Since your money is insured, the only risk you are assuming is the potential of foregoing a higher rate of return if interest rates increase.

When money is placed into a fixed rate CD/share certificate, it's locked in a particular rate of return until maturity. The longer it takes for the certificate to reach maturity, the higher the interest rate paid, because you are assuming risk by being locked into a certain rate over a longer time.

For example, suppose you purchase a three-year certificate paying 3 percent interest, the then prevailing market interest rate for certificates of similar maturity. But suppose the interest rate crept up to 4 percent after you purchased the certificate. Your CD/share certificate would be paying less than the newly issued certificates now paying 4 percent.  However, suppose rates went down to 2% and your investment would continue to pay 3%.

For more information on our CDs/share certificates select the link below.  To purchase a certificate from Connection, please Contact Us today!