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Top CD Rates Continue at Connexus Credit Union - Easy Membership
When I last reviewed Connexus Credit Union's CDs in August, these CD rates were competitive, but there were several other credit unions and banks offering similar rates. Connexus Credit Union has held these CD rates the same since that time while everyone else have made cuts. So these rates are now especially competitive. However, there is one major downside. They require that you have an active checking account.
Here are the three competitive CD rates as listed at Connexus deposit rates page as of 2/1/2011:
- 3.00% APY 5-year CD
- 1.75% APY 1-year CD
- 1.50% APY 6-month CD
Minimum deposit is $500 with no maximum deposit. Here's how they define active checking in the small print:
Active Checking is defined as having at least 1 Direct Deposit of net pay, including salary, wages, government benefits or pension made to the account each month; having 10 checks and/or signature debit card transactions clear the account by the last business day of each month; and electing to receive eStatements.
They don't have many account details at this deposit rates page, but they do have an online chat service. So I used that service this morning to get more details. I asked the CSR what would happen to the CD if the member missed the requirements for the month. Would the CD rate go down for the month like it would for the checking? Here's the reply:
Member_Service:
no you would still earn the higher % in the cd
Member_Service:
but we really want you to be using us as your primary financial that is why we have set the rates up that way
So unlike the reward checking account, they wouldn't punish you for missing the monthly requirements. However, using the checking as your primary account is viewed as important to the institution in allowing them to offer the high rates. In a way these CDs are another version of a reward checking account. The advantage is that your rate is locked for the term. The downside is that the money isn't as liquid.
On the bottom of the deposit rates page, they do have a link to the account disclosure which has several CD details. Unfortunately, the 5-year CD has a harsh early withdrawal penalty: "365 days dividends on the amount withdrawn." Also, withdrawals of principal can only be done if Connexus "agrees at the time you request the withdrawal."
Connexus also offers two reward checking accounts: Xtraordinary Checking and MyRewards Checking. Meeting these monthly requirements should also give you the active checking status for the CDs. Unfortunately, the rates on these reward checking accounts have fallen quite a bit since I first reported on them in 2008.
Other Accounts
Connexus Credit Union also has good deals on a money market account and an HSA. Please refer to my money market review for more info on these accounts.
Membership
Membership is open to members of the Connexus Association. According to this Connexus page:
Anyone in the United States may join the Connexus Association, and the only requirement to join is that you make a one-time $5 donation to the Association that will directly benefit one of many supported organizations. Then, once you're a member of the Association, you will be eligible to join Connexus Credit Union and experience all the benefits of Connexus membership.
There's also a $5 minimum balance required for the savings account to maintain credit union membership.
Credit Union Overview
The credit union is headquartered in Wausau, Wisconsin. Branches are located in Wisconsin, Ohio and New Hampshire. It appears Connexus started out as an employee-based credit union for Liberty Mutual Insurance. Most of their branches are in Liberty Mutual offices.
Connexus Credit Union has an overall health score at DepositAccounts.com of 4 out of 5 with a Texas Ratio of 15.63% (excellent) based on September 2010. Please refer to our financial overview of Connexus Credit Union for more details. The credit union is federally insured by the NCUA (Charter # 66538).
Both CSRs I have spoken with today insist that ACH deposits do not count but have offered to confirm their understanding with their supervisor. They did suggest, however, that someone who can't meet the requirements would be welcome to open the 5 year CD at 2.25% instead.