As rates continue to increase, some customers threaten to leave for a better deposit rate at some other bank. It’s a scenario that many of you are familiar with.

But did you know that we can typically match any CD rate using a brokered CD?  

Brokered CDs are not a fit for everyone but could be a viable option to retain a customer.

What is a brokered CD? There are two types of CDs, a bank CD and a brokered CD. A bank CD is a certificate of deposit purchased directly from a bank, and the bank determines the interest rate. On the other hand, a brokered CD is a certificate of deposit purchased through a brokerage firm, like TRB Wealth. Instead of being issued by the bank, a brokered CD is issued by various financial institutions, and the market determines the interest rate.

Both bank CDs and brokered CDs are considered safe investments, as they are FDIC-insured. However, there are some key differences between the two. For one, bank CDs typically have a lower minimum deposit requirement, making them more accessible to a wider range of investors. Brokered CDs, on the other hand, may have a higher minimum deposit requirement and also require the assistance of an advisor to purchase.

Overall, both bank CDs and brokered CDs have their own advantages and disadvantages. Therefore, it’s essential to carefully consider the customer’s investment goals and risk tolerance before deciding which type of CD is right.  

The best course of action, should you encounter a customer leaving over rate, would be to refer them to a TRB Wealth Advisor. We’d love the opportunity to help your customer with their financial future.