Everything You Need to Know About CDs

Nobody wants to take risks with their hard-earned savings. Whether you've recently acquired a significant amount of money from a work bonus or inheritance or have diligently saved over time, the goal is to locate a secure avenue for your money to grow without fearing potential losses.

Community Resource Credit Union brings you a variety of secure savings options, such as savings or money market accounts. Another excellent option available is our certificates of deposit (CDs). Let's take a closer look at CDs and explore why they could be the ideal choice for you.

What is a CD

A CD is a savings account with a fixed dividend rate and maturity date. The dividend rates of these accounts tend to be higher than those of savings accounts, and there is generally no monthly fee to keep the certificate open.

In contrast to savings accounts, CDs have more restricted access to the funds. Usually, once you've made your initial deposit into a certificate, you cannot add more money. However, you have the flexibility to add additional funds to a CRCU CD*. Also, withdrawing funds before the maturity date typically incurs a penalty.

How Does a CD Work

When it comes to earning from a deposit account, several key factors come into play. At Community Resource Credit Union (CRCU), we want to guide you through the process of making the most of your investment in a CD.

Initial Deposit: Your journey begins with the amount you put into the CD. While each bank typically sets a minimum deposit requirement, CRCU ensures accessibility with our flexible options.
CD Term: The duration your funds remain in the CD is crucial. This term directly affects when you can withdraw your money without any penalties. The longer the term, the greater the potential return.
Interest Rate: The interest rate is a vital component. It remains fixed throughout the term, impacting the actual rate of return or the annual percentage yield (APY).

At CRCU, we allow you the option to add funds to your CD, offering even more control over your investment. However, keep in mind that withdrawing funds before maturity may lead to early withdrawal penalties.

When your CD matures, the amount of interest you earn depends on the interest rate, the term length, and how frequently interest is compounded. At CRCU, we ensure maximum benefit by compounding interest on a monthly basis, allowing your investment to grow even more effectively.

Is a CD for everyone

While keeping your savings in a CD can be an excellent option for your money, it may not be suitable for everyone. Before you move forward with opening a CD, be sure you won't need to access the funds before the maturity date. Keeping a separate emergency fund is an excellent idea to help you through an unexpected expense.

If a CD seems like the right fit for you, don't hesitate to contact us to explore it further, or click here to learn more. We're committed to giving your money its best chance at growth.