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CD (Certificate of Deposit) or Share Certificate, is there a difference?

Banks offer a CD (Certificate of Deposit), which is a type of savings account where a member can deposit a lump sum of money for a specific length of time and will accrue interest at a guaranteed rate if left untouched.  Credit unions also offer the same type of savings account but refer to it as a Share Certificate.

Both share certificate and CDs are considered a safe investment option as they earn a fixed rate throughout the term of the account.  Both offer a higher more competitive annual percentage yields (APYs) to their members as an incentive to complete their chosen term and not withdraw their funds prior to maturity date of the account.

Maturity dates can range from several months to years on these accounts and will typically have a higher, more competitive rate than traditional savings and money market accounts.  If the member wishes to withdraw their funds prior to the designated maturity date, they may incur an early withdrawal penalty.

Both share certificates and CDs are also insured up to $250K per person.  Credit unions are insured by NCUA (National Credit Union Administration) and banks by FDIC (Federal Deposit Insurance Corporation).

As you see, there is little difference between a CD and a Share Certificate.  Many of the differences you’ll see are with Banks vs Credit Unions.

One of the most notable differences is that credit unions are a not-for-profit and member owned organization. Any profits earned are distributed back to its members in the form of higher dividends, lower interest on loans and lower fees to name a few.

Whatever your savings goal might be, Fitzsimons Credit Union can help you achieve those goals.  We offer several Share Certificates at various terms so finding the right one will be easy.