As DA reader, me1004, noted in a Forum post last week, Kentucky-based Abound Credit Union (Abound CU) has added a very competitive 10-month CD Special earning 5.75% APY. This limited-time CD Special can be opened with a $500 minimum deposit, with no stated balance cap.
A Little History
Abound CU is the former Fort Knox Federal Credit Union, an institution considered to be infamous by DA’s readership since 2011. In a nutshell, Fort Knox FCU changed the rules in the middle of the game to the detriment of existing CD account holders. Fort Knox FCU doubled the early withdrawal penalty (EWP) on its long-term CDs (from 90 to 180 days interest), which is certainly their right to do, but applied the new EWP retroactively to existing CDs.
Citing a generic clause buried in the Membership Agreement as justification, Fort Knox FCU essentially voided the contract with its CD-holding members, rescinding a mutually agreed upon specific (and very important) feature.
The terms and conditions of any account, including the method of determining dividends, may be changed by the Credit Union upon written notice, or as required by applicable law.
For more details, including the NCUA’s response to complaints about Fort Knox FCU, can be found in my September 2011 blog post.
Since mid-2021, I’ve written about Abound CU on seven occasions; previous to the June 2021 blog post, the last Abound CD blog post was published seven years previously. To quote myself from the September 2014 Fort Knox FCU blog post,
I know some readers might prefer that I not give Fort Knox FCU any publicity. I think it’s better to give all the facts, including its history. If I don’t report on these CDs, people will get information about these CDs from other websites which won’t provide any of the credit union’s history.
Early Withdrawal Penalty
As stated in the fine print at the bottom of the CD Specials landing page, the Early Withdrawal Penalty reads as follows (emphasis is mine),
If all or part of the principal is withdrawn before the maturity date, the Credit Union may charge a penalty.
Withdrawal of the principal amount of the certificate may be made only with the consent of the Credit Union.
Unless stated otherwise, the owner shall forfeit an amount equal to 90 days dividends, whether earned or not, on certificates with maturities of 24 months or less; […]
The penalty will, if necessary, be taken from the principal amount of the deposit.
The "may be made only with the consent of the Credit Union" phrase is definitely not good news. While the use of “may” indicates there is a possibility that an early withdrawal might be denied, it can also effectively nullify the ability to make any early withdrawal.
Headquartered in Radcliff, Kentucky, the former Fort Knox Federal Credit Union’s field of membership (FOM) changed in 2020 when the Abound Credit Union rebrand occurred. At that time, Abound CU became a very “easy membership requirement” (EMR) credit union, as the only requirement to join was an initial $15 deposit.
The EMR requirement changed again about a year ago, with the online membership application listing three ways to qualify for membership:
I am eligible to join the Credit Union through one of the following ways:
- I want to support one of the following military and veteran support groups with a $10 membership fee:
- USA Cares Association
- ETCT Military Education Assocation
- I live, work, or worship in one of these Kentucky counties:
- Boyle, Breckenridge, Grayson, Hart, Larue, Meade, Nelson, Taylor
- I have family that banks or works here:
- Child, Parent, Sibling, Spouse, Grandparent, Grandchild
Joining Abound CU can be done online or at any of 15 full-service Kentucky branches located in Bardstown (2), Bowling Green (2), Brandenburg, Campbellsville, Danville, Elizabethtown (2), Fort Knox (2), Glasgow, Hodgenville, Leitchfield, Louisville, Radcliff (2), and Shepherdsville.
Existing members can open a CD in any of the above-mentioned branch locations, by phone (800.285.5669), or by using Abound CU’s Online Banking platform (detailed listed at the bottom of the Certificate Specials page).
For those joining Abound CU, opening a CD can only be done after a membership application is submitted and approved, and can be done online, by phone (800.285.5669), or at any of the above-mentioned branch locations.
The initial requirement for membership is only $15, of which $5 represents one share in the Credit Union and the remaining $10 covers your one-time-only membership fee.
Abound CU participates in both the CO-OP Shared Branch network and ATM network.
Funding and Other Details
The following information was obtained from the CD Specials landing page and a conversation with CSR.
- Funding – Wire ($3 fee), check, or internal transfer. Funds must be on deposit before opening a CD Special.
- Ownership – Individual, joint, or trust.
- CO-OP Shared Branch Participant – Yes.
- Interest – Compounded/credited quarterly, but dividends may be paid monthly for account balances of $10k+. Can be distributed by check or transferred to an Abound savings account.
- Maturing Funds – Wire ($25 fee), cashier’s check to address on file, or internal transfer to Abound CU savings account.
- Beneficiaries – Unlimited, with equal shares, Social Security numbers are required for beneficiaries.
- Grace Period – 10 calendar days before automatic renewal at a comparable term.
- Credit Check – Soft pull.
Credit Union Overview
Abound Credit Union has an overall health grade of "A" at DepositAccounts.com, with a Texas Ratio of 1.85% (excellent) based on March 31, 2023 data. In the past year, Abound CU has increased its total non-brokered deposits by $34.94 million, an above average annual growth rate of 1.99%. Please refer to our financial overview of Abound Credit Union (NCUA Charter # 7000) for more details.
Established in 1950, the original Fort Knox Civilian Employees Federal Credit Union served the civilian employees of the Fort Knox army base. (Fort Knox is the sixth largest community in Kentucky, comprised of more than 100,000 acres stretching across three Kentucky counties.) The original FOM was expanded in 1960 to include members of the military. In January 2020, Fort Knox FCU announced the Abound rebrand. According to a Nelson County Gazette article,
The name change is an effort to expand the credit union’s customer base by rebranding it with a new logo and name that excludes “federal” from the name.
According to the credit union’s study, the reason more local families don’t join Fort Knox Federal Credit Union is due to a lack of understanding due to the name. The goal is to clarify that the credit union and its membership is open to the members of the community.
The credit union will continue its commitment to the Fort Knox military post.
Abound Credit Union is currently the largest credit union headquartered in Kentucky, with more than 130,000 members and assets in excess of $2.1 billion.
How the 10-Month CD Special Compares
When compared to similar length-of-term CDs tracked by DepositAccounts.com which are available nationally and have minimum deposit requirements of $10k or less, no banks or credit unions have higher rates than currently offered on the Abound Credit Union 10-month CD Special. The following table compares the 10-month CD Special to the two highest-rate CDs from other credit unions and the two highest-rate CDs from banks.
|APY||CD Term (Early Withdrawal Penalty)||Credit Union/Bank|
|5.75%||10-Month CD Special (EWP=90 days)||Abound Credit Union|
|5.70%||14-Month CD Special (EWP=180 days)||Langley Federal Credit Union|
|5.61%||12-Month Certificate (EWP=90 days)||Connexus Credit Union|
|5.60%||12-Month CD (EWP=90 days)||Limelight Bank|
|5.55%||12-Month CD (EWP=90 days)||CFSB|
The above information and rates are accurate as of 8/28/2023.
To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.