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Compare the best Christmas club accounts

Don't rely on a holiday miracle to help you pay for presents in 2021.

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Cassidy Horton
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No matter how far away Christmas may be, a dedicated Christmas savings account could help you prepare for the often-expensive holiday. We narrowed down the best Christmas savings accounts, also known as Christmas club accounts, by considering key factors like incentives to help you save, fees that might get in the way and convenience. Here’s a list of the five best accounts:

5 best Christmas club accounts

Take a closer look at the five best Christmas savings accounts by comparing their pros, cons and features.

Consumers Credit Union Christmas Savings account

Consumers Credit Union Christmas Savings account logo
0.25%
APY
None
Fees
None
Min. opening deposit
  • Automatic savings. Make your next holiday stress-free when you set up automatic deposits each month.
  • Funds available from Oct 1 to Dec 31. Access your funds at any time between October 1 and December 31 of each year. Starting January 1, it locks again to help you save for the next round of holidays.
  • Several ways to open. Visit a local branch, call 800-991-2221 or hop online to open this account.
  • Average APY. This Christmas Savings account earns a higher interest rate than any of Consumers Credit Union's other accounts, but you can find better rates elsewhere.
  • Early withdrawal fee. As with most Christmas club accounts, you'll pay a penalty if you need to access your money before your account matures.
  • Members only. You must be a current Consumers Credit Union member to open this account. If you're not currently a member, you can join by opening a Share Savings account with a minimum $25 deposit.
Interest compounding Monthly
Minimum to earn interest $1
Monthly transaction limit 1
Fee per transaction over limit

Security Service Club Savings Account

Security Service Club Savings Account logo
0.05%
APY
None
Fees
$5
Min. opening deposit
  • Low opening deposit. You only need $5 to open this account and additional deposits are allowed at any time.
  • Automatic transfer on November 1. Your Club Savings account converts to a Basic Savings account on November 1 so you can use your funds for holiday shopping.
  • Online application. You can establish membership and open this savings account without visiting a local branch.
  • Low APY. While this APY is on par with the national average, it's much lower than rates offered by the competition.
  • Membership requirements. SSFCU is open to those who live, work, worship, attend school, volunteer or own a business in Texas, Colorado or Utah, relatives of existing members and those affiliated with Security Service.
  • Limited customer service options. Customer support isn't available on Sundays and there's no live chat feature on its website.
Interest compounding Daily
Minimum to earn interest $0
Monthly transaction limit 6
Fee per transaction over limit

Pen Air Christmas Club account

Pen Air Christmas Club account logo
0.4%
APY
None
Fees
$25
Min. opening deposit
  • Automatic deposits. Set up recurring deposits or transfers and watch your holiday savings stack up.
  • Immediate access on November 1. Pen Air transfers your Christmas Club account balance to your savings account on November 1 so you can start using your money immediately.
  • Flexible renewals. Make a deposit into your Christmas Club account by March 31 to start saving for the holidays again.
  • Can't open online. You may need to stop by a Pen Air branch or call 850-505-3200 to open this account.
  • Membership requirements. Pen Air primarily serves active duty, civil service employees and retired military and their families. But anyone can join when they become a member of the Friends of the Navy-Marine Corps Relief Society. The society fee is a one-time donation covered by the credit union.
  • Early withdrawal fee. You'll pay $10 if you need to access your money before they're distributed in November.
Interest compounding Monthly
Minimum to earn interest $0
Monthly transaction limit 6
Fee per transaction over limit $25

American Bank & Trust Christmas Club account

American Bank & Trust Christmas Club account logo
0.3%
APY
None
Fees
$10
Min. opening deposit
  • Bank My Change feature. If you have this feature turned on, American Bank & Trust will automatically round up your debit card purchases and deposit them into your Christmas Club account.
  • No deadline to open. If you open this account in September or October, your funds will be released in November of the following year.
  • Penalty fee for early withdrawals. You'll pay a $20 fee and lose all accrued interest if you close your account before maturity.
  • Interest earned annually. Most savings accounts accrue interest daily or monthly, but your money grows at a slower rate with this one because it accrues interest annually.
  • Account rates not listed online. You have to call a customer service representative to find out the current APY for this account.
Interest compounding Annually
Minimum to earn interest $0
Monthly transaction limit
Fee per transaction over limit

Consumers Credit Union Holiday Club Savings account

Consumers Credit Union Holiday Club Savings account logo
0.25%
APY
None
Fees
$5
Min. opening deposit
  • Funds transfer on November 1. Your funds automatically transfer to your Membership Share Savings account on November 1 each year so you can start shopping for the holidays.
  • Automatic renewals. This account automatically renews each year so you can keep saving for the holidays.
  • Multiple ways to open. There are three ways to open this account: online, in person or by phone.
  • Penalty for early withdrawals. If you access your money before November 1, CCU will close your account.
  • Members only. If you fall outside its normal field of membership, you can join if you pay a one-time, non-refundable fee to Consumers Cooperative Association.
  • Limited customer service hours. CCU customer service is only available weekdays during normal business hours and for a few hours on Saturday.
Interest compounding Monthly
Minimum to earn interest $0
Monthly transaction limit
Fee per transaction over limit

How to choose the best Christmas club or savings account

While the basic structure of a Christmas club account or savings account is consistent among the financial institutions that offer them, details in the features make each one unique. Here are a few key features to look for when finding the best account for you:
  • High interest rate. Even a small difference in interest rate can start to add up over the year.
  • Pays out interest frequently. The more frequently interest is compounded, the more you’ll earn.
  • Easy to deposit funds. These can include cash deposits, online transfers and automatic withdrawals from your checking account.
  • Low fees. Look for accounts that do not charge any monthly or transaction fees.
  • Easily accessible. If you don’t plan to use cash for your Christmas shopping, an account linked to your checking account will let you use your savings with your debit card.
  • Minimal penalties. Many Christmas club accounts will charge a penalty if you withdraw your money before November, while traditional savings accounts let you withdraw at any time. Decide if the motivation of a penalty is worth the fees you’ll face if you don’t stick to your savings plan.

Is a Christmas Club account a good idea?

Christmas club accounts are notorious for having low APYs and strict penalties if you dip into funds before November. Because of this, opening a regular savings account just for Christmas may be a better idea. You’ll most likely earn a higher rate — and you won’t pay a penalty if you need to withdraw cash before the holidays.

Here are a few alternatives to consider if you’re not set on a Christmas savings account:

  • High yield savings account. If you don’t need a penalty to motivate you to keep your hands off your savings, open a high-interest savings account just for your Christmas money. You’ll earn a higher APY, plus you’ll be able to withdraw funds at any time throughout the year.
  • Savings account with sub-accounts. If you don’t like the idea of having to manage multiple savings accounts, look for one that offers sub-accounts. For example, Ally Savings lets you split your money into different Savings Buckets, so you can track and manage multiple savings goals all in one place.
  • Christmas budget. Decide how much you want to set aside each month and write it into your budget — or have it transferred directly to your savings account as soon as your paycheck is deposited. If budgeting isn’t your strong suit, tools like Cleo or sub accounts can help.
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    Pros and cons of a Christmas club account

    Opening a Christmas club account instead of using a traditional savings account can help some people save for the holidays, but it isn’t for everyone.

    Pros

    • Can compel you to save. If you find it difficult to leave your money be, you’ll like that access isn’t easy before the term is up.
    • Can help you avoid credit. Planning your holiday spending in advance means you won’t have to rely on interest-accruing credit cards to buy presents.
    • Motivation. Penalty fees for withdrawing early can keep you motivated to stay away from your savings before Christmas.

    Cons

    • Penalties for early access. You’ll pay a penalty of up to about $20 or experience an account closure for accessing your money too early, even if for an emergency.
    • May not be necessary. Your average $0-fee savings account provides many of the same benefits — interest and monthly automatic transfers — without the limitations.
    • Interest rates. Christmas club accounts usually offer lower interest rates than online savings accounts or CDs.
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    Are there any risks I should be aware of?

    Although any deposit up to $250,000 is backed by the US government if you use an FDIC-insured bank or credit union, there are risks to be aware of if you use a Christmas club or savings account.

    • Withdrawal fees. Christmas club accounts may charge fees for withdrawing early, and traditional savings accounts often charge fees for making more than a certain number of withdrawals per month.
    • Low rate of return. Low-risk means low-reward, and savings accounts and Christmas Club accounts will provide a lower rate of return than riskier investments like stocks.

    How does a Christmas club account work?

    Christmas club accounts are short-term savings accounts offered by many credit unions and smaller banks. You deposit money into the account each month, then the bank “releases” the funds to you in November just in time for the holidays. You’ll typically pay a penalty if you need to make a withdrawal before November.

    Bottom line

    Setting aside money throughout the year can help take the stress out of the holidays — and prevent you from racking up credit card debt. But they usually have lower interest rates than $0-fee savings accounts and you can’t access your money until a certain time. If you won’t be tempted to spend your money on other things, you’ll want to compare more options and go with a $0-fee savings account instead.

    Compare even more Christmas savings accounts

    Name Product Annual percentage yield (APY) Fee Minimum deposit to open
    Aspiration Spend & Save Account
    Finder Rating: 3.8 / 5: ★★★★★
    Aspiration Spend & Save Account

    1.00% on $0 to $10,000 but you’ll need to be enrolled in Aspiration Plus and make at least $1,000 in debit card purchases a month
    $0 per month or $15 per month for Aspiration Plus ($12.50 per month if you pay annually)
    $10
    Deposits are fossil fuel-free and insured by the FDIC. Enjoy a spend and save combo account with unlimited cash back rewards and a $100 bonus when you spend $1,000 in your first 60 days.
    Go to site
    View details
    Axos Bank High Yield Savings
    Finder Rating: 4 / 5: ★★★★★
    Axos Bank High Yield Savings

    0.61% on $0 to $24,999
    0.25% on $25,000 to $99,999
    0.15% on $100,000+
    $0
    $250
    No monthly maintenance fees. No minimum balance requirements. Interest compounded daily.
    Go to site
    View details
    Chime Savings
    Finder Rating: 4.6 / 5: ★★★★★
    Chime Savings
    0.50%
    $0
    $0
    Grow your savings automatically with recurring transfers, round-ups on debit card purchases and 0.5% APY.
    Go to site
    View details
    Discover Online Savings Account
    Finder Rating: 4.6 / 5: ★★★★★
    Discover Online Savings Account
    0.40%
    $0
    $0
    Take advantage of a high-interest online savings account with no fees, no minimums and more.
    Go to site
    View details
    UFB Direct High Yield Savings
    Finder Rating: 3.6 / 5: ★★★★★
    UFB Direct High Yield Savings
    0.20%
    $0
    $100
    Earn an APY when your balance is higher than $10,000 with this no-monthly-fee savings account.
    Go to site
    View details
    SoFi Money
    Finder Rating: 4.3 / 5: ★★★★★
    SoFi Money
    0.25%
    $0
    $0
    SoFi Money® is a cash management account that charges no account fees to save, spend, and earn cash back rewards when you spend on brands you love.
    Go to site
    View details
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