What Is the Difference Between an IRA & CD?

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The difference between an IRA and a CD is that an IRA is not an investment, but a vehicle that investments can be placed in to. Find out how a CD can exist inside an IRA with help from a licensed insurance agent in this free video on retirement planning and personal finance.

Part of the Video Series: Retirement Planning
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Video Transcript

Hi, my name is Bill Rae. I'm a licensed agent and I've been in the finance field well over two decades. And the question is, what's the difference between an IRA and a CD. Excellent question. Let's remember that an IRA is not actually an investment. An IRA is actually a vehicle that you can put investments in to. Interestingly enough, a CD which is commonly called a certificate of deposit, can be inside an IRA. So, very simply put, what's the difference between an IRA and a CD? Well a CD is an investment that a bank will give you a certain amount of money for holding your money for a certain period of time. An IRA is a vehicle that you can put other types of investments in. So one actually is an investment if you will, the other is the vehicle and one can be in the other. My name is Bill Rae and I'm helping you build wealth.

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