Where to Park Your Cash
If you're wondering where to put your cash to keep it safe and secure, where it can potentially earn more interest than a traditional savings or checking account, consider a Share Certificate.
A Share Certificate can be a good option for money that you will need in the future (but it’s not recommended for your emergency fund). For example, if you are planning to take a cruise to celebrate your anniversary, a Share Certificate can be a nice option to park your vacation money until you are ready to use it. A Share Certificate is a more secure investment when compared to mutual funds or stocks.
You deposit money into a Share Certificate for a set amount of time, and in exchange, you receive interest for the term of the Share Certificate. If you pull out your money early, you will incur a penalty.
The rate risk associated with Share Certificates comes into play when rates go up and your Share Certificate hasn’t matured. You’re locked into the lower rate until that Share Certificate matures. Laddering can help mitigate rate risk. When you set up a Share Certificate ladder, you put your money into a few different Share Certificates with varied dates of maturity. You can capture any increase in interest rate as your Share Certificates mature by reinvesting them at the new rate. Laddering also provides you with some flexibility to access your cash as the Share Certificates mature.
NE PA Credit Union Share Certificate features:
- Minimum deposit is $1,000.00
- Terms range from 91 days to 5 years
- Dividends paid monthly
- Contracted dividend rate is guaranteed
- Six calendar day grace period after maturity to make changes without penalty
- Jumbo Share Certificates available
Ready to open a Share Certificate? Visit www.nepafcu.org to check rates, then log in to your NE PA account to set up a Share Certificate. If you need assistance, please contact a Member Service Representative at 570-421-5585. NE PA Credit Union is Federally Insured by NCUA.
