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Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Survey of the Best CD Rates for February 22, 2013

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Survey of the Best CD Rates for February 22, 2013

This was another quiet week for rate changes. That may change next Friday when March begins. Credit unions like PenFed often make CD rate changes at the start of each month. I will be surprised if PenFed continues its 1-, 2- and 3-year CD rates into March. For those who don't want to lock into long-term CDs, it's hard to beat these. PenFed's 1.25% 1-year CD has a higher rate than most 2-year CDs from internet banks. Its 2-year CD rate (1.60% APY) is higher than Ally Bank's 5-year CD rate, and PenFed's 1.85% 3-year CD equals the rate of best 5-year CD from internet banks.

There was some CD news this week that didn't involve rates. Thanks to DA member primary, we learned of CD early withdrawal penalty increases that will take effect next month at Discover Bank. The 4- and 5-year CD EWP will increase from 6 to 9 months of interest, and the 7- and 10-year CD EWP will increase from 9 to 15 months of interest. These changes will only affect new CDs or CDs renewed on or after 3/15/2013.

I added one credit union to the nationwide list this week. It's a special 11-month CD with a 3.00% APY from Chartway Federal Credit Union. As you might have guessed, there's a catch. There are actually two. First, there's a $20K maximum deposit, and second, it requires direct deposit for the duration of the CD. Nevertheless, it's nice to see new CD specials with rates reminiscent of the good old days.

Local CD Deals

There were a handful of CD rate cuts this week for the CDs that aren't nationally available. These include cuts from two Texas credit unions. Texell Credit Union in Central Texas slashed its 5-year CD yield from 2.05% to 1.50%. Due to this big cut, I removed Texell from my list. The other one was TEXAR Federal Credit Union in Northeast Texas. Its 2-year online CD yield fell from 2.12% to 1.50%. On the plus side, its 1-year online CD yield increased from 0.80% to 1.50%.

The only addition this week was Actors Federal Credit Union which has branches in Los Angeles, Chicago and New York City. It's offering a 2.15% APY 5-year IRA CD and a 2.00% APY 5-year CD. To qualify for membership you have to be a member or employee at one of several acting-related organizations.

Long-Term CD Break Strategy

For the short-term CDs in my lists, you might notice CDs with the note "5-year CD closed after X years". These take into account the yield after the early withdrawal penalty is applied. Since Ally Bank's 5-year CD only has a 60-day interest penalty, it's still a good deal when closed early even with the recent rate cuts.

The risks of planning for early withdrawals of long-term CDs were recently highlighted by the deposit agreement change at Ally. The risks have also been seen at credit unions which have raised the early withdrawal penalties on existing CDs. I have more details in this blog post.

Note About the CD Survey

As I described in my rate table overview, you can use our CD rate tables to find the best rates for both nationally available CDs and local CDs. This CD survey blog posts are intended to highlight nationwide CD deals that may not be apparent in the tables. For example, I'll include the post-penalty yields of a few long-term CDs.

The CD survey blog posts are also intended to highlight the local CD deals that are available in large metro areas. There are many high CD rates, but most of these are at small banks in rural areas or at small credit unions with very narrow fields of membership. In these local CD surveys, my focus is on local CD deals that are in big cities or that are available in large areas of a state.

Yields Accurate as of February 22, 2013

Under 1-Year CD Rates

  • Noteworthy Local Deals

1-Year CD Rates

  • Noteworthy Local Deals

18-month CD Rates

  • Noteworthy Local Deals

2-Year CD Rates

  • Noteworthy Local Deals

3-Year CD Rates

  • Noteworthy Local Deals

4-Year CD Rates

  • Noteworthy Local Deals

5-Year CD Rates

  • Noteworthy Local Deals

Over 5-Year CD Rates

  • Noteworthy Local Deals

Note: All rates listed above are Annual Percentage Yields (APY) which factor in compounding.


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Comments
2 Comments.
Comment #1 by lof posted on
lof
opened the pentagon 2yr 1.60%, took only 5 minutes on the phone and it was done.  Reason for going with a existing CU or Bank, for these rates shouldn't have to jumb thru any hoops.

1
Comment #2 by kiwi posted on
kiwi
Not accounting for the interest rate. Is it generally better to open a 6, 9, 12, 18 or 24 month IRA CD?

1