Deposit Accounts FAQs

As with any investment, the higher the rate of return, the higher the risk. But, there are a few higher-yield investment accounts that have a relatively low risk of loss. Certificates, Money Markets, IRAs, and Mutual Funds are all safer types of investments that generally offer higher returns than a standard savings account.

Money Markets are similar to savings accounts, except they offer higher rates and have the ability to use checks. Typically, Money Market rates are tiered, meaning the higher your balance, the more dividends you’ll receive.

One of the defining characteristics of Certificates is that they offer a higher, guaranteed rate of return. In order to achieve that higher rate of return, certificates have set terms in which you cannot withdraw funds. However, some certificates—like our Smart Saver certificates—allow deposits during the term, enabling you to maximize your investment and generate even more dividends. 

IRAs (Individual Retirement Accounts) and 401(k)s are two of the most popular savings accounts available, set up as a form of deferred income to use after you retire. The biggest differences between the two lie in their tax treatments, investment options, and the eligibility of employer contributions.

401(k)s are employer sponsored, whereas Traditional and Roth IRAs are set up directly between an individual and a financial institution. Because these types of IRAs are chosen by the individual, the investment options are not limited; you can choose the terms, the limits of your contributions, and whether you want your IRA to be taxed before or after withdrawal. Financial advisors often recommend setting up both an IRA and a 401(k) if possible. Consult your financial advisor for advice specific to your situation. 

Choosing a Traditional IRA or Roth IRA all depends on whether you think it's smart to pay taxes now or later. With a Traditional IRA, the money you contribute is not taxed until you withdraw it, whereas contributions to a Roth IRA are taxed when you make them. One of the keys to determining which is better for you lies in whether you think you’ll be taxed in a higher income bracket now or when you retire.

An IRA rollover is an option that allows you to roll your old employer-sponsored retirement account into a new IRA without taking any tax or early-withdrawal penalties.