Did you know that your savings portfolio should be diversified just like your investments? Financial experts recommend giving your savings as much chance as growth as possible. Let’s take a look at an especially great choice for diversifying your savings: a share certificate.
What is a share savings certificate?
A share certificate is an insured savings account with a fixed dividend rate and a fixed date of maturity as well. The funds in these accounts will grow at a dividend rate that is usually higher than those on typical share savings accounts, and some money market accounts.
How is a share certificate different from a savings account?
There are several differences between a share certificate and a savings account, but the main one is the accessibility. Whereas a savings account has minimal restrictions on in-branch withdrawals, the funds in a share certificate can’t be withdrawn without penalty until the maturity date.
Terms and conditions of certificates
As a member of Achieve Financial Credit Union, you can open up a certificate today. However, there are some basic requirements. These include having a minimum opening balance and committing to keeping your money in the account for a set amount of time.
Certificate term lengths also vary among financial institutions, with most offering a choice of certificate terms ranging from three months to five years. At Achieve Financial Credit Union, we offer our members certificates that can be opened for just 6 months, or as long as 5 years. Our dividend rates start at 3.56% APY* for short-term certificates and go up to 3.05% APY* for our long-term options.
Is a share certificate for everyone?
While keeping your savings in a certificate can be an excellent way to diversify your savings, it’s not for everyone. Only go ahead with your decision to open a share certificate if you are fairly certain you will not need to access these funds before the maturity date.
What are the advantages of diversifying your savings through a share certificate?
Here are some of the most popular reasons people choose to open a certificate:
- Low risk. With each Achieve Financial Credit Union certificate insured by the National Credit Union Administration up to $250,000, you can rest easy, knowing your money’s safe.
- Higher dividend rates. Certificates offer all the security of savings accounts, but with higher yields.
- Locked-in rates. The APY of your certificate is set when you open it and is locked in until its maturity date.
Think a certificate might be the right fit for your savings goals? Visit Achieve Financial Credit Union today to learn how we can help your money grow with confidence.
Prefer a personal touch? We’d love to assist you—call us at 860.828.2790 or schedule an appointment at our Meriden or New Britain branch.