If you're considering a CD but you're concerned about being locked into a CD in today's low-rate environment, you might want to look into flexible CDs. One bank that's offering a flexible CD is First Green Bank in Central Florida. It's advertising a 24-month Flex CD with a 1.10% APY. The CD has three flexible features:
- add-on: make additional deposits up to one-half the initial principal balance
- withdrawal from: one withdrawal up to one-half the initial principal balance without penalty during the original term
- increase rate: increase the rate one time during the term if the bank's rate increases
Minimum deposit is $1,000, and the maximum is $250,000 per account. New money is required. This is a limited-time promotion. It's listed in the bank's promotion page as of 2/25/2013.
It appears that a branch visit is required to open the CD. First Green Bank branches are located in Orlando, Ormond Beach, Mount Dora and Clermont. The branches in Orlando and Ormond Beach were just opened in 2012.
The bank has an overall health score at DepositAccounts.com of 5 stars (out of 5). Please refer to our financial overview of First Green Bank for more details. The bank has been a FDIC member since 2009 (FDIC Certificate # 58874).
How This CD Compares - Evaluating Flexible CDs
If you don't care about the flex features, you can get a much higher 2-year CD rate. The best deal that's available nationwide is 1.60% APY at Pentagon Federal Credit Union.
One internet bank that offers a 2-year flex CD is CIT Bank. It's called the Achiever CD, and it has a 1.20% APY. Its two flex features are a one-time additional deposit of any size and a one-time rate bump. Unlike First Green Bank, it doesn't have any early withdrawal feature. On the plus side, there's no limit on the additional deposit.
How useful are these flex features? If you're concerned about being locked into a low-rate CD as rates sharply rise, the penalty-free early withdrawal feature can be valuable. However, First Green Bank's Flex CD allows a penalty-free withdrawal of only half the initial principal. So that limits the flexibility.
Both First Green Bank and CIT Bank's CDs allow one rate bump. Ally Bank also has flexible CDs called Raise Your Rate CDs. Its 2-year RYR CD allows for one rate bump, and it currently has a 1.09% APY.
The rate-bump feature can also be useful when rates rise. However, one thing could make it useless. If the bank doesn't keep its rates competitive as rates rise, you may never get a chance to bump-up the rate.
The above rates are accurate as of 2/25/2013.
Searching for the Best CD Rates
To search for nationwide CD rates and CD rates in your state, please refer to the best CD rates section of DepositAccounts.com.