Some CDs do not have early withdrawal penalties. You can take funds out of a no-penalty CD at any time without paying additional charges. You might have to wait at least seven business days after opening the account, but the money is free and clear after that. No-penalty CDs offer flexibility, but you may pay a small price to keep your options open. These CDs typically pay lower rates than CDs that feature an early withdrawal penalty (all other things being equal). Still, a no-penalty CD might make sense if you’re setting aside funds for an unexpected need. Likewise, if you think rates might fall, you can use a no-penalty CD instead of a savings account. That strategy allows you to lock in today’s rates (for a while, at least) while keeping your money liquid.