OnPath Credit Union

Wealth Builder accounts – also sometimes called high-yield savings accounts – are special savings accounts that earn a guaranteed dividend rate and annual percentage yield (APY) if minimum balance requirements are met.

Saving in a Wealth Builder account is a great way to harness the power of compound growth without having to risk your money investing in the stock market or keeping your money in an illiquid savings vehicle like a share certificate.

Does that make Wealth Builder accounts better than share certificates? No – just different. Many banking customers could benefit from using both accounts – a Wealth Builder account for liquid savings that can be accessed if the need were to arise and share certificates for longer-term growth.

The Important Features of a Wealth Builder Account

Higher Than Normal Interest Rates

Typical savings accounts do pay interest – the rate is just so low it’s almost imperceptible (often around 0.05 to 0.2 percent APY). High-yield savings accounts at banks may have slightly higher interest rates, often around 0.5 percent APY, but they usually don’t match the one percent or higher APY you could get from a credit union Wealth Builder account.

The dividend rates of OnPath Federal Credit Union Wealth Builder accounts change over time depending on national interest rates but are often between one and two percent APY. Visit our rates page to learn about current Wealth Builder savings rates and share certificate rates.

Liquidity

A Wealth Builder account is essentially a savings account that pays higher interest. They usually function the same as any other savings account. In order to earn higher dividends, you must meet certain minimum balance requirements. Unlike a share certificate, there are no restrictions on when you can withdraw money, and there’s no penalty for doing so other than potentially losing the higher dividend rate for falling below the minimum balance threshold.

Safety

Like all accounts at OnPath Federal Credit Union (and all credit unions insured by the National Credit Union Administration), your account is insured up to $250,000. This makes saving in a credit union extremely safe. These unique savings opportunities are virtually risk free up to the insured amount.

Can be Automated for Effortless Savings

Sticking to a long-term savings plan isn’t always easy. Setting up automatic deposits makes it far easier to put money away in a Wealth Builder account each month.

Is a Wealth Builder Account Right for You?

Build an Emergency Fund

Financial experts and advisors often encourage people to set aside three to six months’ worth of living expenses to deal with any unexpected emergencies that might arise. Medical issues, car accidents and job losses are just a few examples of things that happen to people in New Orleans every day.

A Wealth Builder account is a great option for a rainy-day fund because it’s far more liquid than a share certificate, offers better growth than a regular savings account and is separate from the normal funds you keep in a checking account for regular expenses.

Reach Your Savings Goals

Setting up a separate savings account for a specific purpose, like buying a new car, going on a vacation, paying for college or a home downpayment, can make it easier to meet your financial goals. You may be less tempted to touch that money or accidentally spend it if the funds are siloed off in their own account. Plus, those dollars will grow much faster than they would in a regular savings account or your checking account.

Put Compound Growth to Work for Your Future

If you’re looking for a safe place to save money for retirement that doesn’t carry the same risks as investing in the market, real estate or some other venture, a Wealth Savings account may be the ideal option. In addition to benefiting from compound growth, you’ll also retain access to those funds in a way that’s not possible with those other types of long-term investments, many of which can’t be easily sold or turned into cash quickly without taking a loss or penalties. 

Learn More About Wealth Builder Accounts in New Orleans

If you like the idea of earning a higher rate of return on your savings from a share certificate, but don’t like the inability to access your funds, a Wealth Builder account is the perfect alternative. You get a significantly higher rate of return than you would with a regular savings account while not being restricted from accessing the funds in an emergency.

Check our rates page to learn more about our Wealth Builder account options or call the OnPath Federal Credit Union team at 800.749.6193 to learn about this powerful saving tool.