A CD, or certificate of deposit, is a type of savings account that offers a higher interest rate than a traditional savings account. In order to prevent people from withdrawing their money before the CD matures, most banks charge a penalty for early withdrawal.

The penalty for withdrawing money from a CD before it matures varies from bank to bank. Some banks may charge a percentage of the amount withdrawn, while others may charge a flat fee. The penalty may also be based on the length of the CD. For example, a bank may charge a penalty of $25 for …