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First Merchants Bank Emergency Savings Fund Photo

How to Build an Emergency Savings Fund: Step 5

Once you have saved enough to cover six months of expenses and have extra cash, you might consider investing the additional funds. You can boost your returns on any excess money with a certificate of deposit, or CD. A CD is a savings instrument offered by banks and credit unions that has a fixed date of maturity and a fixed interest rate. Most CDs require a minimum deposit amount and may offer rates contingent on the size of the deposit. The interest you earn on your deposit depends on the interest rate, the term of the deposit and the compounding method.