Credit Union CD Rates in Sacramento, California for 2023

Credit Union One-Year Certificates of Deposit in 2023

Credit unions offer time-based savings vehicles known as certificates of deposit (CDs). By agreeing to keep your money with a credit union for a specific period of time, you can earn a fixed rate of return. However, be aware that early withdrawal penalties can be significant, and some credit unions may not offer this option at all. It is crucial to thoroughly understand the terms and conditions of any time-based deposit before committing to it.

Benefits of Credit Union CDs

Many Americans prefer credit unions for their banking needs due to better rates, non-profit status, helpful employees, and a strong commitment to the local community. To find credit unions near you, refer to the accompanying map. Keep in mind that some credit unions have restricted membership criteria. Meeting these requirements is essential to becoming a member and opening a CD or time deposit.

For those willing to invest their money for one year, credit unions often offer slightly higher rates compared to regular savings accounts. When compared to local and online banks, credit unions may provide more attractive rates for 1-year CDs or time deposits. Nevertheless, it’s always advisable to check the rates offered by local and online banks in your area.

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To explore all the options for generating income as a saver, refer to the Income Generating Investments Comparison Chart.

NCUA Insurance

Most credit unions listed on BestCashCow are insured by the National Credit Union Administration (NCUA). It is important to verify whether the credit union you are working with is NCUA-insured by visiting their BestCashCow page. NCUA insurance ensures deposit protection for each named individual up to $250,000 across all accounts within the credit union’s ownership class. The rules surrounding NCUA insurance are similar but not identical to those of FDIC insurance. Always stay within NCUA insurance limits to ensure the safety of your deposits.

At BestCashCow, we strongly recommend depositing money only in NCUA-insured credit unions and abiding by the insured limits. If you are considering depositing more than $250,000 at a single NCUA-insured credit union across different products or types of ownership, make use of the NCUA’s Share Insurance Toolkit to ensure you stay within coverage limits.

Is My Money Safe at a Credit Union?

As long as your credit union is NCUA-insured and you comply with the NCUA limits, your money is no less safe than it would be in an FDIC-insured bank.

Time Deposits vs. CD Accounts: Are There Any Differences?

The difference between a time deposit offered by a credit union and a CD account offered by a bank is primarily one of terminology. However, it is crucial to fully understand the terms and conditions, especially regarding early withdrawal penalties. A reasonable early withdrawal penalty for a 1-year time deposit typically amounts to three months.

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Is the Interest on a Time Deposit Worth the Loss of Liquidity?

The answer to this question depends on your specific circumstances, cash needs, and other investment opportunities you may wish to pursue within the duration of your time deposit or CD. While the premium for a one-year CD may be small, compounding interest can make a significant difference over a longer period. Consider using our Savings Booster Calculator to appreciate the impact of compounding interest at higher rates over time.

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