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New Raise-My-Rate CD Option

The New Raise-My-Rate CD Option and How It Works

First, what is a certificate?
A certificate, or certificate of deposit (CD), is a savings tool with a fixed interest rate that’s usually higher than a regular savings account. Your money stays in the certificate account for the duration of the term, generally between one to five years. Interest is paid quarterly and is added to your balance, compounding the interest over time. But if you needed to withdrawal the money before the end of the term, a penalty is assessed. See what certificates Listerhill has available.
The interest rate of a certificate is fixed at the time it is opened which guarantees your return at that rate no matter if they rise or fall from that point. However, when rates increase during the term of your certificate, you may be left feeling like your money isn't earning all it could. This is where a raise-my-rate (also referred to as a bump-up option) can come in handy and allow you to cash in on rising rates. At Listerhill, all our certificates now automatically come with this one-time option to increase your interest rate.


How does raise-my-rate option work?
A raise-my-rate option on a certificate gives you the option to boost its annual percentage yield without changing the terms. This is especially helpful when the certificate interest rates rise beyond your certificate's original rate. But when is the right time to use this option? How long should you wait when rates are rising? Without the gift of hindsight, there's no right or wrong answer as to when you should use this one-time option to raise your rate. Certificate rates rise and fall often and are dependent on many factors including the Federal Reserve's interest rate and the financial climate. However, let's review an example to help explain.


What's the cost?
At Listerhill, there is no cost to use this feature. In fact, we're paying YOU through a higher interest on your savings.


Raise-my-rate certificate example
Let's say you have $10,000 set aside for bathroom renovations. However, you may not plan to begin renovations for another few years. You decide to park the money in a 3-year certificate where, at the time, rates for that term were 1.00%. This is a fixed rate that will guarantee your return of 1.00% for the length of the term.
But maybe one year into your 3-year, 1.00% certificate, interest rates increase dramatically and the same 3-year certificate you got just one year ago is now being offered at a rate of 2.00%. However, you'll still earning a fixed 1.00% for another two years. And if you were to withdraw the money before the term is up, you may have to pay an early withdrawal penalty that would deplete most of the gains earned so far.
But now, with the raise-my-rate feature, you have the one-time option to request your certificate's interest rate to be readjusted to the new rate, in this example, from 1.00% to 2.00%. Because you're clever and informed, you then decide to call and use this feature. Now your certificate is earning 2.00% for the next two years rather than the original 1.00%, all without extending the terms or paying a fee! That's an additional $200 in interest over the remainder of the term. Turns out, that simple phone call just paid for the paint in your new bathroom, great job!
Click to learn more about savings options at Listerhill and how we're building our financial products to best serve our members.

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Frequently Asked Questions

  • What if I get an error message when I try to enroll an email address or U.S. mobile number?

    Your email address or U.S. mobile phone number may already be enrolled with Zelle® at another bank or credit union. Call our member support team at 256.383.9204 and ask them to move your email address or U.S. mobile phone number to your financial institution so you can use it for Zelle®.

    Once customer support moves your email address or U.S. mobile phone number, it will be connected to your bank account so you can start sending and receiving money with Zelle® through your Listerhill Credit Union banking app and online banking. Please call our member support team at 256.383.9204 for help.

  • Is my information secure?

    Keeping your money and information safe is a top priority for Listerhill Credit Union. When you use Zelle® within our mobile app or online banking, your information is protected with the same technology we use to keep your bank account safe.

  • I'm unsure about using Zelle® to pay someone I don't know. What should I do?

    If you don't know the person, or aren't sure you will get what you paid for (for example, items bought from an online bidding or sales site), you should not use Zelle® for these types of transactions.

    These transactions are potentially high risk (just like sending cash to a person you don't know is high risk). Neither Listerhill Credit Union nor Zelle® offers a protection program for any authorized payments made with Zelle® – for example, if you do not receive the item you paid for or the item is not as described or as you expected.

  • Will the person I send money to be notified?

    Yes! They will receive a notification via email or text message.

  • How long does it take to receive money with Zelle®?

    Money sent with Zelle® is typically available to an enrolled recipient within minutes.3

    If you send money to someone who isn't enrolled with Zelle®, they will receive a notification prompting them to enroll. After enrollment, the money will be available directly in your recipient's account, typically within minutes.3

    If your payment is pending, we recommend confirming that the person you sent money to has enrolled with Zelle® and that you entered the correct email address or U.S. mobile phone number.

    If you're waiting to receive money, you should check to see if you've received a payment notification via email or text message. If you haven't received a payment notification, we recommend following up with the sender to confirm they entered the correct email address or U.S. mobile phone number.

    Still having trouble? Please contact our member support team at 256.383.9204.