Share Certificate accounts offer the best of both worlds when it comes to your savings. You’ll be giving your money a great chance at growth without subjecting it to the risks of investing in the stock market.
Let’s take a closer look at how certificates work and why they might be the perfect choice for you.
What is a certificate?
A certificate is an insured savings account with a fixed dividend rate and a fixed maturity date. Rates tend to be higher than those of savings accounts. Also, unlike a savings account, your money will be less accessible than when in a certificate. That means you will not be able to withdraw your funds before the maturity date without paying a penalty.
If you need more flexibility, check out our Flex Certificates.
Terms and conditions of certificates
There are some nominal requirements that must be met before you can open a certificate.
First, you’ll need a minimum deposit amount. This amount will vary widely from one financial institution to the next. In general, the more money you park in a certificate, the higher rate of interest it will earn. At MCCU, you can open a certificate with as little as $1,000.
Second, you’ll need to commit to a term length. Here at MCCU, we offer our members certificates that can be open for just 3 months or as long as 5 years.
Plus, you can open any MCCU Certificate account as an IRA retirement account.
Is a certificate for everyone?
It’s important to note that your money will be tied up in the certificate, and you will not be able to access it without paying a penalty. A certificate works best for people who have a robust emergency fund and do not anticipate needing to access the funds in their certificate until its maturity date.
Why keep your money in a certificate?
Here are some of the most popular reasons people choose to open a certificate:
- No risk. While nearly every investment carries some sort of risk, your money is always safe in a certificate. Each MCCU certificate is insured by the by the National Credit Union Administration (NCUA) up to at least $250,000.
- Higher dividend rates. Certificates offer higher yields than most savings accounts.
- Locked-in rates. There’s no stressing over fluctuating national rates with a certificate. The APY is set when you open the account and is locked in until its maturity date.
If a certificate sounds like the choice for you, visit us or call us for more information and open your account today!
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