A certificate of deposit is a timed deposit offered to consumers by banks, thrift institutions and credit unions. In exchange for keeping the money on deposit for the agreed term, usually 3 months, 6 months, 1 year, 2 years or 5 years, banks offer higher interest rates than they do then a traditional savings account, although this may not be the case in an inverted yield curve situation.

Fixed rates are the most common option, but some banks also offer CDs with various forms of variable rates. As of April 2008, current rates for a 6 month or 1 year certificate of deposit average between 2.5% to 3.0% annualized, rates on a 5 year certificate of deposit are over 3.00%.

All bank rates have decliend recently, mortgage rates have also come down to the six percent range for a conforming mortgage.