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About Deposits
A deposit is the money you put in a bank in a checking or a savings account. If
you don't need all your money right away -- for example, you want to save some
money for retirement -- you may decide to put your money in a special kind of
bank deposit called a certificate of deposit (CD)
. When you buy a CD from your bank, you agree to keep your money in the bank
for a certain amount of time, generally six months to five years. The amount of
interest the bank will pay on your CD often depends on how long you agree to
keep your money at the bank. In most cases, the longer you keep your deposit at
the bank, the higher the rate of interest you earn.
The bank must give you your deposit back when you ask for it. Even if
you want to take your money out of a CD before it matures, you generally can
withdraw your money if you are willing to pay a penalty. If something happens
to the bank and it can't pay, your deposits in the bank generally are insured
by the U.S. government up to $100,000.
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