I’m Opening My Very First CD After Age 40. Here’s Why

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I am not a young buck, that’s for sure. And yet, even so, I recently opened my very first CD. You might be wondering, “Why would someone over 40, in their prime earning years, open a CD instead of putting money into higher-yield investments?” It’s a good question, and I have some good answers.Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes. For me, it really comes down to financial security, interest rates, and the balance a CD brings to my portfolio. Let me explain why it makes sense for me, and why it might for you too.CDs offer stability and predictabilityWhen I recently went over my current portfolio with my financial advisor, we saw that most of my investments were tied to the stock market. And while they have been good to me, and still have growth potential, growth potential equals risk. And financial risk is something that interests me less and less as I have gotten older.CDs, on the other hand, are nearly risk free. They are FDIC insured, and offer a predictable, stable return over a set period of time, usually three months to five years (these days, shorter-term CD interest rates hover around 4.5%).Given that, having a portion of my money in a low-risk vehicle like a CD feels like a smart move. Indeed, for risk-averse folks like my wife and I, CDs are actually pretty appealing.Interested in CDs? Click here for the best CD rates available today.CDs are a good place to park extra cashIt is always a good idea to have an emergency fund. In my case, my emergency fund consists of six months’ worth of living expenses. My wife and I keep that money in a regular savings account, earning regular (read: little) interest. Because CDs require that you lock up money for a set period of time, they are not a good place for emergency funds.But what they are good for is as a place to keep cash beyond your regular savings amount and emergency fund because you will earn more interest on your money there. The interest rate you earn on a CD is fixed for the term, meaning it won’t fluctuate the way a savings account APY does. That was another selling point for us.A CD rounds out my portfolioI was more aggressive with my investment portfolio when I was younger, but not now. At this stage, my main goal is to build a well-rounded, balanced portfolio, and that means both growth and security. While I love my IRA, CDs give me more security as they are not tied to the market. Fixed terms and interest rates higher than traditional savings accounts mean I am still growing that money, albeit more slowly, but also with less worry.A tax-advantaged retirement account is a great way to grow your money for your golden years — check out our picks for the best IRAs.So yes, we have some very good reasons for opening a CD after the age of 40. While it might not seem like the obvious choice, if you are looking for balance, financial security, and predictability, opening a CD just may make sense for you, too.Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes. We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.”}]] [[{“value”:”

I am not a young buck, that’s for sure. And yet, even so, I recently opened my very first CD. You might be wondering, “Why would someone over 40, in their prime earning years, open a CD instead of putting money into higher-yield investments?” It’s a good question, and I have some good answers.

Alert: highest cash back card we’ve seen now has 0% intro APR into 2026

This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to read our full review for free and apply in just 2 minutes.

For me, it really comes down to financial security, interest rates, and the balance a CD brings to my portfolio. Let me explain why it makes sense for me, and why it might for you too.

CDs offer stability and predictability

When I recently went over my current portfolio with my financial advisor, we saw that most of my investments were tied to the stock market. And while they have been good to me, and still have growth potential, growth potential equals risk. And financial risk is something that interests me less and less as I have gotten older.

CDs, on the other hand, are nearly risk free. They are FDIC insured, and offer a predictable, stable return over a set period of time, usually three months to five years (these days, shorter-term CD interest rates hover around 4.5%).

Given that, having a portion of my money in a low-risk vehicle like a CD feels like a smart move. Indeed, for risk-averse folks like my wife and I, CDs are actually pretty appealing.

Interested in CDs? Click here for the best CD rates available today.

CDs are a good place to park extra cash

It is always a good idea to have an emergency fund. In my case, my emergency fund consists of six months’ worth of living expenses. My wife and I keep that money in a regular savings account, earning regular (read: little) interest. Because CDs require that you lock up money for a set period of time, they are not a good place for emergency funds.

But what they are good for is as a place to keep cash beyond your regular savings amount and emergency fund because you will earn more interest on your money there. The interest rate you earn on a CD is fixed for the term, meaning it won’t fluctuate the way a savings account APY does. That was another selling point for us.

A CD rounds out my portfolio

I was more aggressive with my investment portfolio when I was younger, but not now. At this stage, my main goal is to build a well-rounded, balanced portfolio, and that means both growth and security. While I love my IRA, CDs give me more security as they are not tied to the market. Fixed terms and interest rates higher than traditional savings accounts mean I am still growing that money, albeit more slowly, but also with less worry.

A tax-advantaged retirement account is a great way to grow your money for your golden years — check out our picks for the best IRAs.

So yes, we have some very good reasons for opening a CD after the age of 40. While it might not seem like the obvious choice, if you are looking for balance, financial security, and predictability, opening a CD just may make sense for you, too.

Alert: highest cash back card we’ve seen now has 0% intro APR into 2026

This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to read our full review for free and apply in just 2 minutes.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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