PenFed Kicks Off New Year with Competitive Long-Term CD Rates

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Availability: Easy membership requirement

Happy New Years! PenFed Credit Union (PenFed) has started the new year with higher long-term CD rates. PenFed has a history of offering top long-term CD deals in January, and it’s nice to see PenFed continuing this tradition. The new rates aren’t spectacular, but they are very competitive. Below is a summary of the new CD rates and how they have changed from last month.

  • 0.85% APY 6-month (no change)
  • 1.36% APY 1-year (no change)
  • 1.41% APY 15-month (no change)
  • 1.51% APY 2-year (no change)
  • 1.71% APY 3-year (was 1.51%)
  • 1.87% APY 4-year (was 1.51%)
  • 2.28% APY 5-year (was 1.51%)
  • 2.38% APY 7-year (was 1.51%)

The minimum opening deposit is $1k, with no stated balance cap. All of the terms except for the 6-month and 15-month are available as IRAs (Traditional, Roth, and CESA) but with rates that are 5 basis points lower.

APYMINMAXINSTITUTIONPRODUCTDETAILS
2.12%$1k-PenFed Credit Union7 Year Money Market Certificate
2.07%$1k-PenFed Credit Union5 Year Money Market Certificate
1.76%$1k-PenFed Credit Union4 Year Money Market Certificate
1.61%$1k-PenFed Credit Union3 Year Money Market Certificate
Accounts mentioned in this post. Rates as of March 1, 2017.

Please refer to our PenFed's CD rates table for the full listing of CD and IRA CD rates.

Last year, PenFed’s Early Withdrawal Penalty (detailed on the Money Market Certificate Application) changed and now reads as follows:

Certificates Having a Term Greater Than Six Months:

If redeemed within the first year, all dividends will be forfeited.

If redeemed thereafter, but prior to the maturity date, the early withdrawal penalty will equal 30% of what would have been earned if the certificate had been held to maturity, not to exceed total dividends earned.

Many thanks to DA reader/contributor, ChasR for his Forum post about the new PenFed rates.

Availability

Headquartered in Alexandria, Virginia, Pentagon Federal Credit Union offers membership to virtually all U.S. residents. PenFed’s online application lists the various ways in which individuals can qualify for membership.

If you meet any of the following requirements, you are eligible to join PenFed:

1. I am in the United States Military & Uniformed Services.

2. I am an employee of a qualifying organization.

3. I belong to the following association or organization.

4. I am an employee of the United State government.

5. I am a relative or housemate of someone who is eligible.

6. I live or work at an eligible location.

7. Other

Clicking on Option #7, "Other," provides information about joining PenFed through membership in either Voices for America’s Troops ($14, one-time only dues) or the National Military Family Association ($15, one-time only dues). Joining either of these associations and PenFed can be done simultaneously using PenFed’s online application.

Need another way to join? No problem!
Members of the National Military Family Association and Voices for America's Troops
are among those eligible for PenFed membership. We've made it easy for you to join
one of these associations, which makes you eligible to join PenFed.

Joining PenFed and/or opening a Money Market Certificate can also be done in person at any of 38 branches located in the District of Columbia (6), Florida, Georgia (2), Hawaii (3), Maryland (2), North Carolina, Nebraska, New York (2), Oregon, Tennessee, Texas (4), Virginia (10), Guam (2), and Puerto Rico (2).

Credit Union Overview

PenFed Credit Union (NCUA Charter # 227) has an overall health grade of "A" at DepositAccounts.com, with a Texas ratio of 2.86% (excellent), based on September 30, 2016 data. In the past year, PenFed has increased its total deposits by $1.52 billion, an excellent annual growth rate of 10.31%. Please refer to our financial overview of PenFed Credit Union for more details.

Established in 1935, PenFed Credit Union is one of the largest credit unions in the nation, with assets in excess of $20 billion.

How the Money Market Certificates Compare

When compared to the 183 similar length-of-term CDs tracked by DepositAccounts.com that require a similar minimum deposit and are nationally available, PenFed Credit Union's 5-year Money Market Certificate APY currently ranks fourth.

The above rates are accurate as of 1/1/2017.

To search for the best CD rates, both nationwide and state specific, please refer to the CD rates section of DepositAccounts.com or our Rates Map page.

Comments
Anonymous
Anonymous   |     |   Comment #1
Happy New Year
Anonymous
Anonymous   |     |   Comment #2
With PenFed's new early withdrawal penalty they are telling you... go ahead, make my day.
jimbeau
jimbeau   |     |   Comment #4
They're rates have improved considerably. However, a 5 year CD @ 2.28% doesn't sound as good as it did a couple of months ago. If they had this rate back then, I probably wouldn't have moved everything out of PENFED. At least it's a step in the right direction.
Bozo
Bozo   |     |   Comment #5
Jimbeau, I have two IRA CDs (both 7-yr at 3.5%) maturing this year at PenFed. Given this increase (not stellar, but competitive), the "stickiness" factor has increased dramatically. I'll probably roll both into the 5-yr. Custodian-to-Custodian transfers of IRA CDs are such a pain.
#15 - This comment has been removed for violating our comment policy.
Anonymous
Anonymous   |     |   Comment #6
Penfed is no longer the leader. I've been moving my money out and been getting better rates at other CUs. After my 15 month ends soon I'm sure that a rate somewhere else will be available. I'll have a 5% and a 3% left with them. The 5% is good till 2022 and the 3% till 2018. Other CUs are taking Penfed place as a leader in rates.
Anonymous
Anonymous   |     |   Comment #7
When did you get the 5%?
Anonymous
Anonymous   |     |   Comment #9
I might have put the wrong maturity date but Penfed did have a 5% CD. It may have been 2010 so the maturity date is wrong. I believe Penfed made a mistake but honored the rate. I'm sure someone will chime in.
OAG
OAG   |     |   Comment #12
It was 2010 (10 year maturity = 2020). Hopefully by 2020 there will be 5%+ rates available again.
Anonymous
Anonymous   |     |   Comment #8
I'm in a holding pattern when it comes to opening new accounts for rate chasing as I'm wary of any hard pulls on my credit while we're expecting to shop for a new home (and mortgage) in the next 6+ months. I am an existing member of PenFed; what do folks think about the 3 year CD -- is it worth locking some $ in for 3 years at 1.71% right now with rates heading up? Among the banks/credit unions places where I have accounts, this is the shortest maturity date for % in that range.
Anonymous
Anonymous   |     |   Comment #10
PenFed's 3 year CD is only .20% more than their 2 year CD at 1.51%. At this time, which appears to be a major turning point for interest rates, I would not go out another year just for .20% more.
Anonymous
Anonymous   |     |   Comment #11
You can contact an institution that you plan on opening a CD with and ask if they do a hard pull when you open a CD. Not all institutions do a hard pull. Once your a Penfed member it is easy to open additional CDs.
RJM
RJM   |     |   Comment #13
Competitive 5 year rate.
#14 - This comment has been removed for violating our comment policy.
Bondito
Bondito   |     |   Comment #19
Most of these higher rates are only slightly higher than similar maturity US Treasury notes. Between treasuries and CDs, I generally prefer the liquidity and state income tax exemtion offered by treasuries, as long as the rates are pretty close. Regarding the shorter maturities, it is not difficult to find close to 1% on money market accounts, so I'll keep my powder dry until a CD offers enough of a difference to take the risk of rate hikes after I have locked in my rate.
Anonymous
Anonymous   |     |   Comment #20
If my calculations are correct, on a 7-year CD... ...you have to hold it for 3.7 years to catch up with a 1% savings account ...you have to hold it for 5.6 years to match a 2% CD that has an 18-month EWP.
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