If you are looking for a long term investment where you can save your money for a substantial amount of time and accumulate interest, then you should ask your bank for a certificate of deposit account. This account is similar to a savings account but it has a specific fixed term of anything from three months to five years.

CD’s, as they are also referred to, can be used if you are putting away your extra cash for your child’s education, your retirement, or just to earn money off the interest. With a certificate of deposit you will not usually get a piece of paper but there will be a book entry and it will show up on your monthly bank statements.

The interest rates for CD’s can vary depending on the bank, the amount of money you are investing and the length of the term. You will get higher interest rates if you invest with a smaller bank, and if your term is a long one because you are showing good faith in that specific financial institution.

Most CD accounts offer a fixed interest rate so that you can rest assured that you will not lose any money if the market rate falls. Some accounts do however vary and some interest rates are linked to bonds and indices on the stock exchange. You can choose when you want to withdraw your money from the CD account. There is no risk in keeping it in the account for the full term, but if however you have to draw it out prior to the end of the term; you will be penalized in the form of extra payments.

A certificate of deposit account is something to look into to make sure you are saving money for your future, and because the interest rates are usually fixed and higher than an ordinary savings account, you will accumulate a large sum of money over a long period of time.