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.
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.
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.
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.