Question

You decide to cash out your CD early. What will happen? A. You will be able to invest in other stocks. B. You will be penalized with high fees. C. You will roll it over into a 401(K). D. You will reinvest the proceeds into a money market account. E. You will have tax-free income.

Answer 1

The answer would be B.

Answer 2

Answer:

The correct answer is B.

Explanation:

Certificates of deposit, or CDs, are well known in the market because they are presented as protected investment devices.  

Penalties for early withdrawal of CDs result in interest losses. Depending on the status of your CD, you may have to pay a 30 to 90-day premium if you withdraw cash from a CD early. Longer investments have much more severe penalties.

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