What Happens When Your Certificate of Deposit (CD) Matures?

Generally, a certificate of deposit (CD) comes with a built-in deadline. It’s the day your funds become available again, known as the CD maturity date. What happens on and after that date depends on the decisions you make, and sometimes how quickly you make them.

If you have a CD approaching its maturity date, now is a good time to get familiar with the process. Understanding your options ahead of time will help you choose the path that best fits what you need your money to do next.

Your CD Maturity Date: When Your Term Officially Ends

A certificate of deposit generally locks in your funds for a set term length, often for intervals like six months, one year, or five years, in exchange for a fixed Annual Percentage Yield (APY). Your CD maturity date is the day that term ends. Once you reach your maturity date, your original CD term ends. What happens next depends on your account terms and the instructions you provide.

You can usually find your CD maturity date on your original account disclosure, on a recent statement, or by logging into your online banking portal. If you’re not sure where to look, a quick call to your banker can confirm the date and walk you through the details of your account.

What Happens When a CD Matures: Understanding the Grace Period

Reaching your CD maturity date doesn’t necessarily mean you need to make an instant decision. Many banks build in a short window, often called a CD grace period, that gives you time to decide what to do with your funds without facing an early withdrawal penalty.

The exact length of a grace period varies by institution and account type, so you should be sure to check your account agreement or contact your banker to confirm how much time you have.

During this window, you can typically withdraw your funds, add to them, or let the account roll into its next term. If your CD renews into a new term after the grace period ends, withdrawing funds before the new maturity date may result in an early withdrawal penalty. Check your account terms to understand what applies to your CD.

Your Options at CD Maturity: Renew, Roll Over, or Withdraw

When your CD reaches maturity, you generally have three paths forward:

• Renew the CD. Your funds continue into a new term, sometimes at the same length and sometimes at a different one, based on current rates and what’s available at the time.
• Roll over into a different account. Rather than starting the same type of CD again, you move your funds into a different savings product, a different term length, or even a different institution.
• Withdraw your funds. You close out the CD and move the money into a checking or savings account, or put it toward whatever comes next, such as a down payment or another savings goal.

Some CDs are set up to renew automatically if no action is taken by the end of the grace period, while others require you to reach out and confirm what you’d like to happen. Your account disclosure will spell out which applies to you, so review it well before your maturity date arrives.

What Happens If Your CD Automatically Renews?

Some CDs automatically renew after the grace period if you don’t provide other instructions. The new CD may have a different APY or other terms than your original CD. Review your account disclosure and any maturity notices from your bank so you know whether your CD is set to renew and what action, if any, you need to take.

Questions to Ask Before Your CD Reaches Its Maturity Date

A little preparation ahead of your CD maturity date can make the decision easier when it arrives. Consider asking yourself:

• Do I need this money in the near future, or can I keep it in a CD for another term?
• Does the current rate environment make renewing at a new term worthwhile for me?
• Would a different savings product, such as a savings account or money market account, fit my goals better right now?
• What is my grace period, and what’s the deadline for deciding without a penalty?
• Is my CD set to renew automatically, or do I need to contact my bank directly?

Reviewing these questions a few weeks before your maturity date can help you avoid deciding under time pressure.

Key Takeaways

• Your CD maturity date marks the end of your term. That’s the point where your original rate and account terms stop applying.
• Many banks offer a short grace period after maturity, during which you can withdraw funds, add to them, or let the CD continue without an early withdrawal penalty.
• At maturity, your main options are to renew, roll over into a different account or term, or withdraw your funds.
• CD renewal and CD rollover are related but not identical. Confirm with your bank exactly what will happen with your account.
• Checking your account disclosure and reaching out to your banker before your maturity date helps you avoid automatic renewals or missed deadlines.

Planning Ahead for When Your CD Matures

A CD maturity date is essentially just a moment built into your account from the start that gives you a chance to reassess. For example, maybe your goals have changed since you opened the CD. Maybe rates have shifted, or you have a new use in mind for the funds.

Either way, knowing your grace period, understanding your renewal and rollover options, and asking a few good questions ahead of time puts you in a stronger position to decide.