A Certificate of Deposit is a commitment to keep money on deposit for a specific, predetermined period or term. In exchange, the CD earns dividends that can rival other investments, like stocks. This type of savings account is the perfect option for those who want to grow their savings without taking on the risk that typically comes with similar investment opportunities. It is important to remember that you will have to live without this money for the duration of the CD, so keep that in mind when considering this option. Of course, the funds are yours and always will be. This means you can close a CD before the maturity date if you really need access, but a penalty will be assessed.*
The process of a CD is simple: A specific amount is deposited for a specific term, locking in a specific rate. Your rate is guaranteed throughout the full term of your deposit. When that term is up, you choose where it goes next on its journey. Leave it to renew for another term – at whatever the rate is at that time – or withdraw the funds within 10 days of the maturity date with no penalty. All SunWest CDs are compounding, which means dividends are added to your balance each month, so you earn more money. As your balance grows, so does your return since dividends are calculated on the new, higher balance instead of the original balance.
We can talk about saving money until the Cardinals win a Superbowl, or until your three-year-old finishes telling you a story, but we know you can’t wait around for a miracle so let’s get to it. Diversifying your portfolio can be a good way to ensure you have access to money should you need it, while also building your returns in a sustainable way. Instead of committing the total amount you want to set aside to a single CD, you can divvy up those funds and spread the love across multiple CDs–each with different maturity dates. While this strategy slightly decreases the overall dividends earned, portions of the total sum become available for reinvestment throughout the life of the ladder.
You have $3,000 just begging to be invested, and you like the idea of earning a fixed rate for a fixed period of time so you know exactly what to expect. You’ve made up your mind to open a CD but you still like the idea of being able to pull funds if necessary, so you decide to break up your investments between three different CDs with varying terms:
$1,000 in a 12-month Share Certificate
$1,000 in a 24-month Share Certificate
$1,000 in a 36-month Share Certificate
Once the first certificate matures, you have three options:
Reinvesting the money in a new term would provide access to a portion of the funds once the 12 months is up if needed, but it also helps to keep the Certificate ladder fully funded.
Deposit as low as $500 for any of our terms. Tiptoe into this ocean without fear of shark-infested waters.
Terms start as short as 6 months and can go as high as 5 years. Higher terms typically earn higher rates. You don’t have to go big or go home. Set your pace.
There is no limit on the number of CDs you can have at SunWest. Set up a 5-year certificate for each one of your children and let it renew until you’re ready to give them the funds. Bonds are out, CDs are in.
* See a representative or Share Certificate agreement for complete details. APY = Annual Percentage Yield.