 TITLE: What Are the Best Short-Term Investing Options? CONTENT: Certificate of Deposit (CD)\n---------------------------\nA CD is a savings account that holds a set amount of money for a period of time, such as six months, one year, five years or even 10 years. With a CD, a bank or credit union generally offers a higher APY than it would for a traditional savings account.\nWhen you cash in a CD, you get the money you originally deposited plus the interest you've accumulated. But if you pull out the money before the CD reaches what's known as the maturity date (such as one year from the time you deposited the money), you might be hit with a financial penalty. Many CDs require minimum deposits of $500 or more.\nThis investment option is best if you might need your money within the next two to five years.\nAs of October 2020, average APYs for CDs ranged from 0.27% for a one-year CD to 0.43% for a five-year CD. One of the highest rates was 1.5% for a five-year CD.\n*   **Risk level**: Low. The FDIC and NCUA typically insure CDs up to $250,000. However, you risk losing some of your money if you make a CD withdrawal before the maturity date.\n*   **Next step**: Investigate APYs, penalties and minimum deposit requirements for CDs. Banks that offer CDs include Ally, BankDirect, Capital One, CIT, Discover, Marcus by Goldman Sachs and Synchrony. END