Experts highlight risks of opening CDs with online banks

Online banks often offer higher interest rates on certificates of deposit (CDs) compared to traditional banks. However, potential risks include the lack of federal insurance and cybersecurity threats. Customers should ensure their chosen bank is insured and has strong security measures. Another concern is customer service. Online banks typically provide limited support options, such as phone or chat, rather than in-person assistance. It's important for customers to choose a bank that aligns with their preferred support style. Overall, both online and traditional banks can be viable options for CDs. Consumers are encouraged to compare rates and services before making a decision.