How to Find IRA CD Rates

An IRA, individual retirement account is a personal, tax-deferred account for employed people and their spouses. You can set up an IRA at any bank, mutual fund, brokerage company or insurance company. There are many investment options to choose from, and you pay taxes only as earnings are paid out of your account. Many people invest in both types of IRA's, the Roth and the traditional.

Difficulty: Moderate

Instructions

1. Determine which type of IRA is best for you. There is no age limit to contributing to a Roth IRA, but you may not participate in a traditional IRA once you reach the age of 70.5.

2. Consider your income when determining eligibility. Income caps do not apply to traditional IRA contributions. Check the Roth IRA income cap limitations since they change from one year to the next.

3. Think about the tax treatment of IRA distributions before making your decision. Roth IRA distributions are tax and penalty-free, while traditional IRA distributions are ordinary income and may be subject to income taxes. Early distribution penalties may occur for taxpayer under the age of 59.5.

4. Schedule an appointment with your representative or financial adviser to setup or renew your IRA CD with the highest CD interest rate. Visit your bank or lending institution online to view their current CD interest rates.

5. Use a CD calculator to find out how much interest you can earn on a Certificate of Deposit. Examine the benefits of investing in a series of CD's with different maturities, a product known as a "CD Ladder." With a ladder, you may benefit from higher interest rates, longer maturities and better liquidity than you'll find in a single, long-term CD.

Resources

• Visit Bankrate.com to use the CD calculator.