"The Championship is a great league and this move will help me do that.
"I thoroughly enjoyed my time at Cardiff. I would tell any player thinking about joining Cardiff to snap their hand off.
"It's a great club, with fantastic fans and an excellent manager."
Kennedy started his career at Millwall before Roy Evans brought him to Anfield in a £1.5m move in 1995.
He made just 16 league appearances for the Reds however and three years later joined Wimbledon, where he also struggled to get first-team games.
A switch to Manchester City a year later was more successful, but the full-back is more renowned for his five-year spell at Wolves where he played 187 games.
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