What if a CDs rate drops before my deposit is made?

By Sabrina Karl

So you’ve done your research and identified the top-rate CD you want to open. You begin the process of opening the account, but then wonder, “What happens if the rate drops before my deposit posts?” Or, what if the rate goes up in a few days?


Unfortunately, there isn’t one answer. It depends on the bank or credit union where you’re opening the CD, and the day of the week — or even the time of day — that you’re starting the process.


What you can count on is that CD rates can change at any moment. The rate you see today might be higher or lower tomorrow. So here are a few tips on how to minimize your risks and lost opportunities.


First, check with the bank or credit union you’re considering. Many set your rate at the time of account opening, meaning if your deposit doesn’t post for 2-3 days, you still get the rate promised when opening the account.


In most cases, though, accounts are only opened on business days. So if you open your CD on the weekend or a holiday, or after hours, your account won’t open until the bank opens. And you’ll get the rate they offer at that time. So aim to lock in during bank hours.


Even better is when banks offer a rate guarantee. With a “10-day rate guarantee”, for instance, the bank will set your CD to the highest rate available during the 10 days after opening your account. If rates rise in a week, you get a better rate, while a rate drop won’t hurt you.


There’s no foolproof way to avoid all risk from CD rate fluctuations. At some point you just have to commit. But a little homework can improve your chances of scoring the best return.