Save money to earn money!
One great reason to save money at Visions: dividends!* Your deposits in savings accounts earn a percentage back over time, and we offer excellent, competitive rates for our members.
You'll notice our savings rates, including Share Certificates and Flex Money Market accounts, are always advertised with APY, or Annual Percentage Yield. You may also notice that in some instances, like our rates pages, we include the interest rate or dividend rate, too.
Below is some information to help you better understand your savings accounts and related earnings at Visions.
APY vs. Dividend Rates
Credit unions are required by regulation to state the rates of return on all savings accounts in terms of APY, or Annual Percentage Yield. This requirement ensures that you’re getting comparable figures from all credit unions – advertised fairly, consistently, and without deception. It’s one of the many ways we aim to be transparent and accountable to our members.
APY – expected earnings
This number is an annual rate that forecasts annual earnings for a savings account. Given as a percentage based on the account balance, APY is a projection that represents the expected amount of earnings after dividends accrue and compound for a full year.
Dividend Rate – active interest
The dividend rate is an annual rate of return used to calculate daily and monthly earnings for a savings account. Given as a percentage based on the account balance, this rate is active on the savings account, accruing interest daily based on the average daily balance, and compounding monthly.
By knowing your accounts' dividend rates, you'll have a more accurate expectation for your monthly earnings, which are reflected on your monthly statements as dividend deposits.
The big difference between the APY and dividend rate is the compound interest.
Here's an example* that demonstrates the relationship between the two rates.
Given an initial balance of $50,000, let’s track one year of dividends at 2.25% APY, which earns a dividend rate of 2.23%.
| Duration | Balance | New Dividends | Total Earnings |
|---|---|---|---|
| 0 months | $50,000 | $0 | $0 |
| 1 month | $50,092.92 | $92.92 | $92.92 |
| 2 months | $50,186.01 | $93.09 | $186.01 |
| 3 months | $50,279.27 | $93.26 | $279.27 |
| 4 months | $50,372.71 | $93.44 | $372.71 |
| 5 months | $50,466.32 | $93.61 | $466.32 |
| 6 months | $50,560.10 | $93.78 | $560.10 |
| 7 months | $50,654.06 | $93.96 | $654.06 |
| 8 months | $50,748.19 | $94.13 | $748.19 |
| 9 months | $50,842.50 | $94.31 | $842.50 |
| 10 months | $50,936.98 | $94.48 | $936.98 |
| 11 months | $51,031.64 | $94.66 | $1,031.64 |
| 12 months | $51,126.47 This total is the approx. balance after one year of dividend deposits. |
$94.83 This column contains monthly deposits at 2.23% Dividend Rate. |
$1,126.47 This final total represents the return at 2.25% APY. |
The chart illustrates how dividends are credited monthly – and how they compound over the course of a full year. Although the dividend rate in the example (2.23%) appears lower than the APY (2.25%), the account accrues enough compounded dividends after 12 months to produce the projected APY ($1,126.47 is approximately 2.25% of $50,000).
For our current savings rates, please visit.visionsfcu.org/rates.
Explore your savings potential using our savings calculators
Learn about your share insurance for deposits at Visions.
*Please note, these numbers are examples only, used for illustrative purposes. It’s also helpful to note that savings accounts at Visions accrue dividends based on the number of days in the month. E.g.: January accrues for 31 days, February accrues for 28 days, etc. As a result, an account’s dividend deposits may be higher for January than February, even if that same account has a slightly higher daily balance in February.
Dividends are calculated by the average daily balance method which applies a periodic rate to the average daily balance in the account for the month. The average daily balance is determined by adding the ending balance for each day and dividing the total by the number of days in the month. Dividends begin to accrue on the business day funds are received in your account and will accrue through the day prior to withdrawal.
If you close your dividend bearing account before dividends are credited on the last calendar day of the month, you will not receive accrued dividends.
