbo Savings Account Online

Jumbo CD is a type of savings certificate with a large deposit amount. It is a perfect savings alternative for investors with large cash holdings. An investor may deposit a minimum of $100,000 for a fixed period of time, typically 1 to 5 years, and in return is guaranteed an interest rate much higher than that offered by a traditional savings account. The advantage of a jumbo CD is its relatively low risk, negotiable feature and guaranteed return of the minimum funds invested.

Unlike small CDs with deposits lower than $100,000, jumbo certificate of deposit is a bit more risky. Typically, small CDs are insured by the Federal Deposit Insurance Corporation which guarantees protection for funds up to $100,000. As a jumbo CD may be far over than this amount, all extra funds are exposed to risk of loss. It is still a great investment tool if made with a reputable issuer. Apply for a jumbo CD online!
A jumbo CD works like a traditional certificate of deposit. The principle is tied up for a certain time period, bringing you a guaranteed return at a fixed or variable percentage rate set at the time of the certificate purchase.

The price for tying up your principle is higher than usual interest rate which may be locked in at a more favorable point. However, if the market prices improve, your interest rate will stay the same unless it is variable type.
Savvy investors prefer buying long-term jumbo CDs because the longer it takes the deposit to mature, the higher the return. If, say you were to choose between a six-month CD and a six-year CD, the second is more profitable for carrying a higher interest rate.

If you currently look to apply for a jumbo CD online, you need to know about the risks associated. Apart from no coverage for investment funds bigger than $100,000, you might face risk of extra charges and forfeiture of funds. Jumbo CD, just like a traditional CD, does not have the same liquidity as other savings accounts. It makes early withdrawal of the principle subject to penalty fees and even forfeiture of part of returns.
There are lots of nuances to consider. To ensure success, make certain you understand all terms and conditions properly.

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