FMFCU certificates offer a great way to save a short- and long-term needs. Terms vary from 3 months to 5 years and our certificate products offer high yields. Unlike some other investment options, your funds are insured by NCUA.
- Membership eligibility applies
- $500 minimum balance requirement
- Monthly, quarterly, or annual automatic distribution of dividends
- View rates and terms
Certificate Ladder Strategy
A certificate ladder can help you earn an even higher return on your savings. A ladder consists of multiple, sequential certificates all opened at the same time. Each “rung of the ladder” is a certificate with a different term and your ladder can contain as few or as many rungs as you like.
A ladder could consist of 12-, 24-, 36-, 48-, and 60-month certificates. Or for a less aggressive certificate ladder you could choose shorter terms, such as a 6-, 12-, 18-, 24-, and 36-month ladder, which will keep your money more readily available.
An Example of Certificate Laddering
Instead of opening one 60-month certificate for $25,000, open five certificates for $5,000 each for the following terms:
As each certificate matures, you can either use the funds you need or renew into another 60-month term like in the table below.
ORIGINAL TERM ORIGINAL MATURITY DATE RENEW INTO NEXT MATURITY DATE 12-Month 9/11/2018 60-Month 9/11/2023 24-Month 9/11/2019 60-Month 9/11/2024 36-Month 9/11/2020 60-Month 9/11/2025 48-Month 9/11/2021 60-Month 9/11/2026 60-Month 9/11/2022 60-Month 9/11/2027
Why Ladder Certificates?
When you ladder certificate accounts, you will have 20% of your certificate savings available each year. And, when you renew each maturing certificate into a new 60-month certificate, you will be earning a higher rate compared to simply continuing with another 12- or 24-month certificate.
The strategy works to your advantage because after several of your certificates have matured and have been renewed into additional 60-month certificates, you will be earning the highest rate and have a 60-month certificate maturing every year.
This strategy can be applied to shorter- and longer-term examples. Laddering can provide you with a more steady and stable source of savings than a single-certificate investment. The best part is, you can always add funds to your certificate at maturity and watch your savings grow!
* Two-year term and rate only available on personal certificates.