Credit Union CD Rates: What You Need to Know
While brick-and-mortar banks are notorious for stingy interest rates on savings accounts, some credit unions offer competitive rates on certificates of deposit (CDs). If you’re in the market for a high-yield investment, credit unions can be a good choice. Their low fees, higher customer service, and non-profit status can make them a better option than traditional banks.
Credit unions are a type of financial institution that’s owned by its members and operated for the benefit of the community. They often have lower minimum deposits than banks and offer a variety of savings, checking, and CD accounts. They also offer a number of specialty types, including bump-up CDs Credit Union CD Rates and accounts that allow you to add money during the term.
Earnings: The annual percentage yield (APY) is a key indicator of whether a CD offers you the best rate. But you should also consider other factors like the frequency of compounding and flexibility.
Fixed rates: A fixed rate is a good deal for savers who want a guaranteed return and are comfortable leaving their money in the bank for a set amount of time. However, if rates go up substantially, it could be difficult to recover losses on a fixed-rate CD unless you’re willing to take on more risk by investing in other assets.
Early withdrawal penalties: If you’re interested in a shorter-term CD, consider checking the fine print to see how much it will cost to withdraw your funds before the maturity date. Some credit unions have very liberal early withdrawal penalties, while others are stricter.
CDs are time-based savings vehicles offered by credit unions. You can choose from a wide range of terms, from six months to five years. These contracts are a great way to diversify your savings, but be sure to read the terms carefully before making any decisions.
APY: The annual percentage yield is a key indicator of whether a credit union CD offers you the best rate. But you shouldn’t forget to factor in other factors like the frequency of compounding and the flexibility of the terms.
The average APY on a one-year credit union CD was 1.64 percent in March, according to Bankrate’s weekly survey of institutions. This is an improvement over the last year, but it’s still below the average for 1-year CDs of 2.22 percent.
Credit Union CDs are federally insured by the National Credit Union Administration (NCUA), and you’ll find these CDs at nearly any credit union nationwide. They typically come with very low minimum deposit requirements, and you can start earning interest in as little as $5.
Membership: SchoolsFirst FCU serves the California educational community, offering checking and savings accounts as well as CDs. This credit union is open to current school employees and their families as well as retired school employees and their families.
The credit union has a number of branches in the area, but members can access their accounts online or through CO-OP’s shared branching network. They can also transfer funds from another FFCU account.