What happens when your certificate matures?

When it comes to you and your financial goals, chances are they probably change periodically depending on your current situation. When you have long-term savings goals, you might choose to open a certificate (also known as a certificate of deposit or CD). But what happens when that certificate matures? The good news is that you have a variety of options depending on your needs!

What does it mean when a certificate matures?

Certificates are savings accounts with a fixed rate and a fixed term. When you open a certificate, you deposit a certain amount of money and lock in a set interest rate for a defined period of time, which is known as the term. These terms can range from days to years. When your certificate reaches the end of its term, it matures. Most certificates will automatically renew into a similar term, but you have the option to withdraw your money at maturity.

If you withdraw money before the maturity date, early withdrawal penalties may apply and could reduce earnings.

Options for a certificate at maturity

You have three main options when your certificate matures. At Centra, you have a grace period following your certificate’s maturity date to make any changes. The grace period for our 7-day certificate is two days while the grace period for other certificates is 10 days. To request a change, you can chat with us at Centra.org, send us a message in digital banking, give us a call at 800-232-3642, or visit your nearest Centra location.

Renew your certificate

Certificates at many financial institutions, including Centra Credit Union, will automatically renew into a certificate with the same or a similar term. When the certificate renews, the current rate for that term will be locked in. If you have a certificate at Centra, you’ll receive a notice before your certificate matures with information about the term and your balance. You can then check our current deposit rates to see your updated rate for the next term.

No action is required to rollover the entire balance (including the principal and dividends) into the specified renewal term. If you’d like to change the amount of your deposit during your certificate’s grace period, you can contact us.

Reinvest in a new certificate

When your certificate matures, the rate environment or your financial goals might be different than when you originally opened your certificate. As a result, you might choose to reinvest your money into a new certificate with a different rate or term. For example, if you’re saving for a future vacation, you might choose a shorter or longer term based on when you plan to travel. You can also change the amount of your deposit when choosing a new certificate.

Withdraw your money for other options

Certificates are a great option for a guaranteed return! But if you need more flexibility for deposits and withdrawals, you might choose to move your certificate to another account, such as a High Interest Money Market or even High Interest Checking. With these accounts, you can make regular deposits and withdraw money as you need it without any penalty. Please note that rates on these accounts are subject to change.

How to decide what to do when a certificate matures

You have a few options for your certificate when it matures, but how do you decide what the next steps should be for that money? There are a few steps you can take to make sure you’re prepared for certificate maturity.

• Review your earned interest. This can help you determine whether you want to reinvest that money to keep growing. If you’re happy with the end amount, you can have that money deposited into your a savings or checking account depending on your needs.
• Evaluate your current financial goals. Are there any new purchases you’re saving up for? Do you have any big expenses coming up? Or, do you need easy access to cash for an upcoming repair? Understanding your current goals can help you decide if a long-term investment is right for you. Looking for other investment options? Centra Financial Services can help.
• Decide whether to reinvest or withdraw. Once you’ve considered your financial goals, you can decide whether to let your certificate automatically renew, open a new certificate, or withdraw the money and place it in another account.
• Know your deadline. It’s important to know your certificate’s maturity date and how much time you have to make changes after maturity. At Centra, our 7-day certificate has a two-day grace period while the grace period for other certificates is 10 days. To stay on top of your certificates, you can set up notifications in digital banking.

No matter what option you decide on, we’re here to help you along the way! If you have any questions, feel free to chat with us online, visit a Centra location near you, or call 800-232-3642. To request a change to a maturing certificate, you can chat with us at Centra.org, send us a message in digital banking, give us a call at 800-232-3642, or visit your nearest Centra location.