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USAA Bank
APYMINMAXINSTITUTIONPRODUCTDETAILS
1.11%$95k$175kUSAA Bank7 Year CD - Jumbo
1.11%$175k-USAA Bank7 Year CD - Super Jumbo
1.06%$1k$95kUSAA Bank7 Year CD - Standard
Accounts mentioned in this post. Rates as of May 3, 2016.

USAA Bank Increases 7-Year CD Rates - Best 7-Year CD Rates in the Nation

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You can now get very close to a 4.00% CD at USAA Bank. It recently increased the rate of its 7-year CDs, and the Super Jumbo now has a 3.96% APY. This requires a $175K deposit. Below is the full list of rates for the different minimum deposits:

APYs of USAA Bank's 7-year CD and IRA CD as of 8/06/2010

  • 3.96% min $175,000
  • 3.70% min $95,000
  • 3.60% min $1,000

Note, after 7-years with a 3.96% APY, $175K will grow to $229.7K which is under the standard FDIC deposit insurance limit. That's one of the very few advantages of a low interest rate.

For more info on USAA Bank and these CDs, please refer to this recent blog post. Note, the early withdrawal penalty of the 7-year CD is 365 days interest on the amount withdrawn. Also note that the USAA Bank's disclosure states that "Any withdrawals before the maturity date require Bank’s consent." I looked into the possibility of a bank refusing an early withdrawal in this post.

PenFed's 7-year CD rate is close to these rates. I reviewed PenFed's long-term CDs and looked at the effect of the early withdrawal penalties in this post. As I described in the PenFed post, you might do better in a long-term CD that's closed early compared to a short-term CD. The best example of this is Ally Bank's 5-year CD which only has a 60-day early withdrawal penalty (see my Ally Bank CD review).

Thanks to the reader who emailed me news of this rate change.


Related Pages: USAA Bank, San Antonio, CD rates

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Comments


LIGHTRIDER
LIGHTRIDER (anonymous)   |     |   Comment #5
TO MUCH $$$ FOR TOO LITLE RETURN. KEEP IT!
Dan B
Dan B (anonymous)   |     |   Comment #6
I understand the sentiment but frankly 4% is either an acceptaable return or isn't an acceptable return...........regardless of whether one thinks 175k is a lot of money or not.
Anonymous
Anonymous   |     |   Comment #8
Come on mr. 5% bonds genius come and save us all we are so patiently waiting
Bozo
Bozo (anonymous)   |     |   Comment #9
If you are retired and are using the standard 4% SWR, then any return reasonably close to 4% means you can minimize capital withdrawals. The 4% SWR usually assumes you increase your withdrawal each year by the amount of inflation. With inflation at or near zero, what the 7-year throws off permits a deferral of capital reduction until inflation recurs. Then, you can nibble at other investments. I think these long-term USAA super-jumbos are excellent vehicles for a CD ladder. Obviously, you should be diversified, and well-laddered in your CDs and bonds, but I find this product to be a nice, secure anchor.

 

Just my $.02.

 

Bozo