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A certificate of deposit (CD) is a safe investment made to a bank or broker, earning interest over a set period. CDs offer higher interest rates than savings accounts but require the money to be kept for the CD term. The main difference from savings accounts is the inability to withdraw funds without penalty from a CD. CDs come in various lengths and rates, with terms and fees differing. Most CDs are issued by banks or brokerages, with bank CDs typically being FDIC-insured up to a certain amount, ensuring government protection against loss.
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