Dedicated to Deposits: Deals, Data, and Discussion
DETAILSINSTITUTIONAPYMINMAXPRODUCT
Pentagon Federal Credit Union1.51%$1k-5 Year Money Market Cerificate
Pentagon Federal Credit Union1.51%$1k-7 Year Money Market Cerificate
Pentagon Federal Credit Union1.26%$1k-4 Year Money Market Cerificate
Pentagon Federal Credit Union1.00%$1k-3 Year Money Market Cerificate
Pentagon Federal Credit Union0.90%$1k-2 Year Money Market Cerificate
Pentagon Federal Credit Union0.80%$1k-1 Year Money Market Cerificate
Accounts mentioned in this post. Rates as of April 20, 2014

PenFed Announces a Large CD Rate Increase for October

POSTED ON BY

Pentagon Federal Credit Union

After several months of subpar CD rates, Pentagon Federal Credit Union (PenFed) will be making a pleasant change in October. On Sunday, PenFed advertised in the LA Times about its October CD rates. Thanks to DA member saverguy99 who posted on this news in the forum. Below is a list of these new CD and IRA CD rates that should be official by October 1st:

  • 2.02% APY 7-year CD (was 1.76%)
  • 2.02% APY 5-year CD (was 1.56%)
  • 1.76% APY 4-year CD (was 1.41%)
  • 1.51% APY 3-year CD (was 1.26%)
  • 1.26% APY 2-year CD (was 1.00%)
  • 0.75% APY 1-year CD (was 0.50%)

Update 10/1/13: The above CD rates are now listed on PenFed's website.

These CD rates are not yet posted at PenFed’s website. They will take effect on October 1st, 2013. I confirmed these rates with a PenFed CSR this morning.

These CD rates are not exceptional like some of the past PenFed CD deals, but they’re near the rate leaders for these terms. Hopefully, it’s a sign of things to come.

PenFed calls their CDs "Money Market Certificates", but they are essentially certificates of deposit (CD) with fixed rates for specific terms.

Minimum deposit is $1,000. The rates are also available in an IRA. The early withdrawal penalty is up to 180 days of interest for terms from 1 year to 4 years. The penalty is up to 365 days of interest for terms of 5 and 7 years. The penalty doesn’t eat into the principal. For example, if you withdraw principal before 1 year on a 5-year CD, you’ll lose all interest but none of the principal.

Even though PenFed typically maintains CD rates through the month, they no longer guarantee it. For more details about PenFed CDs, please refer to my PenFed CD review.

PenFed Membership

PenFed makes it easy for anyone to join and open accounts online. If you don't qualify based on military, employer or family, you can become eligible by joining the National Military Family Association (one-time $20 fee) or by joining the Voices for America's Troops (one-time $15 fee). Joining one of these organizations and joining PenFed can be done at the same time all online. Our PenFed overview section has more details on PenFed’s membership qualifications.

To join PenFed, click on the "Join PenFed" link at the top of any PenFed page. This will take you to the start of the online application. That first page asks about eligibility. If you don't qualify via any of the listed options, click "None of the above". A popup informs users that "We can establish your membership eligibility through either National Military Family Association or Voices for America's Troops." When you close the popup, you are then asked to select one of these two organizations.

Branch Locations

Accounts can be opened online, but for those who prefer opening accounts in an office, PenFed has branches in several parts of the country including Washington DC, Maryland, Virginia, New York, North Carolina, Hawaii, Puerto Rico and Texas.

Credit Union Overview

PenFed is the third largest credit union in the nation. It has $12.5 billion in deposits. PenFed has an overall health score at DepositAccounts.com of A+ with a Texas Ratio of 3.17% (excellent) based on June 2013 data. Please refer to our financial overview of PenFed for more details. It's federally insured by the NCUA (Charter # 227).

How These CD Rates Compare

Internet bank CDs and brokered CDs currently offer the best long-term CD rates. The best 5-year CD rate that you can get directly from a bank or credit union without a checking requirement is 2.05% APY at iGObanking.com as of 9/30/2013.

Searching for the Best CD Rates

To search for the best nationwide rates and the best rates in your state, please refer to the following tables at DepositAccounts.com:

  Tags: New York, North Carolina, Hawaii, Texas, Virginia, Pentagon Federal Credit Union, CD rates, Maryland, IRA rates

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Comments
19 comments.
Comment #1 by OAG posted on
OAG
Seems a little bit odd especially for PFCU that the 7 year CD rate is the same as the 5 year CD.

5
Comment #2 by Scottj (anonymous) posted on
Scottj
Decent bump but to me makes the Institution For Savings 30 month 2% CD look even better since I have a feeling will be awhile before PenFed bumps again. This has been a busy month for maturing CDs for me had another large one mature today, since I now don't have any more maturing till Jan 2014 was going to put into 1.17% MM to have something in case something pops up? but now wondering if there will be anything better than that 30 month 2%? Probably need to decide quick as that will probably end any day.

4
Comment #3 by Anonymous posted on
Anonymous
OAG, very common for them to have done it in the past.

1
Comment #4 by Anonymous posted on
Anonymous
Does anyone know the penfed. ewp on the five year cd?

1
Comment #6 by paoli2 posted on
paoli2
#4   It's not a dumb question since not everyone has the time to read every article.  I did read it and to save you a bit of reading, it is a one year EWP which I think is a bit high for 5 years. 

BTW, #5, it is an EWP not an EWD.  I would not call others dumb unless I made sure I was a lot smarter and at least spellchecked my posts. 

8
Comment #7 by Anonymous posted on
Anonymous
You go girl!

4
Comment #8 by OldGuy posted on
OldGuy
PenFed has also posted a 1.26% APY 2-year rate.

2
Comment #9 by Anonymous posted on
Anonymous
Nice increases, but still a joke.  I got 1.85% on their 3-year CDs just back in February.  Between then and a month ago 3-year fell below 1%.  They over did it with the rate cuts.  2% on a 5-year is still a rip off.  We should see mid 2s by 1st quarter next year.

2
Comment #10 by Anonymous posted on
Anonymous
"We should see mid 2s by 1st quarter next year."

Don't count on it.

4
Comment #11 by Anonymous posted on
Anonymous
This is comical as you only get 2%  for a 7 yr investment.  I think not!

1
Comment #12 by Anonymous posted on
Anonymous
Mid 2s by 1st quarter, wow that's something to look forward to.

2
Comment #13 by Scottj (anonymous) posted on
Scottj
So decided to open another 30 month 2% CD, figured I would regret it if I didn't. Probably best deals I would see over the next few months would be maybe a 36 month 2% or at the very best maybe another 24 month 2% like we had from USalliance. Oh well at least with the less I earn in interest means more subsidies money from Obamacare

2
Comment #14 by Anonymous posted on
Anonymous
Interest rates stay low savers suffer, interest rates go up U.S. goes bankrupt, pick your poison. Some experts say interest rates cannot go up by much or else the U.S. could become one big Detroit.

2
Comment #15 by Anonymous posted on
Anonymous
Spread the poison.  Raise the Interest Rates.  The U.S. is already broke!

7
Comment #16 by Anonymous posted on
Anonymous
Hi Scottj,

Please let me know where you are getting 1.17% in MM?

 

Thanks!

3
Comment #17 by Anonymous posted on
Anonymous
penFed has alot of cd's maturing in 2014 with rates of 4.75%.It kept getting lower each month. I don't know how customers will react to 2% vs. 4.75%

2
Comment #18 by paoli2 posted on
paoli2
#17  How can we react?  Do we have a say in the matter?  It's a "take what you can get" economy.  I would rather get 2% than 1% or less.  I just pull back on buying etc. to make up for the pitiful rates.  It's truly a "survival of the fitess" economy.  The worse thing we can do is to get desperate and try more risky investments.  We have to ride it out and it could be a very long ride!

3
Comment #19 by Anonymous posted on
Anonymous
Right on, paoli2, with your #18 comment! 

Never thought I would see the day when 2% looked good.  Not that it really is, but like you stated, it's better than 1% of less.  I, will be dropping from PenFed's 6.25% CDs to their then current rates in 2014.  Bummer, but I have to accept the realaity of the current situation.  I WILL NOT be foreced into riskier investestments at this time in my life!   

4
Comment #20 by AnonyMUST (anonymous) posted on
AnonyMUST
I too am dropping from 6.25% APY at PenFed. While I was outraged by the stunts that nearly killed the debt ceiling legislation, I wonder how much higher the interest rates would go if we DID drive off the cliff. I know the tradeoff would not be favorable since I have an equal amount invested at risk in some Mutual funds, not the least of which is FBIOX  whose YTD is over 56% (not a typo), so NO I would not like to trade the 2% rate for a 3% or even 5% rate and watch my 56% fall through a newly developed hole in the wall.

DO any of you remember the Carter rates? CD's with 14-15.5% return and safe!  Too bad we can not create that at least for pensioners on fixed incomes!

 

1
Comment #21 by Anonymous posted on
Anonymous
It's about time the low interest rates are starting to affect more of this group.  Maybe next time there's a petition about low interest rates there'll be more participation.

Welcome aboard!

4