Once upon a time, it was relatively easy to compare CD rates among various credit unions. These institutions historically had the highest yields in comparison to many banks and would often be the preferred choice for most people. But today, the list of great deals in credit unions can be quite long and finding the right one to fit your financial goals could be more of a challenge. You need to become a strategical thinker when choosing the credit union best CD rates.
The Terms
One of the first things you want to consider when it comes to choosing CDs is the length of the term. Generally, the longer terms pay higher rates so a 5-year CD will usually have a higher yield than one that only has a six month term. So when you're choosing a new CD try to compare those CDs that hold longer terms to find the best rates.
Penalties
You also want to compare the penalty you may incur if you find you need to withdraw your funds before they mature. In most cases, the cost of early withdrawals can vary from one institution to another so while you may not anticipate having to make an early withdrawal of your funds, unexpected things do come up so you need to know what it will cost you to gain access to your money. It is important to know exactly what you're to expect before you invest.
All or Nothing
You also want to understand their 'all or nothing' feature when searching for the credit union best CD rates. Unlike with a savings account where you can withdraw only a portion of the money you've set aside in savings, you'll find that most CDs won't allow you to make a partial withdrawal. You may have to take all of it or nothing, which can stop the growth of your investment.
Once you are satisfied with the CDs that offer the most comfortable of these features for you, it is time to compare the annual percentage yields for the different credit unions. Historically you can find credit union best rates with online credit unions as opposed to the brick and mortar institutions. The downside of finding these rates is not in having higher yields but in finding them in a credit union that you can actually qualify for. Unlike banks where anyone can open an account, you need to find one that you qualify to become a member in. In the past, many credit unions had pretty strict requirements but now you can find some that are pretty lax about bringing in new members, you'll have to do your homework to make sure you don't overlook one of these opportunities.
Finding the credit union best CD rates will require you to do some digging but the rewards you can reap for your efforts are great. While banks traditionally hold the lion's share of the CD markets, finding the right credit union that offers competitive rates can prove invaluable when it comes to investing and planning for your financial future.