This CD Could Turn $1,000 Into $114,000. Here's Why I'd Still Stay Away

With savings account interest rates expected to take a dive later this year, certificates of deposit (CDs) are looking pretty good. They guarantee your interest rate for the full term, and they could earn you a pretty handsome profit, depending on your balance and the account you choose.

Most people think it's pretty good if they can earn a few hundred dollars from a CD, but I found one that blows that out of the water. It could turn your $1,000 initial deposit into more than $114,000 by the term's end. But you won't catch me opening one and here's why.

How long are you willing to wait for your cash?

Traditional CDs usually have terms between six months and five years, though it's possible to find terms as short as a few weeks or as long as a decade. But Walden Mutual Bank, based in Concord, New Hampshire, offers a jaw-dropping 100-year CD.

It has a 4.75% annual percentage yield (APY), which is about on par with the best CD rates from online banks today. If you invested the minimum $1,000 in the 100-Year Local Impact CD today, you'd have $114,505.60 by the time the term ends.

Our Picks for the Best High-Yield Savings Accounts of 2024

SoFi Checking and Savings APY up to 4.60% Rate info You can earn the maximum APY by having Direct Deposit (no minimum amount required) or by making $5,000 or more in Qualifying Deposits every 30 days. See SoFi Checking and Savings rate sheet at: https://www.sofi.com/legal/banking-rate-sheet. Min. to earn $0 Open Account for SoFi Checking and Savings Member FDIC.	APY up to 4.60% Rate info You can earn the maximum APY by having Direct Deposit (no minimum amount required) or by making $5,000 or more in Qualifying Deposits every 30 days. See SoFi Checking and Savings rate sheet at: https://www.sofi.com/legal/banking-rate-sheet.	Min. to earn $0
Synchrony Bank High Yield Savings APY 4.75% Rate info Our Disclosure: Annual Percentage Yields (APY) is subject to change at any time without notice. Offer applies to personal accounts only. Fees may reduce earnings. For High Yield Savings accounts, the rate may change after the account is opened. Visit synchronybank.com for current rates, terms and account requirements. Member FDIC Min. to earn $0 Open Account for Synchrony Bank High Yield Savings Member FDIC.	APY 4.75% Rate info Our Disclosure: Annual Percentage Yields (APY) is subject to change at any time without notice. Offer applies to personal accounts only. Fees may reduce earnings. For High Yield Savings accounts, the rate may change after the account is opened. Visit synchronybank.com for current rates, terms and account requirements. Member FDIC	Min. to earn $0
Capital One 360 Performance Savings APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening. Min. to earn $0 Open Account for Capital One 360 Performance Savings Member FDIC.	APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening.	Min. to earn $0

It's a pretty impressive profit. The only problem is, you probably won't be around to reap those rewards. Even Walden Mutual Bank itself acknowledges that this CD is best for those looking to do some charitable giving or to invest in a trust intended to benefit a future generation. 

But if it sounds like something you're interested in, just contact the bank. The minimum deposit is $1,000 and the maximum is $150,000. You can withdraw your interest payments at any time. But if you take your principal out before 10 years, you could lose part of it due to the CD's early withdrawal penalty.

Alternative accounts to consider

If you're not sure if the Walden Mutual Bank 100-Year Local Impact CD is the right fit for you, it's probably not. Consider putting your cash in one of these accounts instead.

A traditional CD

A traditional CD with terms between six months and five years enables you to grow your wealth and reap the rewards while you're still alive. Short-term CDs -- those with terms under one year -- have the highest interest rates right now, with some exceeding the 4.75% that Walden Mutual Bank is offering.

High-yield savings account

A high-yield savings account keeps your cash accessible and enables you to withdraw your funds at any time. The best savings accounts right now offer rates at or close to the Walden Mutual Bank 100-year CD. But savings account interest rates can fluctuate over time, so they could drop in the future.

Brokerage account

A brokerage account is a better home for most people's long-term savings. While Walden Mutual Bank's 4.75% APY is pretty competitive for a CD, the S&P 500 -- a popular stock market index -- sees about a 10% average annual return over the long run. That could grow your wealth a lot faster than a 100-year CD, and you'll still have the freedom to take your cash out whenever you'd like.

None of these are the get-rich-quick answer you might have been hoping for, but they're surer -- and faster -- ways to grow your wealth than waiting a century for your CD to mature. And if you're not comfortable putting all your eggs in one basket, consider spreading your cash between a few different accounts.