Is a CD a Good Choice for Your Savings Goals




At Polam, we offer our members a number of different ways to save money and invest in their future. Our Vantage savings accounts are designed to work with any level of saver, and our traditional IRA accounts are designed to help our members save for retirement. However, many members choose a certificate of deposit (CD) account to save money, which allows them to earn dividends on the money they save for terms ranging from six months up to 36 months. CDs are a low-risk way for our members to earn a higher interest rate on the money they would normally keep in a traditional savings account, and are a great choice for anyone who has already built up a small savings that they can deposit into one of these accounts.


Is a CD a right choice for you? Here are a few things to consider:


  • Do you have an existing savings account or money set aside?  Polam’s CDs require a minimum opening deposit – $5,000 – so if you don’t already have those funds saved, you should continue to save in your Vantage savings account. Investing in a CD gives you the opportunity to invest cash that you don’t plan on using for a set amount of time, so if you have the money to open an account and want to keep it somewhere secure where it can grow, a CD might be a good choice for you.


  • Do you have the time to keep your savings secured without needing to use them?  Because there can be penalties for early withdrawals of funds, a CD is a smart choice if you have no intention or need to touch your savings for a set amount of time. However, you can decide how long you want to keep your funds in your CD. Generally, the longer the term, the more you’ll save because of the dividends you’ll earn, which is something to keep in mind before making this decision. We offer terms for as short as six months and as long as 36 months, so it’s important to assess when you’ll need to make a withdrawal before committing to opening an account.


  • Do you want to earn more interest on the money you save?  If you want to build on your savings, it’s important to make regular deposits into whichever account you choose; some members choose to set up automatic transfers from their checking account to their savings account. With Polam’s CDs, you’ll be earning interest on what you save, and the longer you keep your money in your CD, the more you’ll earn.