Lake Michigan Credit Union CD Earnings Calculator
Estimate your returns based on current LMCU Certificate of Deposit (CD) rates.
How to Maximize Your Savings at Lake Michigan Credit Union
Lake Michigan Credit Union (LMCU) is well-known for offering competitive rates on their Certificate of Deposit (CD) products. Unlike a standard savings account, a CD locks your funds for a fixed period in exchange for a higher interest rate, making it an excellent choice for low-risk investment strategies.
Understanding LMCU CD Terms and Compounding
The calculation for your CD earnings depends heavily on the compounding frequency. While many banks compound annually, LMCU often utilizes monthly or daily compounding, which slightly increases your total earnings over time through the power of "interest on interest."
If you deposit 10,000 into a 12-month LMCU CD with an APY of 5.00% compounding monthly, your total interest earned at the end of the year would be approximately 500.00, resulting in a total maturity value of 10,500.00.
Factors That Affect Your LMCU CD Returns
- Minimum Deposit: LMCU typically requires a minimum opening deposit (often $500 or more) to qualify for CD rates.
- Early Withdrawal Penalties: If you need your cash before the term ends, LMCU will charge a penalty, which often equals several months of interest.
- Promotional Tiers: Look for "special" terms (like a 7-month or 19-month CD) that often carry higher rates than standard 1-year or 2-year options.
Frequently Asked Questions
What is the difference between APR and APY? APR represents the simple interest rate, while APY (Annual Percentage Yield) accounts for the effect of compounding within the year. When comparing LMCU rates, always use the APY for an accurate comparison.
Are LMCU CDs insured? Yes, LMCU accounts are federally insured by the NCUA up to $250,000 per depositor, making them as secure as FDIC-insured bank accounts.