Tuesday, 16 July 2019

Review of Edward Jones CD Rates

Review of Edward Jones CD Rates
12 Jul
10:39

Edward Jones’s Most Popular Accounts

APY

Account Type

Account Name

Compare Rates from Similar Accounts

1.95%

CD Rates

Edward Jones 1 Year CD

2.50%

Goldman Sachs Bank USA High-yield 12 Month CD

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

2.30%

CD Rates

Edward Jones 5 Year CD

2.80%

Goldman Sachs Bank USA High-yield 5 Year CD

LEARN MORE Secured

on Goldman Sachs Bank USA’s secure website

Member FDIC

What are brokered CDs?

Edward Jones offers brokered CDs, which are a bit different from the standard bank-issued CDs that most investors are familiar with. Bank-issued CDs, as the name implies, are issued by individual banks for their customers. Since Edward Jones is a broker and not a bank, it cannot issue its own CDs. Instead, the firm offers a range of CDs issued by other banks and thrifts but sold via Edward Jones.

For the casual investor, it can be hard at first glance to tell the difference between bank-issued and brokered CDs. However, there are some important distinctions:

  • No early withdrawal penalties: Brokered CDs don’t have early withdrawal penalties. If you need to get out of your CD, you can usually sell it back to another investor through a brokerage firm. This means that brokered CDs carry some additional risk, as the price of these CDs may fluctuate on the open market.
  • Higher APYs: You can often get higher yields on a brokered CD than with a bank-issued CD. Brokers are able to negotiate higher CD rates since they can guarantee a large pool of buyers to CD issuers. In the era of online banking, however, even brokered CDs do not always garner the absolute highest rates.
  • Longer-term options: Brokered CDs often have longer-term options than are available with traditional bank-issued CDs, which are generally short-term investments only.
magnifying glass

How do CD rates from Edward Jones compare?

Edward Jones CD rates are well above the national average, but they still fall considerably short when compared with the best available rates nationwide.

Unlike with many firms, Edward Jones doesn’t currently have any special-rate CDs, where certain maturities pay dramatically higher rates. Instead, rates at Edward Jones land along a traditional curve, gradually increasing in yield as maturities lengthen.

For example, as of July 3, 2019, the Edward Jones 2-year CD rate of 2.05% is far below the best available 2-year CD rates. Three-year CD rates top out nationally at 3.00%, but Edward Jones pays 2.15%. The pattern continues throughout the maturity curve, with the top 5-year CD rates nationally hitting 3.00% or more, while the 5-year at Edward Jones pays 2.30%.

As such, all rates at Edward Jones fall in the general area of being well-above national averages but still notably short of the best available rates.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

John Csiszar

John Csiszar |

John Csiszar is a writer at MagnifyMoney. You can email John here

TAGS:

Recommended by

This Cash Back Number May Surprise You

This Cash Back Number May Surprise You

Best Travel Credit Cards With No Annual Fee

Best Travel Credit Cards With No Annual Fee

Getting Approved For 1 Of These Credit Cards Means You Have Excellent Credit

Getting Approved For 1 Of These Credit Cards Means You Have Excellent Credit

Credit Cards Charging 0% Interest until 2021

Credit Cards Charging 0% Interest until 2021

Source: https://www.magnifymoney.com/blog/reviews/edward-jones-cd-rates/

« »

Szemere

Related Articles