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When you have cash available, your operating loan is paid first and all excess funds are then invested in an account comprised of AgriBank Investment Bonds. These bonds pay interest at rates that normally are significantly higher than what can be earned on typical commercial bank accounts – like checking, savings, money markets and even certificates of deposit (CDs). When you need cash for operating expenses, the investment account funds are used first, before advancing funds on your operating loan, helping to minimize your operating loan interest cost.
DISCLOSURE STATEMENT: This is not an offer for the sale of Farm Cash Management (FCM)®investment accounts or AgriBank Money Market Investments. Such investments are not insured by or a different obligation of the United States government. FCM investments can only be purchased directly from AgriBank, FCB. Carefully review the disclosure informtion provided to all prospective purchasers prior to purchasing. Farm Credit associations are not authorized to represent AgriBank regarding such investment accounts. You should not rely on any statement or opinion of our associations or personnel in deciding upon the safety and soundness of FCM accounts or their suitability for your particular situation. Certain terms and conditions apply to FCM accounts.
Funds are immediately available by writing a draft on your revolving line of credit, unlike having to transfer your funds from a savings or investment account to a checking account to be disbursed. Funds also can be transferred via the Internet and phone. And unlike some investments that require funds be locked in for a certain period and assess a penalty for early withdrawal, Farm Cash Management investment funds are liquid and available at any time.
Unlike most NOW accounts or money market accounts, Farm Cash Management has no limits on the number of drafts that can be written or the number of electronic funds transfers that can be made. And there are no monthly or per check fees like you will find with most of these other accounts.
Interest earned on AgriBank Investment Bonds is exempt from state and local income tax, so the tax-adjusted annual yield is even higher.
Using Farm Cash Management is as simple as making a loan payment or writing a draft on your operating loan. Enrollment is easy, too. Contact your local Farm Credit Illinois office to obtain the forms.
The Farm Cash Management program combines the ready availability of a revolving line of credit with the high return of a short-term investment account. The program saves you money by putting your funds to work where they generate the best return. Returns are far superior to the investment option of a low interest savings account.
Use Farm Credit's FC Connect - Online Banking as one of the ways to access your funds, make payments or check balances. The first step to enjoying this convenience is to "enroll."
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