No. of Recommendations: 1
What do the more experienced fixed income investors on this board think of bump-up CD's? I have a CD maturing in a couple of weeks and had been hoping the May I-Bond rates would have been more competitive. Since they are not, I'm looking at alternatives. One is a credit union Share Certificate, 5 years, with a dividend rate of 4.89%/APY of 5%. It has a provision to bump the rate up to the then prevailing rate once during the 5 years. I live in a MD, a fairly high state income tax state (7.5%) and am in the 27.5% federal bracket. Given the alternatives these days, this doesn't look too bad. The 4.89% is more or less in line with other 5 year CD's and the bump-up provision sounds good. What have I missed?

Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.