Abound Credit Union Ups 24-Month And 36-Month CD Rates

Kentucky-based Abound Credit Union (Abound CU) ended the week by raising the rates on its 6-month CD (0.50% APY), 24-month CD (0.85% APY), and 36-month CD (0.95% APY). While the 6-month CD experienced the largest rate increase (15 bps), the 24- and 36-month CDs offer the more competitive rates. The minimum opening deposit is $500, with no stated balance cap.

Last month, I wrote about the competitive long-term CD and CD Specials currently offered by Abound CU. All three are still available and continue to offer very good rates.

Did You Know …

Abound CU is the former Fort Knox Federal Credit Union, an institution considered infamous by many DA readers since 2011. Simply put, 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 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.

More details, including the NCUA’s response to complaints about Fort Knox FCU, can be found in my September 2011 blog post.

To quote my most recent Fort Knox FCU blog post (September 2014),

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.

Now that I've discussed Fort Knox FCU's history, let’s talk about Abound CU's Early Withdrawal Penalties. As stated in the fine print at the bottom of the Savings Rates page, the Early Withdrawal Penalty reads as follows,

If all or part of the principal is withdrawn before the maturity date, the Credit Union may charge a penalty.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 between 3 months and 26 months; 180 days dividends, whether earned or not, on certificates with maturities between 30 and 48 months; 365 days dividends, whether earned or not, on 59 months certificates.

I find the the "may be made only with the consent of the Credit Union" phrase worrisome, as it can effectively negate the ability to make any early withdrawal.

Funding and Maturing Funds

Funds for opening a CD must be on deposit at Abound CU when the CD is opened. Funding a CD or CD Special can be done by wire transfer ($3 fee for incoming wires), by check, or through an internal transfer of funds, which according to CSR, is the easiest and best way to fund CD. Abound CU participates in the CO-OP Shared Branch network, so transferring outside funds into an Abound CU savings account should be relatively easy.

Dividends typically compound and paid out quarterly. CSR stated that if a CD is opened online with a deposit of $10k or more, monthly compounding and dividend payout is an option. If the CD is opened over the phone, the deposit amount doesn’t affect the availability to request monthly compounding and payout.

Maturing funds can be distributed by wire ($25 fee for outgoing), by check to the address on file, or by internal transfer to an Abound CU savings account. The grace period is 10 calendar days before a CD automatically renews.

Beneficiaries can be added after a CD is opened, with name, DOB, and Social Security number required for each beneficiary. CSR said a SS number is required “to determine if a person is eligible to be a beneficiary.” I asked what would make someone ineligible to be a beneficiary. CSR stated that Abound CU runs a background check on any potential beneficiary to make sure there is no fraud involved and the individual isn’t named “on something like a terrorist list.”

Availability

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. Abound CU is one of the easiest of “easy membership requirement” credit union because the only requirement is an initial $15 deposit. There's no need to join a charitable organization or credit union associated foundation.

Although the FOM change took effect about 17 months ago, Abound CU’s Membership page still lists the following ways to qualify for membership. CSR repeatedly assured me that none of these five requirements apply anymore.

• An employee of a Select Employer Group
• Individuals who live, work, worship, attend school, or regularly conduct business in portions of Kentucky
• Active duty military, Reserve, National Guard, or Civil Service employee
• Retired Military or Civil Service
• Contractors attached to Fort Knox Army base

Instead, the only requirement to join Abound CD is,

depositing $15 of which $5 represents one share in the Credit Union and the remaining $10 covers your one-time-only membership fee.

Joining Abound CU can be done online. CSR stated that the online membership application hasn’t been completely updated yet, so it’s not completely surprising to see five (now defunct) qualifying requirements (mostly military relationship requirements). CSR directed my attention to the following announcement on the online application,

If you can't find an eligibility requirement to match your situation, you can still join the credit union. Just select the "I'm eligible for membership through" drop down to the left and choose the "other" option.

Joining Abound CU can also be done at any of 16 full-service Kentucky branches located in Bardstown, Bowling Green, Brandenburg, Campbellsville, Danville, Elizabethtown (2), Fort Knox (2), Glasgow, Hodgenville, Leitchfield, Louisville (2), and Radcliff (2). According to Abound CU’s Locations page,

All lobbies are open. Check your branch location for updated hours.

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.

Abound CU participates in both the CO-OP Shared Branch network and the ATM network.

Credit Union Overview

Abound Credit Union has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 1.05% (excellent) based on March 31, 2021 data. In the past year, Abound CU has increased its total non-brokered deposits by $185.1 million, an excellent annual growth rate of 12.91%. Please refer to our financial overview of Abound Credit Union (NCUA Charter # 700) 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 has more than 100,000 acres that stretch across three Kentucky counties and is the sixth largest community in Kentucky.) 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 Kentucky’s largest credit union, with nearly 114,000 members and assets in excess of $1.9 billion.

How the CDs Compare

When compared to the similar length-of-term CDs tracked by DepositAccounts.com that are available nationwide and require a similar minimum opening deposit, Abound Credit Union's 24-month CD APY ranks second.

When compared to the similar length-of-term CDs tracked by DepositAccounts.com that are available nationwide and require a similar minimum opening deposit, Abound Credit Union's 36-month CD APY ranks third.

The above information and rates are accurate as of 7/17/2021.

To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.