CD Replacement

Federal Funds interest rates between 0-0.25% make CDs a lower return investment. You may want to consider an alternative that may help protect your family.

In response to the COVID-19 pandemic, the Federal Reserve slashed interest rates down to between 0-0.25% in March of 2020. This had a significant affect on CD rates as the year progressed. Typically, CDs are used for a person’s “conservative investment”. The interest they pay usually require a sacrifice of liquidity. The longer the lockup term, the higher the rate. Typical terms are one, three, and five years. There are alternatives to buy CD’s that may be appropriate.


Certain insurance companies develop policies to compete against CDs by offering the benefits of a life insurance policy along with some of the benefits of a CD. These policies are paid for with a single premium (one-time payment) that is fully liquid and may be accessible on day one. The cash in the policies may be 100% protected against loss and the policies may offer limited stock market participation every year. In addition to these security and growth benefits, they may offer a death benefit that is larger than the single premium paid (size determined by age, health and rider availability), and the ability to accelerate this death benefit to pay for the cost of chronic illness care should the need arise.

We believe this type of strategy can offer more growth and better liquidity than a CD.


Thornwood works closely with several of the top rated (AAA) companies and we are familiar with the application process. With the due diligence and individual attention provided by our Thornwood Financial team, we have seen applications submitted and approval granted quickly.

As of April 2022.

Statements concerning financial market trends are based on current market conditions, which will fluctuate. Past performance is not a guarantee of future results.

Guarantees are based on the claims-paying ability of the individual Insurance Company and assume compliance with the product’s benefit rules, as applicable.

Because investor situations and objectives vary this information is not intended to indicate suitability or a recommendation for any individual investor.