The credit union NEFCU just increased the rate of its 20-month bump certificate which makes this a good CD deal. This 20-month CD now has a 1.25% APY. Minimum deposit is $1,000 or $500 for the IRA. New money is required. It has a one-time bump feature which allows you to increase your rate once during the term. This rate is listed in the credit union’s 20-month bump certificates page as of 10/25/2013.
In theory the bump-up feature allows you to take advantage of rising interest rates without breaking the CD and paying the early withdrawal penalty. In the case of this 20-month CD, the new bumped up rate would be the 2-year CD rate. NEFCU’s current 2-year CD rate is only 0.90%. This shows the potential problem with bump-up CDs. It depends on the financial institution maintaining competitive rates on its CDs.
High-Interest Reward Checking Account
NEFCU has long offered a good deal on a high-yield reward checking account. It’s called the GO Green Checking. It’s a free reward checking account that pays 2.53% APY on balances up to $25,000 as of 10/25/2013. Like all reward checking accounts, monthly requirements must be met to qualify for the high interest rate. This reward checking account is a little unique in that it not only requires 12 debit card purchases per month, but it also requires that purchases be at least $5. I first reviewed this account in 2008 when it was paying 4.00% APY. The rate has fallen less than many other reward checking accounts.
NEFCU membership is open to all those who live, work, worship or attend school in Nassau or Suffolk County, New York. Please refer to NEFCU's Membership page for the full details. Membership requires a minimum deposit of $5 in the share savings account. An online application is provided.
Credit Union Overview
NEFCU branches are located in the New York towns of Valley Stream, Rockville Centre, Westbury, Syosset, Massapequa, Franklin Square, New Hyde Park, Plainview, Brookville, Commack and Wantagh
The credit union has an overall health grade at DepositAccounts.com of a B+ with a Texas ratio of 9.07% (above average) based on June 2013 data. Please refer to our financial overview of NEFCU for more details. The credit union is federally insured by the NCUA (Charter # 2760).
Other Bump-Up CDs
Two internet banks currently offer bump-up CDs: Ally Bank and CIT Bank. Ally Bank calls its bump-up CDs Raise Your Rate CDs. In my review of Ally’s Raise Your Rate CDs, I showed how this can be a good deal, but it probably won’t be that much better than Ally’s 5-year CD. CIT Bank’s 1-year and 2-year Achiever CDs have a bump-up feature and an add-on feature. These Achiever CDs don’t have the best rates, but they’re very competitive. I have more details in my CIT Bank Achiever CD review.
To search for nationwide CD rates and CD rates in your state, please refer to the best CD rates section of DepositAccounts.com.