Pen Air Fed Credit Union Has 15-Month Add-On CD, Unlimited Deposits
In addition to currently having the top-rated nationally available 18-month CD (1.55% APY), Pen Air Federal Credit Union (Pen Air) is also offering a 15-month Add-On CD, earning 1.50% APY. According to CSR, there are no limitations on the Add-On CD: unlimited additional deposits in any amount can be made at any time throughout the term. The minimum opening deposit is $500, with no stated balance cap.
| APY | MIN | MAX | INSTITUTION | PRODUCT | DETAILS |
|---|---|---|---|---|---|
| 0.80% | $500 | - | Pen Air Federal Credit Union | 15 Month Add-On CD | |
| 0.80% | $500 | - | Pen Air Federal Credit Union | 15 Month Add-On IRA (Traditional, Roth, CESA, SEP) |
The Add-On CD is also offered an as IRA (Traditional, Roth, SEP, CESA), earning the same APY with the same deposit requirements.
Nearly four years ago, DA reader and guest blogger, Charles Rechlin, wrote a very informative blog post, “Searching for the Elusive Add-On CD.” Charles stated that,
To my mind, an ideal add-on CD possesses the following features:
- a multi-year term (three or more years)
- a fixed or minimum rate that is reasonably competitive with rates offered on CDs of identical maturity that don’t carry add-on rights
- a low opening balance requirement
- an unlimited right to make additional deposits from time to time, with no maximum balance
It’s extremely difficult, if not impossible, to locate a CD combining all of these features. You’re fortunate if you can find one with a couple of them.
Pen Air’s 15-month Add-On CD definitely puts savers in the “fortunate” category, having three of the features mentioned above. If you have a CD that’s maturing in the next few months, opening an Add-On CD with a $500 deposit now can provide a safe haven for those maturing funds in the near future.
I would be remiss if I didn’t mention that there’s always a possibility that a credit union might change the add-on terms on existing CDs. DA readers may remember that in October 2019, GTE Financial made changes to the terms of existing promotional share certificates opened in 2018 and 2019. While GTE Financial quickly reversed its decision after a general outcry by its members, there’s no guarantee that another credit union won't be more intractable.
Long-Term CDs
Pen Air’s long-term CDs (3-, 4-, and 5-year) remain competitive, even after rate cuts in late May. All three of the long-term CDs rank in the top five of their respective categories in yesterday’s CD Rates Summary. Any Pen Air CD can be opened with a $500 minimum deposit and are also available as IRAs.
As stated in the Account Disclosures document, the Early Withdrawal Penalty reads as follows:
Terms of 12 months or longer – 180 days’ dividends.
According to Pen Air’s online application,
You can fund your account by transferring funds from any one of the following options:
An existing Pen Air FCU account
Direct Deposit (Account must be funded within 15 business days)
Check by Mail (Account must be funded within 15 business days)
Maturing funds will be sent by cashier’s check to the address on file, by wire ($25 fee), or transferred to another existing Pen Air account. The CD will automatically renew following the 7-day grace period.
Availability
Headquartered in Pensacola, Florida, Pen Air Federal Credit Union’s field of membership (FOM) provides a way to join for virtually any U.S. citizen or resident alien who has a valid Social Security number.
Easy Membership: Joining the Friends of the Navy-Marine Corps Relief Society, Inc., (a one-time $1 donation) qualifies for membership in Pen Air.
Established in 1904, the Navy-Marine Corps Relief Society is a 501(c)3 organization, which provides financial, education, and other needed assistance to active-duty and retired Sailors and Marines.
According to Pen Air’s online application,
I understand Pen Air will make a $1 donation to the Friends of the NMCRS on my behalf.
SEGs: Employees/members of more than 1,200 businesses, associations, churches, and local governments in northwest Florida and southeast Alabama are eligible to join.
Military Relationship: Active duty/retired members of the military (including the Coast Guard) and civil service employees qualify for membership.
Family Relationship: Immediate family members and household members of current Pen Air members are welcome to apply.
Joining Pen Air and/or opening an Add-On CD can be done online. Pen Air has begun the process of re-opening its branch lobbies, with regular hours at one Alabama (Robertsdale) and three Florida (Corry, Nine Mile, and Pace) locations. At this time, all other locations are by appointment only. “All drive-thru and Pen Air Live drive-thru locations continue to operate during their normal business hours.
A minimum opening deposit and maintained balance of $25 is required.
This is your share in Pen Air and remains in your savings account.
Just an FYI – Pen Air’s Fee Schedule lists a $15 monthly Inactive Account Fee, if there is “no monetary activity for 12 months on a share or share draft account."
Pen Air participates in the CO-OP Shared Branching, giving its members access to more than 5,000 shared branches and nearly 30,000 ATMs throughout the country.
This shared branching network allows credit unions to serve each other's members. As a Pen Air member you can go to another credit union who is a part of the shared branch network and do transactions on your Pen Air account.
Credit Union Overview
Pen Air Federal Credit Union has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 2.09% (excellent) based on December 31, 2019 data. In the past year, Pen Air has increased its total non-brokered deposits by $75.24 million, an excellent annual growth rate of 6.17%. Please refer to our financial overview of Pen Air Federal Credit Union (NCUA Charter # 1303) for more details.
Founded in 1936 as the U.S. Naval Pensacola Air Station Federal Credit Union for Civil Service Employees, the original FOM did not include the military personnel stationed at NAS Pensacola. It was nearly 25 years before the military became eligible for membership, and by that time, the Pen Air Federal Credit Union name had been in place for seven years. Pen Air is currently Florida’s 14the largest credit union, with more than 108,000 members and assets in excess of $1.5 billion.
How the Add-On CD Compares
When compared to 141 similar length-of-term CDs tracked by DepositAccounts.com, which require a similar minimum deposit ($5k or less) and are available nationwide, Pen Air Federal Credit Union’s 15-month Add-On CD APY* currently ranks second. The low minimum initial deposit and unlimited number of deposits allowed throughout the term makes the 15-month Add-On CD quite competitive.
The above rates are accurate as of 6/3/2020.
To look for the best CD rates, either nationwide or state-specific, please refer to our CD Rates Table page.
*We continue to work to keep our rates up-to-date, but there have been just too many rate cuts for us to process quickly. For the time being, please be aware that the rates listed at DepositAccounts.com may not reflect the latest rates published by the banks and credit unions.
Can't tell you the number of times I had to tell the CSR how things work at their own FI.
But they're not all bad. Every now and then I come across an exceptional CSR and learn something new.
You have to be really careful. Asking CSRs questions when wrong answers could potentially cost you a lot of money is like walking through a field of landmines.
What a CSR told me confirms what you said.
He said they charge a fee of $2.95 for every ACH withdrawal regardless of where it was initiated.
pua said no fee if transfer is initiated outside of PenAir
"I don't think that department is in today. But you can leave them a message."
That means that you get whatever rate is in effect at the time they receive the funds and you can't even try to expedite the transfer by wiring them from the other FI.
I hate this process. I don't feel comfortable signing deals when I don't even know one of the most important terms... the interest rate. Bank deposits are supposed to be the no risk option and that's why they pay no risk premiums. This makes it risky without the premium.
It continually asked for it then dropped the call. To reach customer service use extension 7100. I did get my problem solved. The paperwork is about 50 pages long!
It's a conundrum. The sender is okay with sending wires but not OND. The receiver is okay with receiving OND but not wires.
However, I solved this in another way that I cannot currently disclose. We'll see how she flies.
I find many CSRs use the terms "email" and "secure email" interchangeably. I always ask for clarification. I don't send or receive anything unless it's by secure email.
A month or two ago I had an FI say it was going to send some confidential documents by secure email and they sent it by regular email. PS my own lawyer did that to me too! Had to educate her.
Identity theft is not fun. One of the criteria I use to evaluate FIs is their tech and security savvy. That one got an "F." I don't recommend sending confidential or identity documents by regular email.
If you have a negative return it will be less negative with a 1.50% CD than with a 1.40% CD.
Other posters have laid down the rules. And they mean it! NO TALKING ABOUT STOCKS.
You need to do your research beforehand so you know what you want and have questions lined up. I took the precaution of beginning an online application just to see what was needed. I saw that I would need to scan my driver license, and 2 recent bills or bank statements to prove my current address, to be prepared to upload them. Aside from that, the application also looked confusing. They do have a toll-free number, so I phoned for information. Along the way the CSR said that if they change the rate it is done on Wednesdays. And they give a 15 calendar-day rate lock (including the day you open the account) to complete the funding. But your funding will go into a basic savings account where it must sit for 5 business days before it becomes available to apply it to the CD -- yes, even though it's an internal transfer from savings to CD. Then there's the delay getting the money sent out from the other bank after closing the CD. So I decided to open the CD on Tuesday, the day my other CD matured, to beat any possible rate change at PenAir, and hoped I could actually get the money to my new PenAir savings acct within a week and then wait a week for it to become "available" for the CD. CSR said they would help guide me by phone through the online application.
When I phoned on Tuesday I got a different CSR, who was just as helpful and perhaps even more knowledgeable than the previous one. CSR said forget the online application; and proceeded to ask me questions allowing CSR to fill out the form for me while we were talking; and also put me on hold and got approval from boss to extend the rate lock in case the money transfers weren't quick enough. I got a direct email address for CSR at the bank's website, and uploaded my scanned documents. Then I decided to avoid all the delays and spend the $15 to do a wire transfer for the CD principal amount plus the $25 required for the mandatory share savings acct plus the $15 incoming wire transfer fee. I sent the wire that same day and sent email to CSR to look for it and ask please open the CD as promptly as possible. Result was: I got the CD on that same Tuesday; and it showed up on my account on the PenAir website on Tuesday. Wow! CSR also emailed me an encrypted certificate with CD acct#, term, maturity date, etc.
On Wed. I sent email to CSR to choose the option to have monthly interest paid into the basic "share" savings account, and got confirmation by reply email. I had heard that there's a fee of $2.95 for any outgoing ACH transfer; looked at fee schedule and there it is. I wanted to send the monthly interest to outside bank. So I phoned PenAir and got a brand new (3rd) CSR, and discussion turned out that ACH fee is only when PenAir does the work -- outside bank can initiate ACH pull with no PenAir fee for allowing it; so I will set up recurring pull for amount safely less than the lowest expected monthly interest (like February); and go to sleep for almost 2 years.
All 3 CSRs were friendly, knowledgeable, helpful -- especially the middle one who helped me through the application process and handled the incoming wire and set up the CD, all within about 3 hours. And so, dear readers, do your homework, be prepared, and you will receive excellent service from PenAir. By the way, they actually pay for you the one dollar membership fee to join the charity that makes you eligible for credit union membership; and there's zero delay while joining. This is a very classy credit union; my privilege and pleasure to join them; looking forward to next time I have money for another CD. I have never had such swift, efficient, knowledgeable, friendly service even from a "real" brick-and-mortar bank or online bank.
I was told there is no rate lock on IRA accounts. The rate you receive is the rate in effect the day the account is funded.
In most cases, a rate lock is much more important on an IRA account (especially if it is going to be funded by a rollover or direct transfer) than on a non-IRA account, because in most cases it's simple to send a wire from the other FI to the receiving FI on the same day for a non-IRA account. Funding a non-IRA account on the same day you open the account, therefore ensuring the rate even without a rate lock is usually straightforward. No rate lock needed. (1)
But with an IRA account, if it is a direct transfer (or rollover) of funds from one FI to another, you have no control over how long it will take for the receiving FI to receive the funds. So if the receiving FI has a no rate lock policy, as most (but not all) do, you do not know what rate you will receive when they finally receive the funds. And in my extensive recent experience it could be more than a month after you ask the receiving FI to request the funds from the sending FI before the funds actually arrive no matter what you do to expedite it.
(1) Yes, you described a reason why a rate lock can also be valuable on a non-IRA account i.e. if you have maturing CDs that will mature before the rate lock expires. A year or so ago I used this technique to make an extremely good CD purchase. I lucked out... the timing was perfect. Congrats, I know that great feeling! :)
PS re their CSRs:
I don't like their phone system. It is confusing and didn't give me a good feeling about their sense of organization. I spoke to two people on two different calls. The first one seemed to be at some kind of "call center," I wasn't even sure they worked for P A or if it was some kind of an answering service. All they did is tell me I had to speak to someone else and that "department" was "probably" closed today and I should leave a message. That wasn't helpful because it would have wasted a day.
I called back later and tried again using a different phone strategy and somehow seemed to be connected to some other group. This time I ended up with a very helpful and knowledgeable CSR. She knew her stuff, it's just that the stuff wasn't what I hoped it would be (for example they don't accept IRA wires and they don't offer any IRA rate lock).
No excuse for this.
There is no reason that any FI in this day and age should not have a secure messaging system in place for exchange of documents. And its even more egregious for an FI with over a billion dollars on deposit. This is not a small CU.
This is an example of what I have been saying about how technology counts when choosing and FI. If they don't understand security I am not confident sharing my private information with them or even having them handle my money.
I had some reservations about this FI from the start so at that point I decided to send them much less money than I was planning to see how it worked out first. At this point I'm glad I made that decision.
It's not the worst FI I have dealt with (keeping in mind that the transaction isn't over yet), but it is definitely below average. If everything else goes as they promised it would I would still rate them as acceptable. But they need a competent CFO, COO or CTO to clean up their technology.