Two Small CD Rate Increases at PenFed


Deal Summary: Rate increases: 15-month (1.71% APY) and 2-year (1.87%); $1k minimum deposit

Availability: Easy membership requirement

For those hoping for a repeat of 2013, it’s a disappointment. PenFed Credit Union (PenFed) did have a couple of certificate rate increases for the start of December, but the rate increases are not close to what we saw at PenFed in December 2013. PenFed continues the trend that we have seen all year: short-term and mid-term rates rise as long-term rates stay the same. The only two certificate rate increases today at PenFed were on its 15-month and 24-month terms. The 18-month certificate rate remains the same and is still competitive:

  • 1.71% APY 15-month (was 1.61%)
  • 1.77% APY 18-month (no change)
  • 1.87% APY 2-year (was 1.82%)

PenFed long-term rates remain the same, and they continue to be below the rates that you can get at several internet banks. Please refer to our PenFed's CD rates table for the full listing of CD and IRA CD rates.

The minimum opening deposit is $1k, with no stated balance cap. PenFed calls these Money Market Certificates, but they are essentially CDs. All of the above terms except for the 6-, 15- and 18-months are available as IRAs (Traditional, Roth, and CESA) but with rates that are 5 bps lower.

Last year, PenFed’s Early Withdrawal Penalty (EWP) 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.

As you can see, the EWP is harsh. For a 5-year term, 30% of total dividends is 18 months’ interest.

On the positive side, PenFed continues to allow penalty-free partial withdrawals of IRA CDs for members over the age of 59 1/2. The following is an excerpt from the IRA CD disclosure:

Partial withdrawals for members over the age 59 1/2 (including Required Minimum Distributions) and qualified distributions regardless of age (including Disability) may be processed from IRA certificates without incurring an early redemption penalty.

This may be one reason PenFed now keeps its IRA CD rates 5 bps lower than its standard CDs.


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 active/retired 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

Selecting Option #7, "Other," provides information about joining PenFed through membership in either Voices for America’s Troops ($17, one-time only dues) or the National Military Family Association ($17, 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 branches located in the District of Columbia (6), Florida, Georgia (6), Hawaii (3), Maryland (4), North Carolina, Nebraska, New York (2), Tennessee, Texas (8), Virginia (9), and Puerto Rico (1).

Credit Union Overview

PenFed Credit Union (NCUA Charter # 227) has an overall health grade of "A" at, with a Texas ratio of 3.57% (excellent), based on June 30, 2017 data. In the past year, PenFed has increased its total deposits by $1.73 billion, an excellent annual growth rate of 10.85%. 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 $22 billion.

How the Money Market Certificate Compares

I typically group 15-month CDs with 18-month CDs when doing comparisons. For this comparison, I’ll compare PenFed’s 15-month CD to 12-, 13- and 14-month CDs. Based on this comparison of 216 CDs tracked by, there are 8 banks and credit unions that offer higher rates than PenFed’s 15-month CD. The highest is the 12-month Jumbo CD rate at Advancial (which just went up by 3 bps). Below is a sample of these:

The above rates are accurate as of 12/1/2017.

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

Related Pages: 1-year CD rates, 5-year CD rates, nationwide deals

Chickenfoots   |     |   Comment #1
I am hoping you have some good news for us soon, Ken. I imagine a large number of us have those 3% CDs expiring very soon.
Bozo   |     |   Comment #2
The last of my 3.5% seven-year just went "poof". Rolled it over into (please, no giggles) 2.2%. I look at the bright side. It's an IRA CD. I can, if I wish, take a partial withdrawal with no EWP.
Bozo   |     |   Comment #3
Further to my comment #2, the partial withdrawal "perquisite" for IRA CDs is just about the only thing that makes PenFed marginally attractive.
Rickny   |     |   Comment #6
You renewed the 7 year at 2.2% with Penfed?

I just closed a NASA CD and had the funds sent to my share savings. To my surprise the transfer out limit is 10K per day. So need 4 days to get all the funds out.
Bozo   |     |   Comment #9
Rickny (re comment # 6) I look at my IRA CDs at PenFed as a glorified savings account. I can make partial withdrawals with no penalty whenever I want.
Rickny   |     |   Comment #10
I'm many years off before I have withdrawal from my IRA or 401Ks so I look at things differently.
DOA   |     |   Comment #28
A little trick I learned on this is to setup a link with an external checking account at another bank or credit union that has larger transfer limits. Then make the transfer transaction at your external checking account to withdraw the whole amount from the credit union. In your case, that would have been NASA. You probably should check with NASA first before doing this to be sure they will accept a larger transaction being pulled from the other institution. I know this is the way it works at PENFED as they too have daily limits on transfer out amounts.
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Rickny   |     |   Comment #4
I have a 3% and a 5% with Penfed. I don't think they will be rate leaders anymore. The 5% is a 10 year CD that matures around 2021. Not holding my breath.
Ratesaver   |     |   Comment #5
Just a note: The above info on branches leaves out Pennsylvania with 4 branches. With the take over of Tobyhanna Army dep.
scottj   |     |   Comment #7
Have a feeling they will have to offer something good in a year, I'm sure many of us opened those 3.04% CDs that will mature then. And still 3 years left on the 5% :)
DCGuy   |     |   Comment #8
Pen Fed gave me $50 for making at least $1000 purchases using their credit card for the months of October and November. This time period is when the bulk of my payouts occur for insurance premiums for auto and home. So I got a small rebate for things that I normally pay for at this time of the year.
buhbye   |     |   Comment #11
I've given up on PenFed and put my money elsewhere. Their EWP is one of the worst -- bad enough to where you have to think if you want to deal with it even when they were a rate leader. Now with their mediocre rates I simply go elsewhere, as I suspect everyone here does/will.
Bogie   |     |   Comment #12
No not everyone. My IRA CD at PenFed is doing just fine. I do move other $$$ around where I can get the best rates and terms to suit my situation and never give a second thought to EWPs. A person could miss out on better rates from time to time is they worry about the EWPs.
Rickny   |     |   Comment #13
I would use EWPs as a deal breaker. Penfed rates are not leaders and the EWP is high. The one my time I did an early withdraw was with Penfed around 2011. Closed CD paying in the 2% range into a 5% CD for 10 years . Both of these CDs were with Penfed.

One positive feature with the Penfed CDs is that they allow penalty free withdrawals as Bozo noted. I have one IRA that I opened many years back. I have a pension and 401K with a match so I no longer fund IRAs.
Hello   |     |   Comment #14
Glad I did the GTE promo CD at 2.5%......And it's only 30 months (now 29). I can add to it whenever I want and as much as I want with a very short term maturity. A great deal. Makes most offers on here not too competitive....although I do appreciate them. Hopefully we will see even better deals soon.
Retired   |     |   Comment #15
need some info

Just what is the advantage/disadvantage of opening a IRA CD insted of a regular one? Were both over 70, if that matters, I don't itemize on my taxes. I do my own taxes, so I don't need any more paperwork or IRS bs to deal with.

I'm askin cause I was called by a rep that they had some 2.8% 15mo thing, but it was only IRA, not a regular CD.

I'm not looking for any write off's, I keep my income in the bracket I need, (not gona be taking it with me) and don't have anything to deduct as it is that just adds more 1040 lines to deal with.
#16 - This comment has been removed for violating our comment policy.
Dunmovin   |     |   Comment #17
Being retired you generally need earned income to start an ira. Any funds in a 401k could be rolled into one. Otherwise, you may want to talk to them since an ira generally allows penalty free withdrawals and thus they will have your ira for the term or they get any ewp...a big benefit to them if they allow you to open reg cd. Negotiate with them! Do both or.... What is the name of the bank/cu offering that rate?
Very anonymous
Very anonymous   |     |   Comment #19
If you are over age 70.5, you may no longer make new contributions into Traditional IRA accounts (the kind where you can take a deduction). You can move funds from other Traditional IRA accounts and other types of before-tax retirement accounts (such a 401k), but you may not make a new contribution.

If you are still working (or receive taxable alimony payments or non-taxable combat pay), you may make contributions into a Roth IRA account (if you are under the maximum income limit). The advantage there is that any interest you earn will be tax-free when withdrawn by you or your heirs. You will not receive any deduction for the money you put into the Roth IRA, however.
Retired   |     |   Comment #21
LOLOL, man, talk about over kill, yo sheesh, take a BP pill homey., I don't think you understood me at all.

OK from what I gather, if your 0ver 70.5, and NOT employed, you don't need, or even qualify for a IRA CD, well hell, that's ALL I needed to know in the first place. I just asked "what the big difference between them was" and weather one was better than another.

I said I don't have any deductions, never had, and Yes I'm fully retired, have been since turning 45, doing just fine btw., have taken plenty responsibility for myself, smirk,. although never had any of these IRA's, 401K's, stocks, or stacked gold or silver around the house.

Anyway thanks #19, I think you said what I need to know.
Dunmovin   |     |   Comment #22
And the name of the financial institution is?
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#25 - This comment has been removed for violating our comment policy.
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Dunmovin   |     |   Comment #27
Footnote to #22

If "Retired" retired early s/he has a large CD profolio w/o any IRA CDs...why wouldn't a bank "love" to take those funds as part of a CD rather than only as an IRA CD knowing also that the depositor would not be able to withdraw funds early like withdrawals for any IRA CD due to RMD? Something is missing here or the financial institution is.... Sounds like what I saw earlier in a post: Negotiation 101 time.
Dazed_And_Confused   |     |   Comment #23
A rep at Penfed offered you a 15 month IRA CD at 2.8%? If not, where was that offer
#20 - This comment has been removed for violating our comment policy.
PenFed Increases Rates On All Certificates

Deal Summary: Most competitive are the 18-month (1.77% APY) and 1-year (1.61%); $1k minimum deposit

Availability: Easy membership requirement

PenFed Credit Union (PenFed) increased the rates on all of its Money Market Certificates (CDs) today. PenFed typically changes rates at the start of each month, so this increase is a good sign that PenFed saw the need to do another rate hike so soon after its October 1st increase. The new rates aren’t exceptional, but they are competitive. The most competitive ones are the 18-month CD (1.77% APY) and the 12-month...

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Availability: Easy membership requirement

Many banks and credit unions having been coming out with higher rates today (see Forum). While it is common for credit unions like PenFed Credit Union (PenFed) to change rates on the first of the month, the number of institutions increasing rates seems a little higher than normal. Perhaps the last Fed rate hike is starting to have an effect.

Today’s rate increases at PenFed aren’t impressive, but it’s nice to see...

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Availability: Easy membership requirement

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  • 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...

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Availability: Easy membership requirement

Three years ago PenFed Credit Union (PenFed) kicked off December with a hot 5-year CD rate. There are no hot deals to report, but PenFed is kicking off December with some higher CD rates. PenFed raised rates on four of its short-term Money Market Certificates (their version of CDs) with the 1-year term (1.36%) being the most competitive. Unfortunately, PenFed lowered rates on its longer-term CDs. All terms of 2 years and longer now have APYs of 1.51%. It’s disappointing to see PenFed with uncompetitive long-term...

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Availability: Easy membership requirement

Today is Veteran’s Day, and on behalf of DA’s staff, I would like to take this opportunity to thank the many veterans and active service members who are part of our readership.

While not noted as an official Veteran’s Day celebration, PenFed Credit Union (PenFed) chose yesterday to raise rates on many of its Money Market Certificates (their version of CDs). Of those, the 2-year (1.46% APY) and 3-year (1.61% APY) are the most competitive. The 4-year, 5-year and 7-year rates were also raised,...

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