While it may say January on the calendar, now is the best time to start thinking about putting money aside for the holidays. A Christmas club savings account is a type of savings account that is available through your local New Bedford CU, which can be used to help start saving money for holiday shopping at the end of the year. Members of the credit union can start making deposits into this account each month as they are able between January and the end of October, which is usually when the money is automatically moved to the primary checking account for easy access.
Unlike a traditional credit union savings account, a Christmas club savings account is not intended for long-term savings, but was designed for a distinct purpose. However, it need not be limited only to Christmas shopping as the title implies, as it may be used for Hanukkah, Kwanza or any other holiday or big event that your family celebrates between November 1st and the end of the year. Some even use it to prepare for Thanksgiving travel or for planning a holiday party for friends and family. What you do with the money in your Christmas club savings account is entirely up to you.
Why Open a Christmas Club Savings Account?
There are many benefits associated with opening this type of savings account at your local New Bedford CU. One is that you never actually see the money in your primary checking or savings account, which makes you less likely to feel inclined to spend it on something throughout the year. Another is that St. Anne Credit Union in New Bedford, as well as all other credit unions that offer this type of account, does not designate this type of savings account as an overdraft protection account. So even if you make an accounting mistake on your Share Checking or Share Savings accounts, this account won’t be used to make up the difference.
Differences Between Christmas Club and Share Savings Accounts
Typically the primary difference between opening up a Christmas club savings account and a traditional Share Savings account is that there are different interest rates for savings accounts depending on their type. Investment type savings accounts, such as a Money Market account, often pay the highest interest rates of savings accounts overall. General savings accounts, such as your Share Savings, will pay average interest rates for savings accounts as determined by the market. However, a Christmas club savings account will usually pay set interest rates for savings, which is lower than the nationwide going rate.
So if your goal is to grow your money, there are better options available to you at your New Bedford CU than a Christmas club savings account. However, if your primary objective is to help yourself save money for the holidays and you don’t necessarily care about high yield interest rates for savings accounts, then this could be the perfect choice and a simple way to reach your savings goals. Speak with your representative at St. Anne Credit Union in New Bedford for detailed information about the ins and outs of opening a Christmas club savings account.
Putting Money into Your Christmas Club Savings Account
There are a couple of ways to put money into your Christmas club savings account at your local New Bedford CU. One is to just walk in, speak to a representative and make a deposit into your account. It’s that easy. Another way is to move your money over from your credit union checking and savings accounts after you receive your automatic deposit payment from your employer. Still another way is to set up automatic transfers of money from your checking or savings into your Christmas club savings account. Speak with an account representative at St. Anne Credit Union in New Bedford to get more details on the available options for putting money into your Christmas club savings account to find the method that is right for you.
The History of the Christmas Club Savings Account
Chances are you remember your mother putting money away at your local New Bedford CU or bank into a Christmas club savings account. While most banks today no longer support this type of savings program, credit unions still offer it nationwide, for the most part. This simple savings program encouraged families to put money away on a weekly or monthly basis to save money for holiday shopping. It was most popular during the 1970s, when nearly every mother would use this method of saving, putting $5 or $10 each week into an account from January until the end of October, just in time for the holiday sales.
According to the CUNA, which is the Credit Union National Association, more than 70 percent of all credit unions in the United States still offer the Christmas club savings account. They claim that consumer interest and participation is still high at the credit unions that offer this savings program. Many financial experts believe that this type of low interest rate savings account is a good way for consumers to learn about small step savings, which has been shown to lead to better saving habits across the board.
Start Saving Now at St. Anne Credit Union in New Bedford
St. Anne is proud to offer the Christmas club savings account opportunity to its members. In fact, a recent study of credit unions in the northeastern states have shown a slight increase in member participation in recent years. Using a Christmas club savings account can help New Bedford CU members save money for holiday shopping and avoid costly interest rates for credit cards and other loans typically taken out around the holiday season. Speak with your representative St. Anne Credit Union in New Bedford to find out more about the entire line of financial opportunities available to members that are designed to help you grow your money, reduce debt and better plan for the future.