Question 1

What is a Certificate of Deposit (CD) account?

Accepted Answer

American Express Savings offers Certificate of Deposit (CD) accounts. These are accounts with fixed interest rates and different maturity terms to choose from. Funds cannot be withdrawn from the account prior to the maturity date without a penalty.

Question 2

What is the difference between a High Yield Savings Account and a Certificate of Deposit (CD)?

Accepted Answer

High Yield Savings Accounts are considered a liquid asset and offer a variable rate which can increase and decrease over time. Certificates of Deposits have a term and a maturity date that locks in the interest rate for the term. Also, there is an early withdrawal penalty to take funds out before maturity date.

Question 3

Can I add additional funds to a CD once it’s been opened?

Accepted Answer

The initial funding of a CD during opening is the primary way to add funds. However, you may add funds during the 10 calendar-day period (grace period) following the Maturity Date. At maturity, if your CD is set to automatically renew, there is a 10 calendar-day grace period during which you can add or withdraw funds from your CD account without penalty.

Question 4

What is a Maturity Date and what happens after that date?

Accepted Answer

The Maturity Date is the date your Certificate of Deposit ("CD") account is scheduled to be renewed or closed. A penalty may be imposed for a withdrawal of principal before the Maturity Date. Your CD will automatically renew on the Maturity Date, unless we are no longer offering a CD with the same term as your maturing CD or you have asked us to not automatically renew your maturing CD during the term of your CD. At maturity, if your maturing CD automatically renews, you will have a 10 calendar-day period (grace period) during which you can make a deposit or withdraw funds from your CD account without penalty. If you give us instructions prior to the Maturity Date to add or withdraw funds from your CD at maturity, your CD will be renewed on the Maturity Date and there will not be a grace period. You may prevent automatic renewal if you follow the steps online to change your maturity option, call us prior to the maturity date to change your maturity option, or if we receive written notice from you before the Maturity Date.
For more information on the terms and conditions of your CD, please see the Consumer Deposit Account Agreement and Savings Schedules. For additional terms and conditions, see "Truth-In-Savings disclosures", and “Automatic Renewal.

Question 5

Am I allowed a  partial withdrawal of funds from my CD?

Accepted Answer

American Express Savings does not allow partial withdrawals from our CD accounts. If you wish to make a withdrawal, you will be required to withdraw the full amount in your account and the account will be closed.

Question 6

What if I want to withdraw my funds from my Certificate of Deposit (CD) before the Maturity Date?

Accepted Answer

A penalty will be imposed if you withdraw principal from your CD before maturity, or if your CD is closed for any other reason before maturity. (In certain circumstances, such as the death or incompetence of an account holder, we may agree to waive the early withdrawal penalty.) You understand that, if the amount of the penalty is greater than the available interest earned or credited on your CD, we will deduct the difference from your principal.

For a CD with a Term of Less than 12 Months: If you withdraw all of your principal balance or if the account is closed for any other reason before maturity, the penalty is 90 days’ interest on the withdrawn amount applying the interest rate disclosed in your account-opening documents.

For a CD with a Term of at least 12 Months but Less than 48 Months: If you withdraw all of your principal balance or if the account is closed for any other reason before maturity, the penalty is 270 days’ interest on the withdrawn amount applying the interest rate disclosed in your account-opening documents.

For a CD with a Term of at least 48 Months but Less than 60 Months: If you withdraw all of your principal balance or if the account is closed for any other reason before maturity, the penalty is 365 days’ interest on the withdrawn amount applying the interest rate disclosed in your account-opening documents.

For a CD with a Term of 60 Months or more: If you withdraw all of your principal balance or if the account is closed for any other reason before maturity, the penalty is 540 days’ interest on the withdrawn amount applying the interest rate disclosed in your account-opening documents.

Note: If your CD was opened or last renewed before April 1, 2018, please see your original account disclosure for the penalty that will apply.

Question 7

How does the interest on a Certificate of Deposit (CD) compound, and can I choose to pay out the interest on a Certificate of Deposit (CD)?

Accepted Answer

Interest on all Savings accounts compounds daily and posts to the account monthly. You can choose to receive payments of interest from your Certificate of Deposit account. You can have the interest paid out to you via monthly transfer to your Savings account or linked external account. You can also choose to have the interest paid via check on a monthly, quarterly, or annual basis. If you choose to have interest paid out, instead of remaining in the account, it will affect the Annual Percentage Rate Earned (APYE) because the Annual Percentage Rate (APY) is calculated assuming the interest will remain on deposit.

Question 8

What is CD Laddering?

Accepted Answer

You are able to open multiple CD accounts with varying term lengths to take advantage of a CD laddering strategy. A CD ladder allows you to take advantage of the benefits of shorter-term CDs, while also having some funds earn predictable rates for longer terms.

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