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A Share Certificate is a credit union's version of what conventional banks call a Certificate of Deposit. The cash you deposit is insured by the NCUA up to $250,000 just like any other savings account option, but the rate of return is often substantially higher. For specific APY percentages, check out the Coosa Valley Credit Union's real-time rates page. You can choose a shorter or longer-term option, depending on your needs and desired dividend rate.
Share certificates are perfect for these kinds of investment scenarios:
- Your child’s godmother makes a gift in a substantial amount. It's too much to simply dole out to your youngster, but it’s not intended for college. While your child grows, stash her cash with a safe Share Certificate that will mature as she does.
- You receive a Christmas bonus. If you don't want to tie it up in risky stocks, but you don't want it to dwindle away in your checking account, consider a Share Certificate.
- Your teen won a monetary award for outstanding community service, but doesn't know what to do with his winnings quite yet. He would like to take a year to decide.
- Your savings account has exceeded your goal and you'd like a safe place for the excess funds to grow.
Here are a few factors to help you decide whether a Share Certificate might be the best savings option for you.
- Limited access. While the monthly dividends you receive on your cash may be enticing, your cash (and its earnings) are hands-off until the agreed upon time.
- Fees for early withdrawal. Money you deposit in a Share Certificate belongs to you, but withdrawing it before the specified investment period will result in a substantial fee. For that reason, Share Certificates are not good savings vehicles for emergency funds. They should be considered investments that need to mature fully before they are withdrawn.
- Minimum balance. Not only must you deposit a minimum amount initially, a share certificate account must maintain a certain level to remain viable. In other words, deposit more than $1,000, and again, plan not to touch it pre-term.
- Single deposit. A Share Certificate does not allow you to invest more and more as you go. They are one-time deposits that mature over a set period of time.
To get started, phone a Coosa Valley Credit Union team member today to discuss your unique situation, talk about your goals, and determine whether a Share Certificate is your best bet at this time. Or, keep an eye out for our occasionally promoted specials on Share Certificates, which could provide just the incentive you need to stow your treasure in a place much safer than a hole in the backyard.