Credit Union CD Rates: High-Yield Investment Options
When you’re planning to put money away for a long period of time, you may want to consider a certificate of deposit (CD). These savings vehicles are contracts in which you agree to commit to leave your funds at the bank or credit union for a certain length of time. In return for this commitment, the bank or Credit Union CD Rates promises to pay you a fixed rate of interest or other returns.
Fortunately, some credit unions have higher rates on CDs than traditional banks do. This is because credit unions are nonprofit organizations that operate for their members’ benefit. They also don’t pay federal income tax, which makes them more likely to have extra resources for offering higher rates.
A 1-Year CD: 1.53 percent APY
For investors who aren’t comfortable with a long-term savings plan, a one-year credit union certificate of deposit (CD) might be a great choice. These types of CDs offer a guaranteed fixed interest rate over the life of the certificate, which is typically between 12 months and five years.
You can open a credit union CD with as little as $500, so you can start small and build up your savings to reach financial goals. These certificates are also a good way to ladder your investments, so you’re earning more on older deposits than younger ones.
Some credit unions, such as All In and Bethpage FCU, even have “bump-up” CDs that allow you to increase your interest by adding additional money during the term. If you’re considering a bump-up CD, make sure to look at the term length and annual percentage yield (APY), as well as the fees that may apply.
These credit unions also have online and mobile banking options, as well as other services that you can use to manage your account. These include checking and savings accounts, and a wide range of loans.
CDs from credit unions are usually insured by the National Credit Union Administration, which protects deposits up to $250,000 from losses caused by the bank or credit union. In addition, these CDs tend to have fewer early-withdrawal penalties than bank CDs.
Credit Union CDs are a good way to save up for an emergency or other big purchases. They also can be a great way to save for retirement.
When shopping for CDs, look for rates that are competitive with the competition and term lengths that align with your financial goals. Keep in mind that some credit unions do charge a fee for early withdrawals, so check the fine print before you sign up.
Share Certificates: 2.31 percent APY
When you’re saving for a large purchase, such as a house or a car, a certificate of deposit from a credit union can be a good choice. These certificates are similar to bank certificates of deposit, but they also earn dividends. These shares are protected by federal law and by NCUA insurance, so you can be assured your money is safe.