BANKING AFFAIRS

Detailed explanation-1: -Nearly every bank charges an early withdrawal penalty to customers who want to take money out of their CD before its maturity date. These penalties can vary, but are usually expressed as the interest the CD would have earned over a certain period.

Detailed explanation-2: -It depends on the terms of your account. Federal law sets a minimum penalty on early withdrawals from CDs, but there is no maximum penalty. If you withdraw money within the first six days after deposit, the penalty is at least seven days’ simple interest.

Detailed explanation-3: -If you withdraw money from the CD before the term is over, you’re breaking the promise you made to keep your money in the account. For breaking that promise, you usually have to pay a fee called an early withdrawal penalty.

Detailed explanation-4: -What is a mature CD’s grace period? A grace period is a short window of time, generally one to two weeks, when you can withdraw the money in your CD without paying an early withdrawal penalty. A grace period starts the day after a CD’s maturity date, which is the final day of a CD’s term.