Certificates Are Making a Comeback

Certificates Are Making a Comeback

The goal of saving money is to be prepared for life events. Now and again, even the most steadfast saver can succumb to the temptation of a growing savings account and make an unplanned purchase. We’re only human!

An easy solution to staying on track with your savings goals — and keeping temptation at bay — is investing your money in a federally insured certificate. While a certificate may sound like it’s more fitting for your grandparents’ generation, rising interest rates are breathing life back into its popularity.
Unlike a traditional savings account, a certificate is a vehicle to save your money for a predetermined amount of time at a usually higher, fixed rate of return. Most certificates will penalize you for early withdrawal, making the decision to hold onto your money that much easier.

With so many certificates to choose from, how do you know which is right for you? Here’s the Credit Union’s breakdown:
 
Premium Rate Certificate
This is your basic, no-frills certificate. Steadily earn interest in a term ranging from three to 60 months. Sometimes longer terms offer higher interest rates, though keep your eyes open for special rates on shorter terms. Minimum deposit amount is $1,000.

Add-On Premium Rate Certificate
Not only are you securely earning interest, here you have the ability to add funds to your original balance and increase your earnings. The minimum opening balance is $10,000, and you may add funds in increments of $1,000 or more without penalty or term extension. Available only in a 12-month term.

IRA & Deferred Compensation Certificate
Invest specifically in your retirement. The same rules govern this account as they do a traditional IRA or Deferred Compensation savings account, though you’ll likely earn a higher rate of return with a certificate. Minimum opening deposit is $1,000 with terms ranging from three to 60 months.

Opt-Up Premium Rate Certificate
When your rate is already locked in, the opt-up certificate provides an opportunity to increase your rate, in the event interest rates rise, once during the certificate term without penalty. Minimum opening deposit is $10,000. Available only in a 30-month term.
 
Explore all of our certificate terms and rates before you visit a Schools Financial branch to open your certificate.