Building wealth is something everyone aspires to. It’s easier if you have the right financial tools at your disposal.
One such tool is a Term Share Certificate. It’s a secure and stable way to grow your investment. These shares also provide higher interest rates, which is always a win when investing.
You need all the relevant information before investing, though. This post will help you understand a term share certificate and why it should be part of your financial strategy.
What is a Term Share Certificate?
A Term Share Certificate is a financial commodity offered by credit unions. It allows members to deposit money for a fixed period or term. Members get guaranteed returns in exchange. It’s akin to a Certificate of Deposit but offered by a credit union instead of a bank.
The process of opening a Term Share Certificate is pretty straightforward. You will deposit a certain amount, which is the principal. You’ll agree to leave the money untouched for an agreed duration. This can last anywhere from several months to a few years.
Your shareholder certificate will earn a fixed interest rate during the specified term. You’ll get your original deposit back once it reaches the maturity date. The credit union will also release your investment’s accrued interest.
What are the Benefits Offered by Term Share Certificates?
A Term Share Certificate is a great investment because it offers many advantages. It’s especially beneficial to people who want to grow their savings safely. Here are some benefits stock share certificate holders often enjoy:
- Higher Than Average Interest Rates
Credit unions often offer higher-than-average interest rates for Term Share Certificates. Better interest means your money will grow faster.
- Guaranteed and Predictable Returns
People will tell you there are no guarantees when it comes to investing. A term shareholder certificate is the closest you’ll get to guaranteed returns.
You’ll determine the investment amount and duration with a term share certificate. You’ll even choose the interest rate. Everything’s finalized and locked in once you make a deposit. You’re guaranteed a return if you keep your investment untouched for the full term. You’ll even know how much you’ll receive since it’s a fixed interest rate.
This predictability and stability is why term share certificates are popular. They’re also great for financial planning since you know how much your investment is earning.
- Unmatched Safety and Security
Savvy investors prefer term share certificates because they’re safe and secure. They’re insured by the National Credit Union Administration (NCUA) for up to $250,000.
- Term Options That Align with Your Needs
One of the best things about term share certificates is you decide the terms. You can opt for a term as short as 3 to 6 months. You can also choose to go with a lengthy 48 to 72 months. The catch is you’ll have to agree not to access the funds during that specific term.
This flexibility is a boon. For example, you can go with a three-month term because you know rates will rise during that period. You can also choose a shorter term because you plan on buying something in the future. If you’re the patient sort, you can opt for a longer term and get higher returns. That’s the rule of thumb in investing.
- Great for Setting Specific Goals
A term stock share certificate is ideal for saving towards a future goal. You can use it to invest and save money for a world tour or a home renovation. It’s also an ideal method for building your emergency fund.
A term share certificate provides you with a disciplined approach to savings. It’s safe, has higher returns, and offers predictable growth.
Stay Ahead of Your Investments
Do you want to keep up with the world of finance? Legacy Stock Transfer can help you do that and more. We are a family-owned business with clients that trust us since 1996. Our company is always unmatched when it comes to stock transfer solutions. We customize them to fit the client’s distinct requirements. Our team specializes in shareholder forms and registry services. We can issue new stock certificates and replace lost ones. You can also rely on us to maintain your records and act as your proxy. You can contact us here or at 972-612-4120. Let’s work together to secure your financial goals.