The Advantages of Having Credit Union Savings Share Certificates

There are so many financial options, and financial products from which to choose. Customers need information on which financial options are open to them and which bank or credit union to visit to find these options.

There are checking accounts, savings accounts, and money market accounts, to name only a few. But there are also savings share certificates.

Savings Share Certificates

Savings share certificates are savings, offered at credit unions, that are like CDs (certificates of deposit), which you will find at banks. Here are some benefits. Savings share certificates…

  • offer good yields (at a higher rate than a traditional savings account),
  • similar to bank CDs, a savings share certificate requires money deposited to mature in the account for a specified amount of time (early withdrawal will incur a penalty), and
  • if you choose a certificate that requires more months to mature, you’ll earn a higher rate of savings.


Not unlike what the FDIC (Federal Deposit Insurance Corporation) is to banks, the NCUA (National Credit Union Administration) is to credit unions, which are federally insured up to $250,000.

Dividends for savings share certificates are designated as annual percentage yield (APY), which can be compounded on an annual, quarterly, or monthly basis. Daily compounding is something to look for when looking into share certificates. Like other higher yield accounts and certificates, penalties are charged for early withdrawal, subject to the terms and conditions of the certificate and the credit union.

Certificate Types

Here are 3 common savings share certificate types:

  • Adjustable-rate. Sometimes called bump-rate certificates, these certificates allow you to adjust up, or “bump,” your rate during the time of the account’s maturity. This depends upon the rate that the credit union offers. If it goes up, you’ll have the choice to adjust your certificates to the new higher rate.
  • Student certificates. Often these accounts are for young people aged 18 and younger. These certificates will mature quicker than others and often will have low minimum balance thresholds.
  • Jumbo. Jumbo certificates require significant low balance minimums (sometimes, a minimum of $10,000 or higher is required), but also have higher yields.
  • Certificate ladder. Certificate ladders allow you to have higher yields without having to store your money for a lengthy amount of time. You may invest in several disparate certificates of differing maturity lengths, but then switch money from one certificate, after it fully matures, into another with a higher yield, for example. You may also withdraw the money, and there will be no penalty because you have satisfied the time of maturity. This allows you to have liquid cash as well as higher earning savings at the same time.

Credit unions offer other benefits, such as free checking. For instance, you are more than twice as likely to have free checking at a credit union than you are at a bank. Visit your local credit union today to learn more.

Savings share certificates allow customers to save their money at higher than normal yields and be protected at the same time. Other savings accounts at various financial institutions cannot give you this type of flexibility and savings potential.

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