As I reported in late January, PenFed took the unusual step to have two CD rate schedules for February. One of the rate schedules is for new CDs, and most of the rates are much lower than the January rates. This rate schedule is posted on PenFed’s website. The other rate schedule is for PenFed CDs that are maturing in February and are being renewed. This rate schedule isn’t publicly disclosed. Hopefully, PenFed is informing customers who have CDs maturing in February. Since this info isn’t listed on PenFed’s website, a few readers asked if I could find out more details. So I called PenFed yesterday and received the details.
First, the February rates for renewed CDs are in fact the same as the posted January rates (except for the 1-year CD rate which is higher in February). Below is a listing of those rates:
PenFed rates only for CDs being renewed in February:
- 3.04% APY 7-year CD
- 3.04% APY 5-year CD
- 2.22% APY 4-year CD
- 2.02% APY 3-year CD
- 1.41% APY 2-year CD
- 1.16% APY 1-year CD
- 0.30% APY 6-month CD
These rates apply to both regular and IRA CDs that are being renewed in February.
Unfortunately, there are limitations. There can be no change in the maturing CD balance. No money can be added and no money can be withdrawn for the renewed CD. However, you can change the term of the CD. For example, if you had a 3-year CD that’s maturing in February, you can change the term to 5 or 7 years and still get the 3% rate.
One reader left the following comment about his/her PenFed CD that matured on February 3rd:
I also had a certificate which matured on Feb 3, I changed the term to 7 yr and it renewed at 3.04 APY. I didn't have to call, either
When I’ve opened PenFed CDs in the past, I typically choose the option to have the maturing CD automatically deposited into my PenFed savings account. I always thought that would be the best option in case I forget about the maturity date. However, this is an example when it’s not the best option. If you have PenFed CDs that are maturing in February, and you want to renew them with the January rates, make sure you change this option to renew instead of "transfer to savings". According to the CSR, this is all you have to do to ensure you get the January rates. Based on the comment, this does in fact seem to be the case. Nevertheless, it wouldn’t hurt to check with the CSR before the maturity date.
For information about PenFed, its CDs and how to join the credit union, please refer to my PenFed post on February CD rates.