CD rates have gone up – BECU is excited to be offering new, higher rates for members who want to make CDs part of their overall savings plan. And if you have Member Advantage you can earn even more!
The biggest benefit with a CD is that you earn a higher rate of return than a standard savings account. Let's dive into all the ways CDs can help build up your savings, and why you should consider opening one.
A CD is a certificate of deposit. It's really just a savings account that has a fixed amount of time (term) you agree to invest your money, and in return you receive a higher interest rate than you would receive on a standard savings account. If you need your money before the end of the term (CD maturity date), you may incur an early withdrawal penalty fee. The fee is to incentivize you to not access your money, and instead let it grow!
First, pick an amount that you're going to deposit. At BECU, you can open a CD with as little as $500. Then, choose the term you'd like to invest your money. BECU offers terms as little as 3 months and as long as 60 months (5 years). Generally the longer your term, the higher your interest rate.
Do you like keeping tabs on the market and following interest rate forecasts? A 12- or 24-month Bump CD might be a good choice. Not only do these have a one-time option to increase the interest rate on your CD to the current BECU published rate for the equivalent-term CD, but bump rate CDs are of particular value in a rising rate environment.Add-to Option
This option lets you make additional contributions to your CD while maintaining your fixed interest rate. It's also a fantastic way to set up a systematic savings plan. Members can set up recurring transfers from savings or checking in to an Add-to CD each month! The add-to option is also a good starter CD for low minimum amounts: Select the Add-To-Option, and you can open a CD with as little as $100.Laddering
Want to have frequent access to your CDs at maximum earning potential? You can, with a simple and effective strategy known as CD Laddering! Read about “laddering” CDs.
To open a CD, you must establish and maintain membership by opening a Member Advantage Savings Account or Member Share Savings Account. Early withdrawal penalties may apply.