bank rates

Save Now For Next Christmas?

Holiday savings clubs allow you to put money away now to save for the holidays.Let’s assume you’ve already paid off your holiday bills.

That means it’s time to start thinking about next Christmas.

Is a holiday savings account right for you? It depends.

Holiday savings accounts (sometimes called Christmas club accounts) let you stockpile money over the course of a year. These accounts — offered at a limited number of banks and credit unions — sometimes pay a higher interest rate than a standard savings account.

But you’ll find there are more restrictions than a standard savings account that impact how much money you can earn.

We found a good deal at Spokane Federal Credit Union ( in Washington, which pays 2.02% APY.

That’s a much higher rate than you’d earn with the best nationally available savings account — 1.10% APY offered by UFB Direct (

With the Spokane FCU deal, you can open the account with any amount up to $1,000 and then add up to $1,000 each month through automatic payments or payroll deductions.

If you start Feb. 1 and make $1,000 monthly deposits until the money is deposited into your regular share account Nov. 1, you’ll have set aside $9,000, plus earned interest of about $75.

This account works much like a CD in that you can’t make withdrawals before maturity or you’ll forfeit the interest you’ve earned. And the rate is guaranteed until your deposit rolls into your regular share account.

Unlike most CDs, you can add money to your account each month.

What kind of saver would benefit?

The $1,000 monthly deposit limit could cut into your earnings if you have more cash to invest upfront.

In the case of the UFB Direct account, you’d earn about the same — $75 — if you put all $9,000 into an account on Feb. 1 and removed it Nov. 1.

But if you found a local savings account that pays more than the best nationally available saving rates, you’d lose earning power when compared to the holiday savings club account if you had more money to invest now.

Indeed, these types of accounts are for people who might not have immediate access to a bundle of cash but who can save over time.

The Spokane FCU account is a better deal for slow-but-sure savers, as you’d earn less putting money into a regular savings account every month.

If you live in the Spokane area, there are several ways to join this credit union.

Spokane FCU is open to anyone who works for the U.S. government in about a dozen counties in Washington and a couple of locations in Idaho as well as certain state and local government employees, military members stationed in the area and those who work for a wide range of other employers. This is detailed on the credit union’s website.

Anyone who lives, works, worships or volunteers in downtown Spokane also is eligible to join.

You can open a holiday club account in person or by phone. The credit union has three locations in Spokane.

See how this account compares to the best savings and money market account rates from scores of banks in our database.

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Comments (4)
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4 Existing Comments
  1. Kathy at Bankaholic said:
    on February 13th at 09:57 am

    You can still get Spokane Federal’s 2.02% APY holiday account rate (whereas UFB Direct’s best savings rate has dropped to 0.95% APY).

  2. Kathy at Bankaholic said:
    on February 21st at 08:29 am

    Spokane Federal’s holiday rate is still available. (UFB Direct has dropped its savings rate yet again, to 0.90% APY.)

  3. Kathy at Bankaholic said:
    on February 23rd at 10:48 am

    UFB Direct’s rate has dropped again, to 0.90% APY.

  4. Kathy at Bankaholic said:
    on March 5th at 10:11 am

    Spokane Federal’s holiday account rate is still available.