Share Certificate vs. High-Yield Checking: Where Should Your Money Grow?
You work hard for your money every day, so shouldn't it be earning its keep while it sits in your account? If you're tired of watching your savings barely budge in a traditional account, you've probably wondered where to put those extra dollars for the best return. Two popular options at Public Service Credit Union offer compelling opportunities: our 9-month Share Certificate at 4.4% APY and our revolutionary Surge Checking Account offering 10% APY on your first $1,000.
The choice isn't always straightforward. While that 10% return on Surge Checking might catch your eye immediately, the right choice depends on your financial goals, timeline, and how you prefer to access your money. Understanding the unique benefits of each can help you make the smartest decision for your situation.
Understanding Your Options
Share Certificates: The Steady Performer
Think of a Share Certificate (the credit union equivalent of a bank's Certificate of Deposit) as your financial equivalent of a reliable friend. When you open a share certificate, you agree to leave your money untouched for a set period in exchange for a fixed dividend rate that's typically higher than regular savings accounts. Public Service Credit Union's 9-month share certificate currently offers 4.4% APY with a low $500 minimum deposit.
Here's how share certificates work: You deposit your money for exactly nine months, and we guarantee you'll earn 4.4% APY during that entire period. The rate is fixed, meaning it won't change regardless of what happens in the broader economy. When your share certificate matures in nine months, you'll receive your original deposit plus all the dividends earned.
Surge Checking: The High-Energy Earner
Our Surge Checking Account breaks the mold of traditional banking. This isn't just a checking account – it's your everyday banking solution that also happens to earn an impressive 10% APY on the first $1,000 in your account. That means you could earn up to $100 per year just on that first thousand dollars, with dividends paid monthly.
What makes Surge special: You maintain complete access to your money through debit card purchases, bill pay (coming later this month with our new mobile app and online banking), and all the conveniences of modern checking. Plus, you're earning that exceptional rate on money you might otherwise keep in a non-dividend bearing checking account.
Crunching the Numbers
Let's see how these options compare with real money scenarios:
Scenario 1: You have $1,000 to save
9-Month Share Certificate (4.4% APY): After nine months, you'd earn approximately $33 in dividends
Surge Checking (10% APY): After nine months, you'd earn approximately $75 in dividends, plus you have full access to your money the entire time
Scenario 2: You have $5,000 to save
9-Month Share Certificate (4.4% APY): After nine months, you'd earn approximately $165 in dividends
Surge Checking (10% APY on first $1,000, then 0.15% on remaining): After nine months, you'd earn approximately $77 total ($75 on the first $1,000, plus about $2 on the remaining $4,000)
The takeaway: For amounts up to $1,000, Surge Checking significantly outperforms the share certificate. For larger amounts, share certificates become more competitive, especially when you don't need immediate access to your funds.
When Share Certificates Make Perfect Sense
Share certificates are better suited for goals on specific timelines that match maturity dates. Consider a share certificate when you:
Have a specific future expense: Planning to buy a car next spring? A 9-month share certificate perfectly aligns with a March or April purchase. You can purchase a share certificate with a maturity date that aligns with your specific goal.
Want guaranteed returns: With a share certificate, the higher dividend rate compensates you for locking up your money until maturity, and the rate won't change during the account's term. If dividend rates drop, you're protected.
Prefer forced savings: If you withdraw money from a share certificate before it matures, you'll usually have to pay a penalty. This may help you resist the temptation to impulsively tap the money.
Have larger sums to invest: For amounts significantly over $1,000, share certificates often provide better total dividend returns than keeping everything in Surge Checking.
“Both our Share Certificates and Surge Checking Account offer exceptional value compared to traditional banking products. The key is understanding how each fits into your broader financial picture.”
When Surge Checking Is Your Best Bet
High-yield checking accounts are better for building and maintaining emergency savings since the cash is more readily available. Surge Checking is ideal when you:
Need flexible access: Life is unpredictable. Surge Checking gives you the flexibility to access your money instantly while still earning exceptional dividend returns on that first $1,000.
Want everyday banking convenience: Unlike a share certificate, Surge Checking functions as your primary checking account. Pay bills, make purchases, and earn great dividends all in one place.
Have $1,000 or less to start: The math is simple – you'll earn more with Surge Checking on amounts up to $1,000, period.
Prefer liquid emergency funds: High-yield checking accounts are eligible for National Credit Union Administration (NCUA) coverage and typically don't have withdrawal penalties, so you can access your money whenever you need it.
Smart Strategies for Maximum Growth
Why choose just one? Many of our members use both products strategically:
The Foundation Strategy: Keep your first $1,000 in Surge Checking to maximize that 10% APY dividend return, then put additional savings into share certificates for higher dividend returns on larger amounts.
The Timeline Strategy: Use Surge Checking for your emergency fund and short-term goals, while share certificates work for specific future expenses with known dates.
The Ladder Approach: A share certificate ladder is a strategy for investing your money in long-term share certificates while making sure you always have access to some of it in the short term. Consider opening multiple share certificates with staggered maturity dates, keeping your most accessible funds in Surge Checking.
Making Your Decision
The choice between a share certificate and Surge Checking isn't really about finding the "best" option – it's about finding the right option for your specific situation. Ask yourself:
How much money are you looking to save or invest?
Do you need access to these funds in the next nine months?
Are you looking for guaranteed dividend returns or comfortable with some flexibility?
Would the convenience of combined checking and high-yield earning appeal to you?
Bottom line: For your first $1,000, Surge Checking offers unmatched dividend returns with complete flexibility. For larger amounts or money you won't need for nine months, share certificates provide competitive guaranteed dividend returns that can complement your Surge Checking earnings.
Your Next Steps
Both our Share Certificates and Surge Checking Account offer exceptional value compared to traditional banking products. The key is understanding how each fits into your broader financial picture.
Ready to put your money to work? Visit our Wausau branch, call us at (715) 842-9865, or email us at info@publicservicecu.org to discuss which option aligns best with your goals. Our team can help you calculate potential earnings and design a savings strategy that maximizes your dividend returns while meeting your lifestyle needs.
Rate may change after account is opened. Fees may reduce earnings. Federally Insured by the NCUA.
For current rates on all products, please visit publicservicecu.org/rates