Saving for a long-term goal can take time. The fastest way to reach it is by earning the highest dividends possible on your money, such as locking in a high-interest rate with a share certificate. Share certificates let you earn a higher annual percentage yield (APY) than a regular savings account. Plus, they have special rules that discourage you from accessing your funds before your certificate matures, helping you stay committed to saving. Selecting the right way to save better improves your financial life. In this blog, we’ll explore some of the ways a Travis Credit Union certificate is a smart way to save.
What Are Certificates and Why Should You Lock in Rates?
A share certificate is a deposit product offered by credit unions. It is very similar to a certificate of deposit that banks offer, and both are federally insured. Certificates are generally a better savings tool than a regular savings account because they typically offer a higher dividend, or APY. Funds deposited into a certificate are locked in for a specific term, which can range from a few months to several years, at the end of which the certificate matures and you can access your money and the accrued interest.
Saving money with a share certificate is a low-risk, high-reward strategy, according to CBS MoneyWatch. By locking in a higher APY, you will grow your funds faster no matter if rates go up or down during the term. Recently, the Federal Reserve decided to keep interest rates steady, but experts believe that future rates may trend downward, according to MarketWatch. Locking in rates with a share certificate sooner than later lets you earn more now.
How To Compare Certificate Rates To Maximize Your Yield
To find the right share certificate for your savings goal, you’ll need to evaluate key factors such as length of term, interest rate and required minimum deposit. First, keep in mind when you will need your funds available to know what term to look for. For example, if you are planning to pay for trip in December and it is February, you know you’ll need a certificate that matures in 10 months or earlier.
When reviewing certificates, be sure to look at the APY offered with each term. Generally, the longer the term, the higher the interest rate will be. Find the one that fits your timeline and has the right rate for you. Keep in mind you may face penalties if you decide to withdraw your money before the certificate matures. That’s another reason to be sure you select the right term.
Travis Credit Union offers a selection of certificates with flexible terms, competitive APYs and lower minimum balances. TCU is focused on your financial wellness and makes it easy for you to earn higher yields so you can reach your short- and long-term savings goals faster.
What Strategies Can Help You Lock in High Certificate Rates at Travis CU?
There are a few economic indicators that can help you decide the best time to lock in a certificate with a higher APY at Travis Credit Union. Start by watching the news about the Federal Reserve so you will get an idea which way interest rates may move. If the Fed is proposing to increase the Federal Funds, this signals that rates could increase. Alternatively, if the Fed proposes to decrease the Federal Funds rate, you should lock in a certificate rate soon.
Typically, there is a $500 minimum deposit to open a certificate at Travis Credit Union. If you plan on saving a larger sum of money, consider a laddering certificate strategy. This is where you divide your money into multiple certificates with staggered maturity dates to take advantage of the higher interest rates offered by longer-term certificates.
For example, if you have $50,000 you want to save in certificates, you could divide this into five, separate certificates of $10,000 each with different terms and APYs. This will let you earn higher yields on longer-term certificates while having shorter-term certificates so you can access your funds earlier. See the chart below.
| Term |
Minimum Balance Req. |
| 12 months (365 to 729 days) |
$10,000 |
| 24 months (730 to 1094 days) |
$10,000 |
| 36 months (1095 to 1459 days) |
$10,000 |
| 48 months (1460 to 1824 days) |
$10,000 |
| 60 months (1825 or more days) |
$10,000 |
How Do Economic Trends Impact Certificate Rates in 2025?
As previously discussed, certificate rates will be affected by what the Federal Reserve does in 2025. These decisions may drive rates higher or lower. One of the bigger factors influencing the Fed is inflation. For the past two years, it has been combating inflation by increasing interest rates. As inflation decreases, the Fed may decide to begin lowering rates.
According to MarketWatch, the Feds’ actions mean you should not wait to lock in a high-rate certificate. Keep tabs on the Federal Reserve’s actions to see when the timing is right for you to lock in your share certificate.
How TCU Can Help
Travis Credit Union offers a variety of share certificates with competitive rates to help you grow your money and save for your financial goals. TCU also offers money market accounts and investment options that can build your financial nest egg. Visit Traviscu.org and open your share certificate today.
If you’re interested in learning more about financial wellness, enroll in TCU’s Knowledge Base for free online courses on a range of money-related topics designed to improve your understanding of money. Get started today.