What Is a Share Savings Account?
When you open a savings account at a credit union, it's officially called a "share savings account" or simply a "share account." The terminology comes from the cooperative structure: your deposit represents a share of ownership in the credit union. Every member is required to maintain a small balance in their share savings account (typically $5–$25) as proof of membership.
How Interest Works: Dividends, Not Interest
Credit unions pay "dividends" on share accounts rather than "interest" — though the financial effect is identical. Both are calculated as a percentage of your balance and credited to your account on a regular schedule (typically monthly). The rate is expressed as an APY (Annual Percentage Yield), which accounts for compounding.
Typical Rates
Share savings rates at credit unions vary widely. Smaller, community-focused credit unions may pay 0.05–0.25% APY on basic share savings accounts. Larger or more competitive credit unions may offer 4–5% APY on high-yield savings products during a high-rate environment. Always compare APYs — not just the stated dividend rate — when shopping.
Types of Savings Accounts
- Regular share savings: The basic membership account. Often pays a modest rate but serves as the foundation for membership.
- High-yield savings / premium savings: Higher rates, sometimes requiring minimum balances or direct deposit relationships.
- Money market share accounts: Higher rates tied to balance tiers, with limited monthly withdrawal transactions.
- Holiday/vacation clubs: Earmarked savings accounts with restricted withdrawals to help members save for specific goals.
- Youth savings accounts: Designed for children and teenagers, often with financial education components.
Regulation D and Withdrawal Limits
Federal Regulation D historically limited savings accounts to six withdrawals per month. The Federal Reserve eliminated this limit in April 2020, but many credit unions still impose their own limits (or excess transaction fees). Check your credit union's policy before relying on frequent transfers from savings.
NCUA Insurance
Share savings accounts are fully covered by NCUA insurance up to $250,000 per member per ownership category. Your money is as safe as it would be in an FDIC-insured bank account.
Frequently Asked Questions
A share savings account is liquid — you can withdraw funds at any time (subject to transaction limits). A share certificate is a time deposit with a fixed term and fixed rate; withdrawing early triggers a penalty. Certificates typically pay higher rates than savings accounts.
Yes. Most credit unions allow members to open additional savings accounts (often called 'sub-accounts' or 'clubs') for specific goals — vacations, emergencies, or major purchases. Each account is separately labeled and may have its own dividend rate.
Many credit unions have no monthly maintenance fee on basic share savings accounts, especially if you maintain the minimum balance. Some premium savings products may have fees that are waived with minimum balance requirements.
You can close your share savings account and withdraw all your funds at any time. Your membership ends when the account is closed.
Find Credit Unions Near You
Search our directory of 4,374 federally insured credit unions by name, city, or state.