In the past, I’ve written a couple “good news Monday” blog posts about Navy Federal Credit Union (Navy Fed). The latest good news Monday offering is a 37-month IRA/ESA Certificate Special, earning 3.00% APY. This limited-time Special can be opened with as little at $50 and is capped at $150k. Additional deposits are allowed throughout the term, subject to the $150k balance cap.
|3.00%||$50||$150k||Navy Federal Credit Union||37 Month IRA Special (Traditional, Roth, SEP)|
|3.00%||$50||$150k||Navy Federal Credit Union||37 Month ESA Special|
DA readers who follow Navy Fed may recall the 40-month IRA/ESA Certificate Special (3.75% APY) that was unveiled in December 2018. That Special lasted through the end of April 2019.
As stated in Navy Fed’s Certificates brochure, the Early Withdrawal Penalty reads as follows:
Certificates with a term greater than one year: Forfeiture of all dividends on the amount withdrawn for 180 days or since the date of purchase or renewal (whichever is less).
Accrued interest can always be withdrawn without any penalty. According to Navy Fed’s Certificate Brochure,
Dividends on Navy Federal certificates are compounded daily and credited monthly. They’re posted to the account on both the last business day in the period in which they are earned and at maturity. Dividends that have been credited are available for withdrawal anytime without penalty.
Many thanks to DA reader, CapitalClimate, for the “good news Monday” Forum post.
$50 IRA Bonus
Members who open their first IRA and deposit at least $50 in the new IRA no later than 45 days after account opening will earn a $50 bonus. The bonus will be credited into the IRA account within 30 days of funding. The $50 bonus will be classified as a dividend and “will not be reportable as a contribution."
Funding and Accessing Maturing Funds
The easiest way to fund a Certificate online is probably through a transfer from an existing Navy Fed checking, savings, or Money Market Savings account. An ACH transfer initiated by another institution may be the quickest way to get the funds into your Navy Fed liquid account. Once the funds are received, a Certificate can be opened using the online application, which allows you to specify that funds be pulled from that Navy Fed account.
A straightforward way to access maturing funds is to transfer the funds into any existing Navy Fed checking, savings or Money Market Savings account. There is a 21-day grace period following maturity before the IRA Certificate automatically renews.
Note – Navy Fed has restrictions on ACH debits from its savings account. Navy Fed’s Electronic Funds Transfer Agreement and Disclosure reads in part,
When you originate an ACH transfer at another financial institution, please note that your Navy Federal savings account may only receive ACH credits. Checking accounts may receive ACH credits and debits. MMSAs may receive ACH credits and debits in accordance with the limitations set forth in the MMSA agreement.
If you plan to pull funds from Navy Fed using the ACH service of another institution, you should consider opening either the Money Market Savings account or one of Navy Fed’s checking accounts.
Beneficiaries and Trust Accounts
Unlimited beneficiaries (with assigned percentages) can be named, with name, address, DOB, and Social Security numbers required for each beneficiary. To designate beneficiaries, refer to Navy Fed’s Payable on Death (POD) and Deposit Trust Accounts Form. This form can also be used to open accounts under a legal trust; Navy Fed calls that type of account a “Deposit Trust Account.”
Unlike PenFed's nearly universal membership eligibility, Navy Fed’s field of membership (FOM) is restricted to individuals who have a military connection, regardless of residency status.
As I discussed in a 2017 blog post, Navy Fed’s FOM has expanded and, while a military connection is still required, many more people are now eligible to join. The most recent group added are individuals with family members who were affiliated with the military at any time.
Navy Fed’s "Member Eligibility" page lists the various ways to qualify for membership.
Active Duty, Retired and Veterans – Service members in all branches of the armed forces are membership-eligible, including:
- Active Duty members of the Army, Marine Corps, Navy, Air Force, Coast Guard, and Ait National Guard.
- Delayed Entry Program (DEP)
- DoD Officer Candidate/ROTC
- DoD Reservists
- Veterans, retirees, and annuitants
Family Members – Individuals with parents, grandparents, spouses, siblings, children (adopted and step), grandchildren, or household members who at any time were affiliated with the military or are already Navy Fed members are also eligible to join.
Department of Defense (DoD) Civilians – Any DoD civilian employee, U.S. government employees/contractors assigned to DoD installations, and DoD retiree/annuitants are welcome to apply.
A Basic Savings account (minimum $5 deposit) comes with your Navy
Federal membership and opens the door to our suite of saving products.
Credit Union Overview
Navy Federal Credit Union has an overall health grade of "A" at DepositAccounts.com, with a Texas Ratio of 5.65% (excellent) based on June 30, 2019 data. In the past year, Navy Fed has increased its total non-brokered deposits by $11.63 billion, an excellent annual growth rate of 17.06%. Please refer to our financial overview of Navy Federal Credit Union (NCUA Charter # 5536) for more details.
Headquartered in Vienna, Virginia, Navy Federal Credit Union is considered the largest credit union in the world. Founded in 1933 as the Navy Department Employees’ Credit Union of the District of Columbia, Navy Federal has grown from its initial seven members to more than 8,850,000 members and assets in excess of $110 billion.
How the IRA Certificate Compares
When compared to 158 similar length-of-term IRA Certificates tracked by DepositAccounts.com that are available nationwide, Navy Federal Credit Union’s 37-month IRA Certificate Special APY currently ranks first, regardless of deposit limitations.
The above rates are accurate as of 12/11/2019.
To search for the best IRA Certificate rates, both nationwide and in state specific, please refer to our IRA Certificate Rates Table page.