A Certificate of Deposit (CD) is a promissory note that is issued by a certified bank. This note is like an investment, and also holds a rate of return. The longer the time duration of the maturity of the investment, the higher the rate of interest earned by you. The catch here is that a CD must not be cashed out earlier than the maturity period, and doing so usually leads to a fine being charged to the client. The idea here is to allow the CD to reach its full potential and then the investment holder can reap its benefits.