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Types of Savings Accounts to Reach Your Goals

It’s never too early (or too late) to start saving, but putting away those first few dollars and sticking with it over time takes commitment, planning, and savings products that work for you.

Here we take a look at the full range of savings account options offered by Credit Union of America (CUA) and consider how best you can use each to reach your financial goals.

Cash Stash: The Best Accounts for Savings Success

Everybody should be saving, but not everyone’s savings needs are the same. Figuring out how to split off a few extra dollars from your monthly budget is different than growing a hard-earned nest egg into a house down payment, or turning a cash windfall into real wealth.

CUA offers a full range of savings products designed to help you start saving, build your reserves, and turn those assets into long-term value for you and your family.

Not sure where to start? Start here. We’ll save you a little time—and hopefully over time—a whole lot of money.

Savings Accounts

A savings account is usually your first stop when you’re trying to put money away. They are a great place to stash every extra dollar so you can start to earn a little interest.

And while accounts may have a limit on how many withdrawals you can make in a month, your money stays very close at hand since it’s accessible by ATM, branch teller, or through mobile or online banking.

Share Account

You can open a CUA Share Account when you become a member of our credit union with an initial deposit of $1, which is covered by us. Then you’ll earn a dividend on deposits over $100 (plus a higher rate on balances of $2,500). You can also put your children on the route to savings success by becoming a co-owner of an account for holders under age 14.

Holiday Club Account

CUA’s Holiday Club account is designed to help families with holiday shopping. You’ll earn monthly dividends on amounts of $25 or more and be able to cash out your savings in the first week of October. Saving ahead can help you and your family enjoy the holidays—and avoid starting the year with a hefty credit card bill!

Special Purpose Account

Plan ahead for life’s major events. A CUA Special Purpose account lets you set money aside for weddings, anniversaries, milestone birthdays, and other special occasions. With an initial deposit of just $25, you’ll earn dividends monthly provided you maintain an annual daily balance of $100 or more. And your money is available as soon as you decide the time is right to use it.

Pros and Cons of Savings Accounts

Whether you’re saving for a special event, creating an emergency fund, or building a nest egg, a savings account is a great place to start. Advantages of a regular savings account include:

  • Your savings are separate from your everyday expenses
  • Your money is instantly accessible via ATM, teller, or online transfer
  • You can begin to earn interest on your savings
  • Savings account deposits are guaranteed up to $250,000 per account

At the same time, it’s important to be aware of some potential drawbacks of savings accounts compared to other financial products. These may include:

  • Relatively low-interest rates compared to other investments
  • Low or minimum deposits may not qualify for interest
  • Some accounts may have monthly transaction limits
  • Some banks and credit unions may charge monthly or annual maintenance fees

Money Market Accounts

Money market accounts offer a higher interest alternative to regular savings accounts. While most also require a higher initial deposit or minimum balance, you’ll earn better interest rates while enjoying all of the security and many of the features of a regular deposit account.

Money market accounts come with standard transaction limits, meaning your money might not be accessible if you withdraw more than six times a month. While that can be inconvenient if you’re not planning ahead, many people find it provides just enough structure to help them get serious about building their savings.

CUA offers two different money market account products for investors at different stages of their savings journey.

Balance Boost

CUA’s Balance Boost money market account is a great way for starter savers to build a cash stash into a proper nest egg. With an initial deposit of just $100, you’ll earn interest from day one. In fact, we reward you for getting started on your savings journey by paying the higher interest on the portion of your balance under $2,500! 

Performance Plus

CUA’s Performance Plus account provides a safe, convenient place to keep significant savings while rewarding you for all the hard work you put into building your cash reserves. With a minimum initial investment of $25,000, a Performance Plus account pays progressively more interest for each additional $25,000 while keeping your money safe and instantly accessible.

Pros and Cons of Money Market Accounts

The structure, simplicity, and safety of money market accounts make them a favorite way to safely store money and build everyday savings into substantial cash reserves. Major advantages include:

  • Higher interest rates than checking or savings accounts
  • Money is easily accessible (subject to transaction limits)
  • Convenient deposit account features
  • Deposits are fully insured up to $250,000 per account

At the same time, money market accounts have some potential drawbacks compared with other savings products. These may include:

  • Higher minimum balance requirements
  • Monthly limits on withdrawals
  • Higher fees and charges than other account types

Share Certificates

Share certificates give savers with a plan a safe, predictable way to earn significant interest on money they do not need immediate access to. By agreeing to invest in a share certificate for a fixed period (anywhere between three months to five years) you’ll receive fixed dividend payments and a guaranteed payout at maturity.

CUA offers our members a range of certificate offerings designed to meet different savings needs and a full “ladder” of certificate terms. By reinvesting your earnings in progressively longer terms, you can safely grow your hard-won earnings into a major asset.

On-My-Terms Certificate

Our most flexible certificate offering, the On-My-Terms Certificate, lets you commit to an investment term that works with an initial investment as small as $500. Dividends are compounded monthly. The longer you invest, the more you’ll earn. You’ll know exactly what you’re getting ahead of time and your money is as safe as in any other deposit account.

1-Year Add-On Certificate

Our innovative 1-Year Add-On Certificate gives you a term investment with many of the features of a savings account. You can open an account with as little as $100 and add any amount to it at any time. It’s a great way to build strong savings habits, with the option to cash out or reinvest your earnings after a year.

CUA offers several other certificate products, including our innovative 30-Month Bump and Save to Win® certificates as well as our limited-time offers with special terms. Every CUA share certificate is designed to reward you for saving by giving you competitive rates, flexible features, and even cash prizes!

Pros and Cons of Share Certificates                               

Share certificates provide a safe, structured way to build your incidental savings into a substantial asset. Some of the major advantages of share certificates include:

  • Higher interest rates than checking, savings, or money market accounts
  • Fixed interest rates with predictable returns
  • Flexible terms from 3-60 months
  • Lower fees than most regular deposit accounts
  • Your investment principal and earnings are insured up to $250,000 per account

That said, it’s important to understand that share certificates are structured products with potential drawbacks for some savers. These may include:

  • Difficulty in accessing your funds until your certificate matures
  • Fixed dividends mean you could lose out if interest rates rise

Retirement and Education Accounts

Individual retirement accounts are long-term savings accounts designed to allow you to accumulate substantial savings over your working lifetime. Proceeds can be used to support yourself in retirement or to pay for a child’s higher education. Retirement accounts offer substantial tax benefits.

Traditional IRAs

CUA’s Traditional IRA allows you to contribute up to $6,500 a year (or 7,500 a year if you’re 50 or older). Tax on these earnings—and on the interest you earn each year—is deferred until you choose to withdraw the money, usually after the age of 59½. You are eligible to open a CUA IRA if you are younger than 70½ or your spouse has earned income.

You can withdraw funds from a traditional IRA to pay for a first-time home purchase, educational expenses, or some medical expenses—but some restrictions apply as to how much you can take out. Your withdrawals will be taxed as ordinary income.

Roth IRAs

CUA’s Roth IRAs allow you to contribute after-tax income to your account so you can enjoy tax-free withdrawals in retirement. Your money continues to grow tax-free and can be withdrawn tax-free when you retire.

You can also withdraw funds tax-free from a Roth IRA after a five-year holding period to help fund a first-time home purchase, qualified college expense, or certain medical expenses.

Coverdell Education Savings Accounts

CUA’s Coverdell Education Savings Account (CESA) allows families to work together to help fund a child’s education. Family members can contribute a total of up to $2,000 tax-free in any calendar year for children under 18 years of age. Withdrawals are also always tax-free when used for qualified educational expenses.

Pros and Cons of IRAs and CESAs

IRAs and ESAs differ widely and offer different advantages and potential drawbacks. CUA’s traditional and Roth IRAs and Coverdell ESAs offer protection for your investment principal while allowing your savings to grow over time. Other advantages include:

  • Tax-deferred contributions (IRAs) and tax-free withdrawals (Roth IRAs, Coverdell ESAs)
  • Tax-free interest growth
  • Early withdrawals for qualifying uses
  • Savings insured up to $250,000 per account

However, all IRAs and ESAs also come with some drawbacks, depending on your financial goals. These may include:

  • Potentially lower interest rates than directly invested funds
  • Funds are generally unavailable until retirement
  • Penalties for early withdrawals or unqualified use of funds

Which Savings Option Is Right for You?

CUA’s savings products are designed to cater to the changing needs of our members at every stage of their financial journeys. Which product is right for you now? It depends on where you are at, and where you want to go.

Savings and Money Market Accounts

Savings and money market accounts are important banking tools at any stage of your financial life, but they are particularly important when you are starting out. Use these accounts to set money aside from your monthly budget while keeping it instantly available in the event of an unforeseen expense.

Your savings and money market accounts are ideal places to set money aside for an emergency fund. This is a couple of months’ expenses you set aside to cover unforeseen costs or a sudden loss of income that would otherwise derail your budget or see you racking up expensive credit card debts.

Share Certificates

Share certificates are great tools for people who are saving with a clear timeline or goal in mind. To get the most out of share certificates you need to be able to commit funds for a set period. This can be just the right amount of financial discipline you need to make serious progress towards a car or house down payment or to pay for a special event like a wedding.

CUA’s 1-Year Add-On Certificate is a way to build savings quickly with the structure and higher interest of a traditional share certificate. But, you also have the ability to contribute money whenever you can, just like you would with a savings account.

Share certificates can also be helpful stepping stones to building long-term prosperity if you plan to reinvest some or all of your earnings on maturity in longer-term products. If you stagger your terms, you’ll always have the option to reinvest funds or withdraw the funds for immediate needs. Before long, you’ll find a tidy nest egg ready for a more diversified investment.

IRAs and CESAs

Traditional and Roth IRAs and Coverdell ESAs are long-term investments designed to secure your long-term financial security. While it’s never too early to invest in these products, the strict rules on withdrawals mean you should have your other needs taken care of before you commit serious funds to these products.

That said, money contributed early to an IRA will go a long way as it grows over years and decades. Choose a traditional IRA if you expect your earnings to remain roughly the same or decline as you approach retirement age. Choose a Roth IRA if you expect to earn more in the future. And remember, both these options allow you to withdraw money for education expenses.

Coverdell ESAs allow you and your extended family to spread the load of supporting a child’s education. While annual contributions are capped at $2,000, this can really add up over time. ESAs are also extremely tax-efficient when used as intended.

The following table summarizes which CUA products are best suited for particular uses.

  Start Savings Emergency Fund Special Event (Weddings, Milestone)

Down Payment
(car, house)

College Savings Retirement Cash Windfall
Share Account          
Holiday Club            
Special Purpose            
Money Market
Balance Boost        
Performance Plus      
Share Certificate
1-Year Add-On        
ITAs and ESAs
Traditional IRA          
Roth IRA          
Coverdell ESA            

Whichever product you choose, all CUA savings, money market, share certificate, and retirement accounts are fully insured up to $250,000 per account by the NCUA. You can rest assured that your savings and financial future are secure when you invest with us.

Start Strong With a CUA Savings Account

At Credit Union of America, we know how important savings are—and how much hard work and commitment it takes to put away a few dollars every month.

Our convenient and flexible savings accounts are designed to make it as easy as possible for our members to set aside money for their financial hopes and dreams while keeping money close at hand for unexpected costs and emergencies.

To start your membership with CUA, you’ll open a Share Account, which is our standard savings account. With this account, you have:

  • A minimum balance of just $1
  • Dividends paid on balances above $100
  • Deposits fully insured by the NCUA

Our other savings accounts, like Holiday Club and Special Purpose, offer innovative ways to plan for upcoming expenses so you can stay on track to reach your financial goals. Click below to learn how CUA can help you save today for a better tomorrow.


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