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Whereas a savings account has minimal restrictions on in-branch withdrawals, the funds in a share certificate can’t be withdrawn without penalty until the maturity date.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 Forest Area Federal 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. At Forest Area Federal Credit Union, you can open a certificate with as little as [$XX] at an Annual Percentage Yield (APY) of [X.XX%] as of [##/##/##] [see website for current rates].
Certificate term lengths also vary among financial institutions, with most offering a choice of certificate terms ranging from three months to five years. At Forest Area Federal Credit Union, we offer our members certificates that can be opened for just [X] months, or as long as [X] years. Our dividend rates start at [X%]APY for short-term certificates and go up to [X%]APY for our long-term options.
Is a savings 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 Forest Area Federal Credit Union certificate insured by [the National Credit Union Administration] up to $250,000 [and independently insured up to $XXXX by XXXX], 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.
If a certificate sounds like the perfect choice for you, stop by Forest Area Federal Credit Union today to learn more. We’re committed to giving your money its best chance at growth.