Certificate of Deposit (CD)

Definition from Nolo’s Plain-English Law Dictionary

A document issued by a bank in return for a deposit of money. Interest rates on CDs are fixed, and usually higher than on savings accounts, because banking institutions require a commitment to leave the money on deposit for a fixed period of time. Often there is a financial penalty (fee) for cashing in a CD before the pledged time has run out.

Definition provided by Nolo’s Plain-English Law Dictionary.