PenFed Credit Union 5-Year Certificate Now Earns 3.50% APY


Deal Summary: Money Market Certificates – 5-year (3.50% APY) and 2-year (2.75% APY), $1k minimum deposit, rates end on July 7, 2022.

Availability: Easy membership requirement

Virginia-basedPenFed Credit Union (PenFed) is celebrating the upcoming July 4th holiday with limited-time rates on two of its Money Market Certificates (MMC). Now through July 7, 2022, PenFed is offering excellent rates on the 5-year MMC (3.50% APY) and 2-year MMC (2.75% APY). Either MMC can be opened with a $1k minimum deposit, with no stated balance cap.

4.20%$1k-PenFed Credit Union2 Year Money Market Certificate
4.10%$1k-PenFed Credit Union2 Year IRA (Traditional, Roth, SEP)
4.10%$500-PenFed Credit Union2 Year CESA
3.80%$1k-PenFed Credit Union5 Year Money Market Certificate
3.70%$1k-PenFed Credit Union5 Year IRA (Traditional, Roth, SEP)
3.70%$500-PenFed Credit Union5 Year CESA
Rates as of March 4, 2024.

The 2-year and 5-year MMC are also available as IRA Certificates (Traditional, Roth, SEP, and CESA) earning APYs a uniform 5 bps lower. The Traditional, Roth, SEP require a $1k minimum opening deposit, while the CESA requires a lower $500 minimum deposit.

As stated in the Money Market Certificate Application, the Early Withdrawal Penalty (EWP) for terms greater than six months reads as follows:

2. Certificates Having a Term Greater Than Six Months

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

    b. 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.

PenFed reserves the right to require a written notice of up to 60 days of the intention to withdraw funds pertaining to this certificate.

The EWP is definitely punitive, but at least the penalty will not eat into the principal. The worst-case scenario is the loss of all earned interest – nonetheless, the principal will remain intact. An early withdrawal from a 2-year MMC in the first year would result in a loss of all dividends earned during the first 12 months. Any early withdrawal following the 12 months would result in a loss of approximately 7 months of dividends.

A 5-year MCC will also forfeit all dividends earned in the first 18 months, with any early withdrawal following the 18 months resulting in loss of approximately 18 months of dividends.

According to the Disclosure section at the bottom of Money Market Certificates page,

For all certificates funded by ACH, funds cannot be withdrawn within the first 60 days of the account opening.

On the other hand, PenFed continues to allow penalty-free partial withdrawals of IRA MMCs for members over the age of 59 1/2. The following is an excerpt from the IRA MMC 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 withdrawal policy could possibly be one of the reasons why PenFed now keeps its IRA MMC rates five bps lower than its standard MMCs.

Funding and Distribution of Funds

Funding an MMC can be done by ACH, wire transfer, or check. PenFed does not participate in the CO-OP Shared Branch network.

Earned dividends can be added back into the MCC; transferred to a Regular Share, checking, or Money Market Savings account; or distributed by check to the address on file.

Maturing funds can be distributed through an ACH transfer (this is new), by check to the address on file, transferred to a PenFed Regular Share, checking, or Money Market Savings account, or rolled over into a new certificate.

Unlimited beneficiaries can be named, with assigned percentages available. Social Security number, full legal name, and physical address are required for each beneficiary.

Renewal Policies

As stated in the Money Market Certificate Disclosure,

At the time of establishing a certificate, you may elect to have your certificate automatically renew. You may change your renewal selection any time during the term of the certificate, but prior to the maturity date.

    1. Automatically Renewable Certificates – If you selected this option, your certificate will automatically renew at maturity. There is no grace period during which penalty-free withdrawals may be received following the maturity of this certificate.

    2. Non-Renewable Certificates – If you selected this option, your certificate will not renew automatically at maturity. If you do not renew the certificate, the funds in the certificate will be transferred to your Regular Share account, checking account, or MMSA, according to your selection, and will earn dividends based on the dividend rate then in effect for that account. If you elected to have your certificate funds paid to you, your certificate will no longer earn dividends after payment.


Headquartered in McLean, Virginia, PenFed Credit Union’s field of membership (FOM) had been open to almost every U.S. citizen or resident alien for many years, with a long list of ways to qualify. For those who did not qualify through residency, employment, or military relationship, joining one of two charitable organizations provided a pathway to PenFed membership.

Determining PenFed membership eligibility has become moot: the only requirement for joining is a $5 deposit in a Savings/Share account.

The Membership Application has been streamlined down to three simple steps.

Step 1 – Eligibility – Good news! PenFed membership is open to everyone, including you.

Step 2 – Provide Your Info – Enter your name, phone number, email and address to get started.

Step 3 – Open An Account – Open your savings account with just a $5 initial deposit and you’re a PenFed member!

Joining PenFed and/or opening a Money Market Certificate can done online or at any of the 39 full-service branches located in California, the District of Columbia (3), Florida (3), Georgia (2), Hawaii (3), Maryland, North Carolina, Nebraska (2), New Jersey, New York (4), Pennsylvania (2), Texas (10), Virginia (5), and Wisconsin.

You will need to maintain a $5 Savings/Share Account as part of your PenFed membership.

PenFed participates in the Allpoint ATM network providing members with access to 85,000 surcharge-free ATMs at large retailers such as Target, CVS, and 7-Eleven.

Credit Union Overview

PenFed Credit Union has an overall health grade of "A+" at, with a Texas Ratio of 2.87% (excellent), based on March 31, 2022 data. In the past year, PenFed has increased its total non-brokered deposits by $4.34 billion, an excellent annual growth rate of 21.47%. Please refer to our financial overview of PenFed Credit Union (NCUA Charter # 227) for more details.

Established in 1935, PenFed Credit Union is currently the third largest credit union in the nation, with more than 2.7 million members and assets in excess of $35.3 billion. PenFed’s charitable organization, the PenFed Foundation for Military Heroes,

is a 501(c)3 nonprofit with a mission to empower military service members, veterans and their communities with the skills and resources to realize financial stability and opportunity. Since 2001, the PenFed Foundation has provided more than $38.5 million in financial support to more than 140,000 military families. Thanks to the generosity of the PenFed Credit Union which pays the majority of Foundation overhead, more than 95% of each donation goes directly to support our programs.

How the 2-Year and 5-Year Money Market Certificates Compare

When compared to similar length-of-term CDs tracked by that are available nationwide and minimum deposit requirements of $10k or less, no banks or credit unions have higher rates than currently offered on the PenFed Credit Union 2-year and 5-year Money Market Certificates. The following tables compare the 2-year and 5-year MMCs to the two highest-rate CDs from other credit unions and the two highest-rate CDs from banks.

The above information and rates are accurate as of 6/23/2022.

To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.

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

  |     |   Comment #1
“The EWP is definitely punitive,…”. And it is a DA advertiser.
  |     |   Comment #11
Is this a good c.u. That allows monthly withdrawals, if not who does, thank you?
  |     |   Comment #2
I acknowledge the resistance here to discussion of politics. But 2022 is an election year. In that spirit;

I would like to nominate this PenFed five year CD as the poorest, and most dangerous, CD unveiling of 2022. My vote will go to other CD offerings which do not lock me into a situation from which even Harry Houdini would be hard pressed to escape.

That said, it appears the potentates at PenFed believe interest rates likely could escalate from here. On that much, at least, I agree with them.
  |     |   Comment #3
Kaight, I would say Penfed and others aren't looking for people to trade their CDs and I completely understand that, that is why their penalty is so high... if you want to trade CDs you should be looking at brokered CDs.
  |     |   Comment #5
It was Ken that called it punitive. Not Kaight.
Also, it's definitely ornerous when compared to other credit unions.
Most of them have a straightforward "number of days" EWP.
  |     |   Comment #6
It is punitive, that's the point ... imo credit unions are not putting CDs out there for people to close early unless there is a good reason and to sell them to get a better rate is probably not a good reason for the credit union... if you want to play with the CDs then a brokered CD allows you to sell it whenever you want.. you can sell them for a loss or a gain.
  |     |   Comment #9
The EWPs difference between IRA and nonIRA CDs is being ignored by readers. The nonIRA CDs EWP are punitive b/c it is only a 5 point spread in interest rates which IRA CDs don’t have. In other words PF thinks that the true cost of an EWP is a mere 5points…that should be the EWP for nonIRA CDs.  It’s unethical for PF to charge more than 5 points as the EWP for its CDs!  Think about it!!!
  |     |   Comment #10
"It’s unethical for PF to charge more than 5 points as the EWP for its CDs!"


The EWP policy is clearly disclosed. So how is it unethical for them to charge any EWP they choose to charge?

And what does it have to do with the IRA versus the non-IRA?

They probably pay a lower APY on the non-IRA because IRA accounts require more administration for them and that's an extra cost.

But what is the connection you are making?      
  |     |   Comment #13
Its unethical to Choice because he believes that all CDs issued by any FI in the world should not have an EWP. I have never seen a person so hung up on EWPs as him. I believe that he thinks that banks should not be allowed to make money (at least off of his money). But most people by CDs as term investments and EWPs are not a concern. I have had 100s of CDs in my life, never needing to cash one out early.
  |     |   Comment #15
"So how is it unethical for them to charge any EWP they choose to charge?" Yep and even if disclosed does not make it right to charge two different EWPs for substantially the same debt issue. If non-disclosed that would be a bigger problem. And, P_D you are now saying they have a lower EWP for non-IRA CDs really?? Would you share where you see that? Finally, why not ask DA why it is punitive in one situation....
  |     |   Comment #18
Choice, I mean no disrespect but I often find your comments indecipherable. I don’t know if English is your second language or something else is going on. Either way I don’t mean this disrespectfully. But when you couple that with your extremely impolite manner of conversation, it makes it even harder to glean what you are getting at. I personally don’t care about whether you are polite or not, I only care about peoples’ ideas here, not their demeanor. But if persuading people is your aim, I think you would succeed with more people toning down the rudeness.

I also know that we disagree on just about everything political, and that’s fine.

Having said all that, there have been a few times when I was favorably impressed with points you made. If not for that I wouldn’t be responding at all. So when I asked my previous question, it was with a sincere desire to try to understand your point. But so far, I still don’t. Except maybe for the part where you apparently feel that other people should be forced to risk their capital and work for less profit than would induce them to voluntarily choose to do so. You seem to be saying you feel they should be forced to do just that. I can’t agree with you on that one, but having heard your political positions don’t see that view as a surprise.

As to your question to me:

“And, P_D you are now saying they have a lower EWP for non-IRA CDs really?? Would you share where you see that?”

It appears you misread my comment. What I said was:

“They probably pay a lower APY on the non-IRA because IRA accounts require more administration for them and that's an extra cost.”

I did not say that the non-IRA CDs have a lower EWP.

There is an unrelated typo in that sentence though. It should have read…

“They probably pay a lower APY THAN the non-IRA because IRA accounts require more administration for them and that's an extra cost.”

So it looks to me that the only point you were making was one I disagree with. I was hoping there was more.   
  |     |   Comment #30
"extremely impolite manner of conversation"
The king of diatribe says that?
Are you kidding me?
  |     |   Comment #41
@PD#18 I think some people can't get past the politics so tend to be snarky and disagree with any ideas anyone on our side of the political spectrum may have. I do have to give Milty props for trying look past politics when discussing finances though.
  |     |   Comment #57
Thanks, d1. Also, since I am financially conservative, I think we likely agree on various political issues as well.
  |     |   Comment #28
Unless PENFED has changed it, you used to be able to make penalty free withdrawals from the IRA CD's if you past a certain age.
  |     |   Comment #34
#28....I don't know about Penfed but I know Navy Federal lets you take accumulated interest out of their regular CDs and their IRA CDs
  |     |   Comment #14
Does PenFed waive its EWP for CDs held in Traditional IRA accounts if members are ages 59.5 yrs and older? Or for members who have reached RMD age, at least with respect to their annual RMD amounts?
  |     |   Comment #43
#14, “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.”
  |     |   Comment #29
Say what?
If it's a posted policy, I don't understand how it's unethical.
Onerous, yes.
Think about it.
Bold, Underlined,Three Exclamation Points.
  |     |   Comment #4
Agree, not a good choice in a rising rate environment.
  |     |   Comment #45
I remember getting 5% on a 1 year CD at both Washington Mutual and Country Wide
Forbes: CD RATE FORECAST Published: Jun 7, 2022
Article states Ken Tumin forecast: Five-year CD rates could be as high as 5.00% by late 2023
  |     |   Comment #7
I like this 5 year deal for part of my money. I have been earning only .40% on it in the bank for over a year now.
  |     |   Comment #8
I can't wait to open this cd. as I think it is a good opportunity to get a cd that is at least in the middle of what's to come... maybe 4 or 5% cd... who knows
  |     |   Comment #12
I see these recent 5 year CD bank offerings as a game of chicken. Nope I'm not blinking they need to get serious and step off with 4% or better before they will get a dime of my money. I prefer not to break a CD and just time them to maximize yield. I can't even start a ladder with these low rates.
  |     |   Comment #16
While you wait you are losing potential income. You may well need more than 4% to catch up that loss.
  |     |   Comment #17
Good point, MidA And more time! The time factor is not being fully appreciated
  |     |   Comment #27
What loss? I'm already making this rate or beating it with add-on CDs, capped 5-6% savings accounts and short term CDs bought with a 2% cash back credit card. Even my liquid cash is earning 2.28% APY now. Like I said I need 4% min. before even considering another long term CD.
  |     |   Comment #39
Yeah FirstNation I'm really behind collecting all those monthly tax advantaged dividend checks for 30 plus years. I prefer to buy stocks that pay me to hold them which is why I like REIT's as they must pay out 90% of profits to shareholders by law. I still have some REIT's that pay a large dividends however not those with 2x leverage anymore. Sometimes lessons require you to have skin in the game. I'm still learning.
  |     |   Comment #35
It really depends on what percent of your total savings you have sitting at less than 3.5% in terms of calculating loss. But I agree it still seems premature to invest a large percentage at this point in time at 3.5.
  |     |   Comment #19
This may be near the peak in this interest rate cycle seeing as recession is right around the corner. 5-30 year Treasury rates are already in decline
  |     |   Comment #31
So, you're expecting inflation to average below 4% over the next 5 years?
  |     |   Comment #20
Why not just purchase a 5 year brokered CD? Schwab has some at 3.45%.
  |     |   Comment #21
Why is that better than PenFed at 3.5%?
  |     |   Comment #22
PenFed's CD is 3.5% apy and Shwab's brokered CD is 3.45% apr... pretty close to the same rate, not sure but Shwab's might be .01% higher.
  |     |   Comment #53
I seem to recall that the interest on brokered CDs is paid out periodically, throughout the year. Which means that there is no compounding.

Which means that PenFed's 3.50% APY, over five years, produces a significantly superior return when compared with a flat 3.45% brokered CD.

Here's the late-night math I'm basing this on
[please feel free to verify]

After five years:
$100k brokered @ 3.45% = $3,450 * 5 = $17,500
$100k @ 3.5% APY = $18,768.63
. . . which is equivalent to an uncompounded, flat 3.753% five-year return on principal
  |     |   Comment #54
NYCDoug (#53) -- I think you're missing something. You are assuming that interest paid out on a brokered CD will be placed in an account with an APY of 0.00%, and will remain in that account until the certificate matures.
  |     |   Comment #58
Alan...The other thing he is not taking into consideration is some people don't let their CDs compound, they take the interest that is rolled off and they live off it.
  |     |   Comment #56
NYCDoug #53

You raise an important point, and a complicated one.

The APY on a CD purchased directly from an FI is not necessarily directly comparable to the “yield” on a brokered CD. A brokered CD, for example, if purchased on the secondary market may be purchased at above or below par. The price at which it is purchased will affect the yield. In addition, a CD purchased directly may have a different cash flow pattern than a brokered CD sold at above or below par. And it may also have different tax consequences since the gain or loss at maturity of the brokered CD is a capital gain or loss, taxed at different rates than the interest.

Also, with a brokered CD, there may be different yields quoted depending on the terms of the particular security. For example there may be a yield to call quoted in addition to a yield to maturity.

There are a lot of nuances. But I think the general observation that you cannot directly compare the yield calculation on a brokered CD with the APY of a direct CD is accurate. It’s not apples to apples.

In the case you cited I think your calculations are correct. You can think of it as APR versus APY. Since the interest on the brokered CD is not compounded, the quoted yield represents simple interest similar the the “APR” on a directly purchased CD. But the PenFed direct CD compounds interest daily (I did not check this but I am assuming it from comments I read here). Therefore the 3.5% APY on the PenFed CD is a yield which includes the effect of compounding at the stated compounding interval. But the 3.45% yield on the brokered CD is simple interest without considering the effect of compounding. It is similar to a direct CDs “APR.”

In the example you gave, I also think alan1’s point is correct. The coupon payments on the brokered CD can be reinvested and if the rate of return is greater than zero, it would increase the total return possible to the date of maturity. But the final result in terms of dollars would depend on what return you can earn on the reinvested interest payments. You could end up with less or more than you would with the PenFed CD.

Complex analysis with many unknowns. I don’t think you can make a blanket statement about which of these two options is superior as there is a speculative aspect to the comparison in addition to the relative pros and cons of purchasing a direct CD versus a brokered CD and how they fit the buyer's needs.  
  |     |   Comment #59
NYCDoug...the CDs are just about the same if you look at apr... some people don't let their CDs compound , they take their interest and use it, others like myself would find somewhere to invest the interest from a brokered CD, might even do better investing those dividends myself.
  |     |   Comment #24
You can sell the CD in the secondary market at a profit (if interest rates drop) or a loss if interest rates rise, if you want to break the CD. Or, just hold until maturity.

There are no withdrawal penalties. It just gives you more flexibility.

If the Penfed CD had only a 6 month penalty, I would consider it.
  |     |   Comment #23
For this CD, there is no need to distinguish between year 1 and years 2-5. The EWP throughout the term of this CD is equivalent to the LOWER of the following two amounts:

(1) 5.63% of the principal AND
(2) Total interest earned up to the date of early withdrawal

So, the EWP will not eat up any part of the principal.
  |     |   Comment #26
Not sure where you got the EWP for Penfed.

This is from the Penfed site:

12-, 15-, 18-, 24-, 36-, 48-, 60- and 84-month certificates:

Within 365 days from the open date of the certificate, the penalty will be the last 365 days of dividends earned.

After 365 days from the open date of the certificate have elapsed, the penalty will be 30% of gross amount of dividends that would have been earned if the certificate had reached maturity.
  |     |   Comment #37
mffarrell, there is an inconsistency in the PenFed site regarding EWP’s. What you are quoting is from the FAQ section of the PenFed site. However, the disclosures section, on the Money Market Certificates page, states:

“Early Redemption Penalties:
Penalties are imposed for early withdrawal of Money Market Certificates. This will reduce earnings on the account. You must provide your request in writing.
Please refer to the Money Market Certificate Application for further details…”

The Money Market Certificate Application describes the EWP for a 5 year certificate as follows:

“2. Certificates Having a Term Greater Than Six Months

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

b. 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.”

NOTE: This description of the EWP is also what Ken quoted in his post above.

In my original post, I converted all this into a numeric value as follows:

Full interest earned over 5 years, if certificate is held to maturity = 18.77% of principal (1.035 raised to the power of 5, Minus 1)
EWP = 30% of the full interest over 5 years = 30% of 18.77% = 5.63% of principal BUT subject to the limitation that the EWP cannot exceed the actual interest earned.

I hope this makes my original post more clear.
  |     |   Comment #42
Wow…an analysis based upon an effective rate at a point of time! Very refreshing…thanks. DA are you listening…your customers need more relevant info!
  |     |   Comment #46

I like your restatement of the terms of the penalty.  Good conceptual grasp.

The only comment I have on it is that your calculation assumes annual compounding. Does this CD have annual compounding? If not the 5.63% figure will not be accurate although may still be a reasonable estimate.

I did not research this CD so I don't know the answer to that question although annual compounding would be unusual.

Either way, I like what you did.      
  |     |   Comment #50
P_D, This certificate has daily compounding of interest according to the PenFed site, but the frequency of compounding is already (and always) reflected in the certificate's APY (Annual Percentage Yield). For each year of this certificate, the APY is 3.50% and it is assumed that the earned interest is not withdrawn at any point during the term. So, you can use the APY as an annual interest rate which is compounded annually for 5 years.
I did verify my calculation of interest earned against the examples given on the PenFed site before posting my comment.
  |     |   Comment #52
That is correct Reader1. Good job.
  |     |   Comment #38
I feel very stupid. When rates were super low, I decided to open cds at penfed paying 0.75 and 1 percent. Now I want to close them and get the 3.5. I will lose all the dividends on both of them
  |     |   Comment #40
Risk/reward analysis…past is a sunk cost …future is…. And if rates go to 5% or whatever, what are you going to do? Change advisors now or then?  Ethics are a non-issue  (to some).  Finally perhaps the issuer wants to keep you and allow an uptick in rates…Negotiation 101 revisited 
  |     |   Comment #48
#30 - Well, comment #40 is one approach. Here's another -

1) First - you are not stupid. Even Warren Buffet has made some mistakes (and he's acknowledged several of them in his annual reports to shareholders). Is Buffet stupid? One thinks not, based upon the historical record.

2) Next, gather all statements, documents (especially Terms and Conditions docs.), etc., paper and digital, that you have dealing with these CDs. Make notes of all conversations (or recollections of prior conversations) that you, or anyone else authorized to speak for you, have made with PenFed regarding these CDs. What did the PenFed reps. tell you?

3) Next - why exactly do you say “I will lose ALL dividends on both of them”? To me this sounds unusual, although admittedly I haven't held PenFed CDs for some time. Are you sure about that? Do the T&C docs say that? Research exactly what the basis for that statement is. Search for all articles/posts re. PenFed CDs. Note all mention of restrictions on dividend payouts, especially for CDs that are “cashed out” early.

4) Explore any “hardship case” rules that might be mentioned in PenFed's docs. which might allow you to end the CDs early, ideally receiving all dividends accrued and having the EWP waived.

5) Only then (when you have your ducks in a row) contact PenFed, and see what can be done. State that your goal is to be able to remain a PenFed customer and to invest in “new” PenFed CDs.

6) If their solution doesn't satisfy you, use the tools for breaking a CD and reinvesting the funds in a new higher-rate CD for a first approximation. But also do the math by hand - because no automated tool can foresee all fees, differences in interest calculation, etc. Confirm your understanding of costs with PenFed before you have them “do the deed”.
  |     |   Comment #74
Excellent post! What is your opinion of no EWP at PenFed, if the interest has been paid to the customer?
Per PenFed. "Interest may be withdrawn before maturity". Per PenFed, "there is no reduction in principal.
  |     |   Comment #51
Hank..... Here is the simpler version:  correction
 Look at the bright side, it's only a .75% cd and a 1% cd, take the loss off your taxes and chalk it up to a learning experience.
  |     |   Comment #66
If in an IRA, rollover within the IRS time requirement
  |     |   Comment #67
The one good thing about a loss in an ira is the government takes part of that loss too...unless it's a Roth...;)
  |     |   Comment #55
Hank, if you recently opened them, less than 1 yr it is to your advantage to close them out and loose the interest for the time you opened it... I did yesterday opened 4cd at the 3.50 % and closed out and lost interest for the yr. or months I had them open... Go do it now
  |     |   Comment #61
thank you for your input and also thank you to the others who responded. I will follow your advice
  |     |   Comment #44
This offering is not a CD. It is a Money Market Certificate. Whatever that is.
  |     |   Comment #47
Credit unions call this kind of account a Certificate (or Share Certificate) and banks call the account a Certificate of Deposit (CD).
  |     |   Comment #60
While I am fond of Pen Fed in general, and have one of their credit cards, I would not get a CD from them because of their punitive early withdraw penalties which are as follows for longer term CDs.
a. If redeemed within the first year, all dividends will be forfeited.
b. 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.
Even if one has sufficient funds so as not to worry much about EWPs, it still reduces the value proposition, especially when there are other high yielding CDs without the same punitive early withdrawal penalties.
  |     |   Comment #69
it is very difficult to close a cd early at penfed. I am trying to close 2. You can't do it online nor over the phone. I had to send them a written note saying that I want to do it. I sent though their website on Friday but they haven't reviewed it yet
  |     |   Comment #70
I sent them the notes they requested on Friday. They still haven't closed the CDs
  |     |   Comment #71
So in light of longer term interest rates declining over the past several days does this 5 year Pen certificate have more merit at this point, despite the punitive EWP?
  |     |   Comment #73
Just out of curiosity, has anyone received the interest monthly or withdrawn all of the interest, and then closed the CD without an EWP? Per PenFed, "interest may be withdrawn before maturity." There would be no interest to collect an EWP. Per PenFed, "there is no reduction in principal amount" and no loss of principal.
  |     |   Comment #75
You asked somewhere else what is required to close a CD at PenFed. I made my request by phone, but PenFed sent me a form called 'Request for Early Redemption of Share Certificate' which I had to print, sign by hand, scan and return to them via secure email.

It's a very simple document. It doesn't say anything about the EWP. I just states that you want to do an early redemption with the certificate account number and effective date.

I can't answer your question about what happens if you first withdraw your interest. I did mine before discovering your experience at GTE, so PenFed took a few months interest as EWP.
  |     |   Comment #76
Fred, you added to the form something to the effect, “no EWP.” Right? Next time?
PenFed Credit Union Pushes CD Rates Upward Again
Deal Summary: Money Market Certificates – The most competitive of the new rates: 18-month (2.05% APY) and 7-year (3.00% APY), $1k minimum deposit.

Availability: Easy membership requirement

PenFed Credit Union (PenFed) started the month by raising the rates on all its Money Market Certificates (MMC), with increases of 10-30 bps. While all of the PenFed MMCs were rate leaders two months ago, only two (18-month, 2.05% APY and 7-year, 3.00% APY) currently sit at the top of their respective term-length categories.

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PenFed Credit Union CD Rates Soar To Rate Leading Levels
Deal Summary: Money Market Certificates – 18-month (1.35% APY), 2-year (1.60% APY), 3-year (2.10% APY), 4-year (2.25% APY), 5-year (2.50% APY), and 7-year (2.75% APY), $1k minimum deposit.

Availability: Easy membership requirement

A month ago, PenFed Credit Union (PenFed) raised the rates on all its Money Market Certificates (MMC), with increases of 5-10 bps on shorter-term MMCs and 35-50 bps on longer-term MMCs. Another round of rate increases was announced yesterday, with the longer-term APYs gaining between 70-90 bps; the shorter-term APYs saw more modest increases...

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PenFed Credit Union Has Across The Board CD Rate Increases
Deal Summary: Money Market Certificates – 1-year (0.90% APY), 2-year (1.35% APY), and 5-year (1.80% APY), $1k minimum deposit.

Availability: Easy membership requirement

This morning, PenFed Credit Union (PenFed) raised the rates on all its Money Market Certificates (MMC), with increases of 5-10 bps on shorter term MMCs and 35-50 bps on longer term MMCs. These increases have resulted in the highest APYs in about two years.

While a 50 bps increase is definitely eye-catching, PenFed’s short-term MMC rates are still very competitive, particularly given the current popularity...

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PenFed Ups 18-Month and 2-Year CD Rates To Market-Leading Levels
Deal Summary: Money Market Certificates – 18-month (1.15% APY) and 2-year (1.25% APY), $1k minimum deposit.

Availability: Easy membership requirement

This morning, PenFed Credit Union (PenFed) significantly increased rates on two of its Money Market Certificates (MMC), which combine with the two special holiday MMC rates that PenFed introduced in December. Three of these four MMC rates are being highlighted on PenFed’s home page,

The new “through the roof” rates belong to the 18-month MCC (1.15% APY) and 24-month MCC (1.25% APY). The old “through the roof” rate, which is...

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PenFed Credit Union Offers Special Holiday Rates On Short-Term CDs
Deal Summary: Money Market Certificates – 12-month (0.85% APY) and 15-month (1.00% APY), $1k minimum deposit.

Availability: Easy membership requirement

PenFed Credit Union (PenFed) is definitely spreading some holiday cheer with two competitive Money Market Certificates (MMC). Following recent rate increases, the 12-month MMC now earns 0.85% APY, with the 15-month MCC currently earning 1.00% APY. Either MMC can be opened with a $1k minimum deposit, with no stated balance cap.

As stated on the Money Market Application page, the Early Withdrawal Penalty (EWP) for...

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