A certificate of deposit is a common savings vehicle for someone who wants minimal risk compared to stocks or other investment accounts. You must choose a bank to open the account, select a CD option, deposit your cash and wait until the account expires. The common next action is to withdraw or cash in the money from the same bank, but if you’ve moved and no longer have access to a branch you might wonder if you can retrieve the funds from a different bank instead.
Certificate of Deposit
A certificate of deposit is a safe and simple way to save your money. You receive a modest interest rate on your deposit in exchange for agreeing to keep the funds in your account for a set period of time, such as six, 12 or 36 months. The rates commonly exceed that of a standard savings account. However, if you take the money out of the account before the account period expires you may have to pay an expensive penalty fee.
Cashing It In
At maturity, which is the date of CD expiration, the bank releases the money (principal deposited, plus interest earned) in the certificate of deposit account to your possession. You can either take the cash or roll it over into another CD account. The bank either takes instructions to transfer the funds to another linked account, asks you to come in for a withdrawal or sends a check in the mail.
It is usually not possible to close a CD at a different bank from the one where it matured. You must cash it in at the bank of origin, just as you would any other type of bank account. Bring your account number, name and identification. If you want the funds back as cash it is important to act immediately. In some cases, the bank automatically rolls the funds over into a new CD account.
Though you cannot cash the funds at another bank, it is sometimes possible to transfer the funds to a new account at another bank. Request a wire transfer. Provide the bank where the CD account is located with the account number, name and routing information of the new bank. Be prepared to pay an expensive fee for this service — as much as $25 per transfer.
Louise Balle has been writing Web articles since 2004, covering everything from business promotion to topics on beauty. Her work can be found on various websites. She has a small-business background and experience as a layout and graphics designer for Web and book projects.