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FInancial Wellness

Savings 101

Did you know there are different types of savings account? Learn about traditional savings accounts, as well as Certificates of Deposit, Money Market Accounts, and Individual Retirement Accounts (IRAs).

Your savings account is like your best friend – if you treat it well in the good times, it will be there to take care of you should an emergency arise. Your emergency fund should give you at least a 3-6 month cushion. This is why having a monthly budget is so important. It tells you how much you spend on your monthly expenses. Below you will find some options for storing and building your savings.

Types of Savings Accounts

Savings Account

A savings account is usually the first banking product people use and is a great way to meet short-term goals. Savings accounts earn a small amount of interest and are considered to be low risk. It is also easy for you to access your money when needed. With your $5 minimum deposit to a Share Savings Account, you become a member-owner of DCCU, entitled to take advantage of all the benefits, products, and services available to our members. Maintaining a $5 balance in your Share Savings Account represents your share in the Credit Union.

father and son saving loose change in a jar

Money Markets

When you have money that you want to earn a higher return than a simple savings account, but want access whenever you need it, a Money Market Account may be your best option. There is a set number of withdrawals you can make per month without penalty. Money Market accounts usually pay a higher rate than savings accounts but normally lower than CDs. These accounts are also insured by the federal government and require a higher balance than a savings account.

Certificates of Deposit

Certificates of Deposit allow you to invest your money at a set interest rate for a pre-set period of time. They often have higher interest rates than traditional savings accounts because when you buy one, you are actually loaning the financial institution money for a set period of time and getting interest in return – the longer the term (ranging from 6 months to 5 years) the higher the rate. But be sure you do not need to draw on those funds before you open a Certificate of Deposit, because early withdrawals may result in financial penalties. These accounts must be opened in-person, at one of our convenient locations.

woman counting money in her home

Individual Retirement Accounts (IRAs)

Thinking about retirement? IRAs are useful if your employer doesn’t offer retirement benefits or you want to save more than you employer-sponsored plan allows. There is no better time than the present to start saving or to make additional contributions for your retirement. IRA Certificates provide:

  • Greater earnings through a higher dividend rate
  • Peace of mind knowing that your retirement funds will earn a constant rate
  • Security knowing that your funds are federally insured by the NCUA
  • Traditional and Roth IRA accounts are available to assist with retirement planning. These are ideal choices if you're rolling over a plan from an employer.