Financial Products

Savings Account
Online Savings Account
Certificate of Deposit (CD)
U.S. Savings Bond, Series EE
U.S. Savings Bond, Series I
Money Market Account

Type of Product SAVINGS ACCOUNT (bank); SHARE ACCOUNT (credit union)
Minimum Initial Deposit Usually $25-100 but make certain monthly fees are not charged for small balances
Yield Usually .2-.5%
Safety Government-insured*
Access to Funds Immediate
Where to Purchase At any bank, thrift, or credit union
How to Purchase In person, online, or by phone
How to Make Deposits Through tellers, ATMs, or automatic monthly transfer from checking account
Other Features At many institutions, minimum balance of $100-500 is required to avoid monthly fees or automatic transfers of $5 - $25 a month.
Summary

A savings account is a bank or credit union account specifically designed to hold money that you are saving for the future. You can use your savings account to save money for short or long-term goals. For example, you can keep $500 in your savings account as a rainy day fund or you can save money for a down payment for a house by opening a savings account that yields modest interest and contributing to the account each time you get paid.

Your savings account is not intended for daily use. Many savings accounts are limited to six transactions a month. This means that if you withdraw money from your savings account too often, you could be charged a fee.

Like checking accounts, deposit amounts up to $250,000 are insured by the U.S. Federal Deposit Insurance Corporation (for banks) or the National Credit Union Administration (for credit unions). It is a risk-free way to save because your account balance will not decrease, like it can with investment accounts.

A savings account opened through a credit union is often called a share account.  

 

 

Type of Product Online Savings Account
Minimum Initial Deposit As low as $1 at some institutions
Yield Usually 1-2%
Safety Government-insured*
Access to Funds Immediate
Where to Purchase At any bank, thrift, or credit union
How to Purchase In person, online, or by phone
How to Make Deposits By transferring money from a checking account, or through direct deposit.
Other Features Confirm that the online institution is insured.
Summary

An online savings account is a savings account that you can access on the Internet, and sometimes only online. Online-only banks often offer competitive interest rates.

It’s now standard for banks and credit unions to offer you access to your savings account from your mobile device or computer. You can often transfer money to and from your online savings account with the click of a button, or deposit checks using the camera feature on your phone.

While an online savings account gives you easy access to your funds, it is not intended for daily use. Many savings accounts are limited to six transactions a month. This means that if you withdraw money from your savings account too often, you could be charged a fee.

 

Type of Product CERTIFICATE OF DEPOSIT (bank); SHARE CERTIFICATE (credit union)
Minimum Initial Deposit 
At most institutions, at least $500
Yield Usually 1-2%
Safety Government-insured*
Access to Funds Immediate but interest penalty
Where to Purchase At any bank, thrift, or credit union
How to Purchase In person, online, or by phone
Other Features Certain financial institution will notify you when CD matures
Summary

A Certificate of Deposit is a savings account that has a fixed interest rate and fixed date of withdrawal. Often certificate accounts offer higher interest rates than traditional savings accounts. The trade off is that certificate accounts restrict you from accessing your savings until a certain date. For example, if you opened a five-year certificate account in 2018, you would not be able to withdraw money from the account until 2023 without paying a penalty, and if you withdrawal after that date you may earn a much lower interest rate. The money you save in your certificate account will accrue interest at the fixed rate you receive when you open the account for the term of the certificate.

Typically, banks offer certificate accounts through a certificate of deposit (commonly known as a CD) and credit unions through a share certificate.

 

Type of Product U.S. SAVINGS BOND, SERIES EE
Minimum Initial Deposit As low as $25 ($50 for payroll deduction)
Yield Usually 1.5%
Safety Government-guaranteed
Access to Funds After first 12 months, immediate access but loss of 3 months interest
Where to Purchase From the U.S. Treasury
How to Purchase

Through www.treasurydirect.gov - where savers can buy electronic (no paper) savings bonds with checking account deductions, 24/7.

How to Make Deposits www.treasurydirect.gov allows periodic deposit or checking account deductions to purchase bonds
Other Features Must cash in after 30 years or no more interest earned; face value of bond twice the purchase price ($50 bond costs $25)
Summary

A U.S. Savings Bond, Series EE is a savings certificate issued by the U.S. government, rather than a financial institution, that can accrue interest for up to 30 years. You can buy an EE Savings Bond online at TreasuryDirect.com. All savings bonds purchased after May 2005 earn interest at a fixed rate. The earned interest is compounded, or added to the bond, each month and paid when you cash the bond.

You can cash your savings bond at any paying financial institution after one year of ownership. If you redeem the value of your savings bond before five years, you will lose the interest earned on it for the past three months.

For more information, click here.

 

Type of Product U.S. SAVINGS BOND, SERIES I (with inflation protection)
Minimum Initial Deposit As low as $25
Yield Usually 0-2%
Safety Government-guaranteed
Access to Funds After first 12 months, immediate access but loss of 3 months interest
Where to Purchase Through www.treasurydirect.gov - where savers can buy electronic (no paper) savings bonds with checking account deductions, 24/7.
How to Purchase Through www.treasurydirect.gov - where savers can buy electronic (no paper) savings bonds with checking account deductions, 24/7.
How to Make Deposits EASY SAVER program allows periodic payroll deposit or checking account deductions to purchase bonds
Other Features Must cash in after 30 years or no more interest earned
Summary

A U.S. Savings Bond, Series I is an electronic savings vehicle that earns interest at variable rates. As of May 9, 2018, U.S. Savings Bonds earn interest at a rate of 2.52 percent. The earned interest is compounded, or added to the bond, each month and paid when you cash the bond.

You can purchase a U.S. Savings Bond, Series I online at TreasuryDirect.com. You can purchase a paper savings bond when you file your income taxes.

You can redeem the value of your savings bond after one year of ownership. Your bond can earn interest for up to 30 years. If you redeem the value of your savings bond before five years, you will lose the interest it earned for the previous three months.

To learn more, click here

 

Type of Product Money Market Account
Minimum Initial Deposit As low as $250 at some institutions
Yield Usually .1-.3%
Safety Government-insured*
Access to Funds Immediate
Where to Purchase In person, online, or by phone
How to Purchase Money market fund
Summary

A money market account is a type of savings account that often yields interest at a higher rate than a standard savings account. To open this type of account, you usually have to maintain a higher balance than the standard savings account.

You can open a money market account or fund. A money market fund is an investment vehicle that is not insured by the FDIC, while a money market account is similar to your standard savings account.

You should place the savings you want to access easily in your money market account rather than your money market fund. The interest rate on your money market account will vary depending on the investments available to the bank you’ve opened your account with.

Some money market accounts require you to wait a certain amount of time before you can make a withdrawal. Your money market account will also usually have a six-time monthly withdrawal limit.

 

 

* Accounts at some credit unions are privately insured.

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