Like banks, credit unions offer a special type of savings account where account holders can deposit a lump sum of money for a specified length of time, untouched, as it accrues interest. And, like banks, credit unions offer higher, competitive annual percentage yields, or APYs, to account holders as an incentive for not withdrawing the funds until the maturity date of the account, be it from a few months to five years.
Banks call this type of account a certificate of deposit, or CD. Credit unions call it a share certificate.
Credit unions offer share certificates with rates comparable to those at online banks. What’s more, each credit union member is insured by the National Credit Union Association for up to $250,000 per person.
What is a 1-year share certificate?
A one-year share certificate, like a one-year CD, is a savings account available at a credit union that’s designed to hold a lump sum of cash that’s not to be withdrawn for an entire year. In most cases, if any money is withdrawn before the maturity date has passed, the credit union will impose an early withdrawal fee equivalent to between 90 and 365 days of forfeited dividends.
Like bank CDs, a share certificate can be set to renew automatically. This means that once the maturity date has passed, the term will reset itself unless you withdraw the money or modify the certificate during its grace period, which is typically seven days.
CNET’s picks for the best 1-year share certificate rates
The share certificates listed below earn rates that are more than four times the average one-year share certificate rate of 0.91%.
Best 1-year share certificate rates
| Credit union name | APY | Minimum deposit |
|---|---|---|
| Conexus Credit Union | 4.51% | $5,000 |
| PenFed Credit Union | 4.25% | $1,000 |
| Alliant Credit Union | 4.20% | $1,000 |
| Department of Commerce Federal Credit Union | 4.19% | $500 |
| Freedom Credit Union | 4.08% | $500 |
| America First Credit Union | 4.00% | $500 |
| Bethpage Federal Credit Union | 4.00% | $50 |
| Members First Credit Union | 4.00% | $500 |
| Lake Michigan Credit Union | 3.90% | $500 |
| Navy Federal Credit Union | 3.75% | $1,000 |
Note: Annual percentage yields, or APYs, shown are as of Dec. 2, 2022. CNET’s editorial team updates this information regularly, typically biweekly. APYs may have changed since they were last updated and may vary by region for some products.
More details on the best 1-year share certificate rates
Connexus Credit Union
Read Connexus Credit Union Review- APY
- 4.51%
- Min. deposit to open
- $5,000
- Term
- 1-year
Connexus is part of the CO-OP Shared Branch network which offers members 5,600 shared branch networks. Connexus makes it easy to become a member (visit the company’s website to learn more about eligibility). Share certificate accounts earn highly competitive rates. Membership is broadly available with a $5 one-time donation to the Connexus Association.
Early withdrawal penalty: 90 days dividends on the amount withdrawn
PenFed Credit Union
- APY
- 4.25%
- Min. deposit to open
- $1,000
- Term
- 1-year
Pentagon Federal Credit Union, or PenFed for short, offers membership that’s available to everyone. It offers a full suite of deposit accounts. PenFed’s free checking account offers 85,000 fee-free ATMs, more than many of the largest US banks. A mobile app makes it possible to facilitate banking transactions from anywhere.
Early withdrawal penalty: The amount of dividends earned up to the time the money is withdrawn, up to 365 days.
Alliant Credit Union
Read Alliant Credit Union Review- APY
- 4.20%
- Min. deposit to open
- $1,000
- Term
- 1-year
Alliant Credit Union is an online credit union with competitive rates, a full suite of financial products and broad membership eligibility. Membership is open to current or former employees of Alliant’s US partner businesses. Visit Alliant for a complete list of businesses and how you can qualify.
Early withdrawal penalty: Dividends equal to the number of days the certificate has been open, up to 90 days.
Department of Commerce Federal Credit Union
- APY
- 4.19%
- Min. deposit to open
- $500
- Term
- 1-year
Membership in the Department of Commerce Federal Credit Union is open to residents who live in Washington, DC, the organization’s employees, family members or those who join the American Consumer Council. More details regarding membership eligibility are available here. Members of the Relationship Reward program can earn an additional 0.05% to 0.25% APY based on point values. Deposits of $25,000 or more earn an additional 0.10% APY.
Early withdrawal penalty: 90 days of interest
Freedom Credit Union
- APY
- 4.08%
- Min. deposit to open
- $500
- Term
- 1-year
Freedom Credit Union is a Philadelphia-based, full-service banking alternative. Membership is open to residents of specific counties in Pennsylvania. Share certificates are available in terms ranging from six months to five years. A youth certificate is available for people ages 25 and younger that only requires a $250 minimum deposit.
Early withdrawal penalty: Three months of dividends
America First Credit Union
- APY
- 4.00%
- Min. deposit to open
- $500
- Term
- 1-year
America First provides certificate accounts with terms in monthly increments ranging from three to 60 months (five years). Unlike most financial institutions, this credit union doesn’t charge an early withdrawal fee on its two types of certificate accounts -- standard and bump-up. Membership is available to residents of certain states in the southwestern US. Visit the website for a complete list of eligibility requirements.
Early withdrawal penalty: No fee
Bethpage Federal Credit Union
- APY
- 4.00%
- Min. deposit to open
- $50
- Term
- 1-year
Bethpage Federal Credit Union offers a full suite of financial services including digital banking features with several options for free checking and savings accounts. There are no fees for either checking or savings accounts and membership is broadly available with a $5 one-time donation. Share certificates are available in 10 terms including a bump-up certificate.
Early withdrawal penalty: 90 days of dividends on the principal amount withdrawn
Members First Credit Union
- APY
- 4.00%
- Min. deposit to open
- $500
- Term
- 1-year
Members First offers a variety of certificate terms ranging from six to 36 months. All of the certificates pay quarterly dividends and require a $500 minimum deposit to open. The standard certificates permit a one-time rate increase during the term. That’s an unusual benefit that most banks or credit unions don’t provide for the highest yielding CDs.
Lake Michigan Credit Union
- APY
- 3.90%
- Min. deposit to open
- $500
- Term
- 1-year
Lake Michigan Credit Union share certificates range from three to 60 months. Account holders can earn an additional 0.25% APY with a VIP-level MORE Reward Program status. Membership is open to all US citizens. Those living outside of Michigan or Florida, you can join by donating $5 to the ALS Foundation.
Early withdrawal penalty: 180 days of interest
Navy Federal Credit Union
Read Navy Federal Credit Union Review- APY
- 3.75%
- Min. deposit to open
- $1,000
- Term
- 1-year
Navy Federal Credit Union offers membership to anyone affiliated with the armed services, the Department of Defense or the National Guard. There are four types of share certificate accounts with terms ranging from three months to seven years. The standard certificate offers the 3.70% APY rate. The mobile app provides digital banking services that allow access to the account across the country.
Early withdrawal penalty: Up to 90 days of dividends
FAQs
A share certificate is just like a CD in that it’s a deposit account with low risk in which your money grows at a fixed rate for a specified period of time. The difference is that share certificates are offered by credit unions, while CDs are offered by banks. Earnings on share certificates are referred to as dividends. Credit unions are not-for-profit, which means profits are distributed as dividends among its members, or shareholders. Dividends are synonymous with yields for CDs.
A one-year share certificate from a credit union is a savings product that offers higher rates of interest than traditional savings or money market accounts in exchange for agreeing to keep the funds in the certificate, untouched, for one year. A one-year share certificate is a safe investment option that earns a fixed-rate APY.
First, understand the various types of share certificates to determine which one works best for your financial needs. Most credit unions offer share certificates with fixed terms from three months to five years, generally have strict maturity dates and don’t allow you to modify the initial deposit after opening. However, specialty certificates offer flexibility in some of all of these areas. The rates may differ. When looking for either a standard or specialty CD, make sure that a one-year term is available at your credit union of choice.
Compare the distribution rate and APY to find the highest paying options. Then, determine if there’s a minimum deposit required. Next, select the fixed length of time, or term, that you want to purchase. The term should be no longer than when you estimate you’ll need to access the funds to avoid any early withdrawal penalty. Finally, you’ll need to understand if the share certificate offers an automatic renewal process only or lets you opt out to manage that process manually. In some cases, a share certificate will also allow you to determine when interest is dispersed.
Fees vary depending on the credit union. Some advertise no fees. Others charge a fee if the account is closed before a set time has elapsed. Most share certificates charge a penalty for withdrawing money before the maturity date has passed. The fee is generally based on a percentage of the interest earned.
One-year share certificates purchased from a credit union are insured by the National Credit Union Administration, or NCUA, for up to $250,000 per person. Any distributions are also covered by the NCUA. Otherwise, you shouldn’t worry about losing your principal balance.
Share certificate terms generally vary from three months to five years. Like bank CDs, share certificates with longer terms pay higher distribution rates. Additionally, there are other safe savings accounts to consider, such as high-yield savings accounts and I bonds.
Methodology
CNET Reviews CD rates based on the latest APY information from issuer websites. We evaluated CD and share certificate rates from more than 50 banks, credit unions and financial companies. We selected the share certificates with the highest APY for one-year terms from among the credit unions we surveyed, and considered rates for shorter terms if one-year terms were identical or unavailable.
Banks and credit unions surveyed include: Alliant Credit Union, Ally Bank, America First Credit Union, American Express National Bank, Axos Bank, Bank of America, Bank of the West, Bank5 Connect, Barclays, BMO Harris, Bread Savings, BrioDirect, Capital One, CFG Community Bank, Citizens Access, Colorado Federal Savings Bank, Connexus Credit Union, Consumers Credit Union, Credit One Bank, Discover Bank, First Internet Bank of Indiana, First Tech Federal Credit Union, FNBO Direct, GO2bank, Golden 1 Credit Union, HSBC Bank, Huntington Bank, Lake Michigan Credit Union, LendingClub Bank, Live Oak Bank, M&T Bank, Marcus by Goldman Sachs, Merrick Bank, Nationwide (by Axos), Navy Federal Credit Union, NBKC, OneUnited Bank, Pentagon Federal Credit Union, PNC, Popular Direct, PurePoint Financial, Quontic Bank, Rising Bank, Salem Five Direct, Sallie Mae Bank, Santander Bank, SchoolsFirst Federal Credit Union, Synchrony Bank, TAB Bank, TD Bank, TIAA Bank, Truist Bank, U.S. Bank, UFB Direct, Union Bank, USAA Bank, Vio Bank, and Wells Fargo.
The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.
