Regular Share Certificate
A Share Certificate or (CD) is a savings investment with a fixed maturity date and specified fixed interest rate that can be issued in any denomination above the minimum deposit requirements. A CD restricts access to the funds until the maturity date of the investment. Prospectors Share Certificates are added to all other share savings products, Checking accounts, Regular Savings accounts and Money Market accounts are added together and insured by the National Credit Union Administration (NCUA) up to $250,000 per individual account holder. In addition Prospectors offers an additional $250,000 worth of insurance per individual through American Share Insurance (ASI). The following table illustrates how much an individual could have insured at Prospectors.
|Account Type||NCUA Coverage||ASI Coverage||Total Insured|
Bump Rate Certificates
To protect savers when interest rate markets are rising, Prospectors offers ‘Bump Rate’ certificates. These 24 month certificates allow members to reset their rate to a a new higher rate once during the term for the remainder of the term. They also allow members to add additional monies to the certificate at the time it is being reset to a higher rate. These unique certificates become a great advantage to members to take advantage of improved yields for longer terms.
Educational Savings Accounts
ESA’s are a great tax advantaged savings product for parents putting money aside for their young family members for higher education. Once money is being saved it is accessible to most costs associated with higher learning. The tax advantage to the student is that they do not have to claim the money as income.
An accelerated saving product for long term savers.
Typically you as a saver will receive higher dividend rates on a certificate if you commit to leaving your money with the Credit Union for a longer period of time. However, the lack of liquidity or fear that dividend rates will begin to rise in the very near future causes many savers to choose shorter-term certificates at the expense of receiving the higher interest rates. Now Prospectors has a solution that offers our savers the best of both worlds. It’s the IRA “Freedom Certificate” and it uses a strategy that gives our savers the benefit of receiving the higher dividend rates of longer term certificates while still providing some flexibility and liquidity each year. Here’s an example; rather than depositing $10,000 ($2,500 is the minimum deposit requirement) into a 1-year certificate and then renewing it each year at the lower 1-year rate, you would open a $10,000 IRA “Freedom Certificate” which will automatically deposit $2,000 into 5 separate annual tier/terms, 1 thru 5 years. Each year on the anniversary date, 1/5th of the of the certificate or in this example $2,000 plus the interest that tier/term has earned, will roll over to the then 5-year rate. This repeats itself each year on the anniversary date so that on the 6th year all 5 tier/terms of your IRA “Freedom Certificate” will be earning a 5-year rate. The beauty of this certificate is that you will have access to 1/5th of your money each year. This means that each year on your anniversary date you can add your yearly IRA contribution to the renewing tier/term of the certificate and get the current 5-year rate, or if you are retired and funds are eligible, withdraw a portion with no penalty.
This calculator will help determine the additional interest you could earn with an IRA “Freedom Certificate”.
IRA Shares and IRA Share Certificates
IRA Share accounts are typically accumulation accounts for members working towards the minimum Share Certificate and Freedom Certificate account deposits. IRA Share Certificates are term accounts that provide members with greater return than regular IRA Share Accounts. Follow this link for more information.