Vermont State Employees Credit Union Adds 6-Month CD, 3.00% APY
Earlier this week, Vermont State Employees Credit Union (VSECU) added a 6-month CD, which earns 3.00% APY. The minimum opening deposit is $500, with no stated balance cap.
The 6-month CD currently has the highest APY of any VSECU CD; the next highest rate, 2.00% APY, belongs to the 1-year CD. There is a 10-day grace period before the CD automatically renews for another 6-month term.
As stated in the Truth-in-Savings disclosure, the Early Withdrawal Penalty reads as follows:
For accounts with terms of 1 year or less, the penalty
is equal to 90 days’ interest on the amount withdrawn.
UPDATE 4/18/2019: DA reader, 111, noted that the public page for VESCU listed the 6-month CD as an "add-on" CD. I have confirmed with VSECU that is NOT an add-on CD and DA's database has been updated accordingly. Thanks, 111.
Availability
Headquartered in Montpelier, VSECU has a field of membership (FOM) that’s much wider than its name suggests: individuals, 18-years and older with a valid Social Security number, who live or work anywhere in the state of Vermont are eligible to join.
Members of The Northeast Sustainable Energy Association (NESEA) also qualify for membership. NESEA is a non-profit regional trade association with "an educational focus and mission that aligns with VSECU’s vision of creating greater environmental prosperity for more Vermonters."
UPDATE 4/18/2019: DA reader, AnnO, made the following observation in the Comments section below concerning NESEA membership:
It sounds like anyone could join the NESEA to become eligible for this CU, not just people in Vermont? (Thus this CU should be an 'easy membership' nationwide one?) It is on the pricey side for this purpose ($40-$75), but if you have a lot of money to put in the CD, could be worth it for some people.
I confirmed with CSR that membership in the NESEA nullifies the Vermont residency requirement for membership in VSECU. If you are a member of NESEA, you are eligible to join VSECU, regardless of where you live.
Relatives of current VSECU members are welcome to apply. You will be asked to provide your relative’s complete name.
Joining VSECU and/or opening a CD can be done online, or at any of nine Vermont branches, located in Bennington, Berlin, Brattleboro, Burlington, Montpelier, Rutland, Saint Johnsbury, Waterbury, and Williston.
A Share Savings account, with a minimum $25 deposit, is required to establish and maintain a VSECU membership. If the Share Savings account has a balance of less than $25 for a “period of one hundred (100) calendar days or more,” the membership will be automatically terminated.
VSECU participates in CO-OP Share Branch Network and ATM program, providing its members with access to more than 5,000 branch locations and nearly 3,000 ATMs.
Whether you’re going off to school, wintering in a warmer state, traveling across country, or moving, you can keep your membership at VSECU and continue to access your accounts.
Credit Union Overview
Vermont State Employees Credit Union has an overall health grade of "B+" at DepositAccounts.com, with a Texas Ratio of 9.17% (excellent), based on December 31, 2018 data. In the past year, VSECU increased its total non-brokered deposits by $28.35 million, an excellent annual growth rate of 4.55%. Please refer to our financial overview of Vermont State Employees Credit Union (NCUA Charter # 60717) for more details.
While Vermont State Employees Credit Union was officially chartered in 1947, VSECU's roots go back to 1946, when seven State of Vermont employees “organized a credit union to offer affordable savings and credit for themselves and their fellow state employees.” In 2002, the FOM was expanded to include residents of six Vermont counties, with the remaining eight counties added in 2009. VSECU is currently Vermont’s second largest credit union, with nearly 67,000 members and assets in excess of $778 million.
How the CD Compares
When compared to 217 similar length-of-term CDs tracked by DepositAccounts.com that require a similar minimum deposit and are available within the FOM, Vermont State Employees Credit Union’s 6-month CD APY currently ranks first.
The above rates are accurate as of 4/18/2019.
To look for the best CD rates, both nationwide and state specific, please refer to our CD Rates Table page.
https://www.depositaccounts.com/banks/vermont-state-employees-cu.html#rates
Thanks.
This question is not necessarily about this particular CU, but in general.
Let's say your CD matures and on the 7th Day of a 10-day grace period you either withdraw your funds or transfer them somewhere else. Is it common for interest to be paid for the six days that you had the funds there after the CD matured? Or did they stop paying interest during the grace period if you withdraw the funds?
And if they do pay interest, at what rate? The old CD rate? A savings account rate?
is there any consistency in this policy from one place to another, or is there a lot of variation?
So my money did not sit in the new CD for an entire day but my view is it would have paid the 1.40%. But, that is the only time I ever had one auto roll over like that. I ALWAYS ask that they set it to not do that and they almost always say fine. My guess is the 1.40% rate would still exceed their share rate so it would be better than going to the share account if I were to forget about it for 9 days. But so far I have never not remembered a maturing CD.
I would not be a happy camper if I was stuck with a 1.40% rate for an entire year. Particularly when I am sure I ALWAYS ask for the auto renew to be disabled.
I think the credit unions make themselves look bad by forcing such renewals as it can only lead to bad will.
If I were one day hospitalized for weeks and unable to call and stuck in a low rate CD I would raise cane over it and expect that any CU worth their salt would make things right.
Or at least allow me to break it early with no penalty.
The unfortunate part is that gambling is not supposed to be part of CD investing. One of the main points of CD investing is that you give up the prospect of earning a higher return for the certainty of a fixed return. But the terms of a CD are just as important as the rate as they can have a drastic effect on your actual return. And those terms can be difficult to manage, leading to unexpected uncertainty. It's something you always have to keep in mind with CD investing and factor into the equation.