Are you looking for a safe way to grow your savings? Do you have extra money that you won’t need to use any time soon? If so, you should consider Eastex Credit Union investment certificates. Investment certificates are commonly called certificates of deposit, or CDs. They give you a better interest rate on your money than you get in a savings account but differ from regular savings accounts in several ways. Here is some information to help you determine if one would work for you.
What is a CD?
A CD is a commitment to keep your money in an account for a set amount of time. The time you choose to keep your money in the CD is called the term length. With regular savings accounts, you can make regular withdrawals, however, with a CD, you have agreed to not withdraw it for a set amount of time. Terms can be as short as three months, to as long as several years or more. Interest rates are higher for CDs with longer term lengths.
Why Choose a CD?
Certificates are one of the safest types of investments you can make. You can accurately estimate your earnings from a CD, which can help when planning for the future. You are also in control of all aspects, including determining how much money to put into a CD and how long you want it to stay there. A CD is a great option when you want a fixed return on your investment and are confident you can leave your money deposited for the term length.
CDs can be an important part of your financial planning for the future. The practice of laddering is common with savers who want the high-interest rates that are available with the longer term lengths but are wary of having their money tied up for that long. Therefore, they invest their money in several CDs with a variety of term lengths. As each certificate matures, the money is reinvested in a new CD with the longest term and best interest rate. For example, let’s say you have $6,000 to invest.
You could have 12-month, 24-month, and 36-month CDs, which each have $2,000 in them. When the 12-month CD matures, you reinvest the funds into another 36-month CD. You continue doing so when each CD matures. After three years, you would have high-interestst rate CD maturing every year. You can do this while leaving you with the flexibility to use your funds if you needed to.
You can meet your long-range savings goals with investment certificates from Eastex. A minimum deposit of $500 is required to open your account. The shortest term is three months, with the longest term being 36 months. Interest is accrued and paid either monthly, quarterly, or upon maturity of the certificate. You also have the option to have the interest compounded in the share certificate (for a higher yield), then deposited into another Eastex CU account, or mailed to you in a check. The current terms and dividend rates for Eastex CU certificates are listed below.
|Share Certificate Terms||Share Certificate||Account Dividend Rate|
|3 Months||500 & over||0.35%|
|6 Months||500 & over||0.50%|
|12 Months||500 & over||0.75%|
|18 Months||500 & over||0.80%|
|24 Months||500 & over||1.15%|
|36 Months||500 & over||1.40%|
It’s always fun to check out how your share savings can grow, and you can do that with our interactive savings calculator.
To start growing your savings with investment certificates contact us, we’re here to help.