Self-Help Credit Union CD Update
Jul 4, 2006 - 1:32 PM by Ken Tumin
Self-Help Credit Union (SHCU) has some decent rates on mid and long term CDs. The big advantage with these CDs is that you can make additional deposits at any time during the CD term with no add-on limitations. The original term and interest rate of the CD remain the same. With only a $500 minimum deposit requirement, this can make for a very nice feature when there's doubt about how long interest rates will continue to rise. Refer to my post on building a CD ladder at SHCU.
The one bad feature of SHCU's CDs had been their early withdrawal policy. No early withdrawals were allowed, not even with a penalty. However, this has changed. SHCU now allows early withdrawals. The penalty is half of the interest you would earn over the term of the certificate. So for a 24-month CD, the penalty would be 12 months of interest. This is higher than the typical 6-month penalty, but it's better than not allowing any withdrawal.
Below are the CD rates as of July 4, 2006:
One thing to note regarding these rates is that they change daily. Usually, by only a few hundredths of a percent. But there have been a few times in which they've dropped by a few tenths of a percent. This could be worrisome if you mail a check since you get the rate of the CD on the day that the check and application arrive at SHCU. It has been reported that SHCU will allow you to include a note with the application stating the lowest rate you will accept on your CD.
For those not aware of SHCU, it's one of the few credit unions in which anyone from any state can join by just paying a one-time $25 fee for membership into a non-profit organization (FOM).
The one bad feature of SHCU's CDs had been their early withdrawal policy. No early withdrawals were allowed, not even with a penalty. However, this has changed. SHCU now allows early withdrawals. The penalty is half of the interest you would earn over the term of the certificate. So for a 24-month CD, the penalty would be 12 months of interest. This is higher than the typical 6-month penalty, but it's better than not allowing any withdrawal.
Below are the CD rates as of July 4, 2006:
Term APR APY
3-month term 4.76 4.87
6-month term 4.89 5.01
12-month term 5.27 5.41
24-month term 5.48 5.63
36-month term 5.47 5.62
48-month term 5.49 5.64
60-month term 5.50 5.65
One thing to note regarding these rates is that they change daily. Usually, by only a few hundredths of a percent. But there have been a few times in which they've dropped by a few tenths of a percent. This could be worrisome if you mail a check since you get the rate of the CD on the day that the check and application arrive at SHCU. It has been reported that SHCU will allow you to include a note with the application stating the lowest rate you will accept on your CD.
For those not aware of SHCU, it's one of the few credit unions in which anyone from any state can join by just paying a one-time $25 fee for membership into a non-profit organization (FOM).
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Mark Stone (anonymous) - #1, Tuesday, July 4, 2006 - 2:37 PM
I'll second your caution about SHCUs changing rates. You are correct about including a note explaining the lowest APY you will accept for your specific term. I have done that several times and Tara (the woman who sets up the CDs) has always done what was asked (ie call me if rate wasn't high enough, deposit check into a current CD or return the check).
Banking Guy (anonymous) - #2, Tuesday, July 4, 2006 - 4:13 PM
Thanks for your inputs Mark.
I just noticed that the SHCU's money market account rate went up to 4.68% APY from 4.48%. It's not a great rate, but it's respectable considering it only has a $500 minimum and has check writing.
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