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2.17%$1k-PenFed Credit Union7 Year Money Market Certificate
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Accounts mentioned in this post. Rates as of August 19, 2017.

PenFed Slashes CD Rates for March


All good things must come to an end. That’s the case with PenFed CD rates. PenFed slashed its CD rates for March. The sizes of the cuts range from 51 basis points for the 7-year CD to 25 basis points for the 2- and 3-year CDs. For those who had PenFed CDs maturing in March, I’m afraid the special renewal rates were not extended into March.

Below is a summary of the new March 2014 CD APYs and the old February APYs:

  • 1.76% 7-year CD (was 2.27%)
  • 1.76% 5-year CD (was 2.02%)
  • 1.51% 4-year CD (was 1.76%)
  • 1.26% 3-year CD (was 1.51%)
  • 0.90% 2-year CD (was 1.26%)
  • 0.80% 1-year CD (was 1.16%)

If you’re looking for CDs, there are much better deals at other institutions. The best deal for long-term CDs and IRA CDs continues to be at Navy Federal Credit Union. The two best deals are the Jumbo 7-year CD with a 3.10% APY and the Jumbo 5-year CD with a 2.55% APY. The main downside with Navy Federal is that it has membership limitations. I have more details in this blog post.

If you can’t qualify for Navy Federal membership, you may want to consider an internet bank like Barclays which has a 5-year CD with a 2.15% APY. There is no minimum deposit requirement, and the early withdrawal penalty is only 180 days of interest. You can get a slightly higher rate at CIT Bank with at least a $100K deposit, but the early withdrawal penalty is 12 months of interest for the 5-year Jumbo CD.

The above rates are accurate as of 3/1/2014.

Related Pages: CD rates, IRA rates

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scottj   |     |   Comment #1
Seems to be their pattern, every couple years offer the best rates available for a short time and then drop back to sub par rates. I'm just glad I have been able to take advantage of the 3.04% 5 year and 5% 10 year. Looks like my timing of tying up matured CDs has worked pretty well and I don't have another CD maturing till 12/31/14, don't think we will see much till at least then
Anonymous   |     |   Comment #2
What they did is called nothing more than a "promotion".
HoHo   |     |   Comment #3
They probably raised all the cash they wanted.   I too took advantage of the 10 year 5% and the recent 5 year 3.04.  I have CD's maturing in 2015 so I have to see how things look then
Anonymous   |     |   Comment #4
When did Penfed have a 5% rate?
scottj   |     |   Comment #6
Jan 2011 had the 10 year 5%, so now into it for over 3  years and looking good
Anonymous   |     |   Comment #9
I still have CD's at Pen Fed earning both 5% and 6%.
lou   |     |   Comment #15
It is impossible for you to have a 6% CD from Penfed. They have all matured.
Anonymous   |     |   Comment #21
Yep, I believe the last 6% would have matured in Jan of this year.
Anonymous   |     |   Comment #26
I too have a small 6% one left from penfed, expires in October.
Henirque   |     |   Comment #29
You are mistaken (as usual).  My mother-in-law has a 10-year PenFed (they offered them in 2005) at 6.02%, still active.
Anonymous   |     |   Comment #10
#9  How long ago did you get those rates?  An what is the term?
HoHo   |     |   Comment #12
January 2011.  Many here believe it was a mistake by Penfed but they did honor the rate.  I was skeptical at the time to lock up Money for 10 years but the way rates are now looks like I made a good choice. 
Shorebreak   |     |   Comment #5
I expect Navy Federal Credit Union will slash it's certificate rates when they accumulate enough deposits to fully fund their expanding lending programs. Thus I'm taking advantage of their current top-tier rates to lock-in some decent returns while still being offered.

"Looking to build on momentum from 2013, Navy Federal Credit Union is poised to grow both its auto and business lending programs even more this year.

Hoody   |     |   Comment #7
I'm wondering what Navy's rates will show Monday, the rep I talked with said he wasn't sure but the rates have held for a couple months now. I said yeah but look at PF.

So I decided to make a move now, even though they might stay the same, I have no crystal ball to ask for advice. I didn't want to wake up monday and find the same thing at Navy, and I got tired of going from 1%er to another 1%er, if lucky. BB&T tried to convince me to open another .75 "special" no penalty for 30mo, I said I could pay the EWP at navy and still be better off in 3 yrs. So I closed out a no penalty at BB&T Thursday that still had a month to go, at 1%, this was a 30mo CD. I opened 2 at Navy the same day for the 7yr thing, one gets the 3.1 (3.05 rate) while the smaller one is getting the 3.05 (3.00 rate), I did that just in case I ever have a need for some of it in that time.

Its enough to keep me going and not have to bust into any principal, and sleep somewhat  better, even though I don't believe we'd ever see our money back in our lifetime if the FDIC had to bail everybody out.
Anonymous   |     |   Comment #8
#7.  Good move.  I did not  wait and see what happens to Navy rates on Monday either.
Hoody   |     |   Comment #11
Thanks for the encouragement,

I hope we did the right thing, but with rates like these there's nothing better anywhere else for now, even at these long a periods

But than even if rates move to 3% on lower periods we will still be making the same anyway.
paoli2   |     |   Comment #13
I have been checking my rates all morning and was surprised to see that most are going "down" not up.  I think you both were very astute to grab what you could get today and not be concerned about what could have been.
51hh   |     |   Comment #14
How do you put funds in for NFCU CD quickly?  Their external ACH seems to work only for credit card payment.
CSR suggests wiring (which I do not like) or via external link (say from Ally; which takes 2-3 days).  What is the quickest way to buy NFCU CD?  TIA.
paoli2   |     |   Comment #16
51hh:  I got our latest CD from NFCU recently over the phone by just giving them one of our checking account check numbers and the routing number and checking account number.  Within 2 days they had withdrawn the amount out of our local checking account and I could see it online.  Once I saw they had taken the money, I called them and the rep gave me the CD number over the phone and that day it was all online and they back-dated the CD to the day I had called 2 days earlier.  They said their rates change on Mondays so if we call in the week before the way I did, they will give us the rate for that day of the call while waiting to withdraw the funds from our account.  I was glad they did this because now I see the rates did go down this past Monday and I was able to get the higher rate.  It was done very fast and professional and is now complete.  I like this much better than wiring and there is no charge doing it this way.  I never had to send them the check for the number I gave them.  I just voided it and put in my file for my records.
Anonymous   |     |   Comment #22
Of course Penfed's rates went down.  The millions they spent on additional CSRs to service paoli nonstop 24/7 adds up.
Anonymous   |     |   Comment #34
They may learn from this.  Maybe just offer these rates to new members.  Give a separate rate for renewed CD's.  They don't need the headaches.  They can grow the base without people closing CD's and opening higher rate CD's.
Shorebreak   |     |   Comment #27
Since my Ally Bank Money Market Account was already listed as an 'external account' with Navy Federal CU, I was able to fund a new 5-year certificate with an ACH transfer from Ally and was given a reference number for the transfer. The certificate date of issue will be today's date. The funds will go from Ally into my Navy Federal CU savings account then transferred into the new certificate. All this was done smoothly over the phone and should be completed in a couple of days.
51hh   |     |   Comment #17
Just talked to a NFCU CSR, informing me that (1) the rate of 7-year CD will be dropping to about 2.75% next Monday, (2) I can call them and give the bank information for CD purchases.

Thus for those who want the high rate CD, purchase that either today or tomorrow.
Shorebreak   |     |   Comment #18
I expected that to occur. That's why I opened 7 certificates with Navy Federal CU in the past two weeks.
lou   |     |   Comment #19
One of the reasons I went long on CDs the last five years is because of all the posters who came to this site and stayed short because they were sure rates were going up.

Now, there seems to be a stampede to purchase 5 to 7-year CDs by readers of this site. I wonder if this portends a change of tactics. As a contrarian, I might have to reassess my strategy of staying long. 
Anonymous   |     |   Comment #24
You were prescient. I think we're seeing capitulation and the advent of the "new normal" CD interest rate. People are exhausted worrying about employment, savings, investments, health care costs, and retirement planning. Also, remember, the vast majority of "savers" (with trillions of dollars) are stuck in local banks/CU's earning paltry returns. PenFed and NFCU don't show up on their radars.

Personally, I agonized over 7%, then 5%, then 4% and finally 3% CD's. A few years ago we parked some cash at 1.75% for a year...it was a week long special rate no local bank could touch. I could accept the 7%, after a few years the 5% made me feel like a genius and now 3% looks like a safe bet. Then again, we're not trying to pay bills with the interest. Anyone in that situation may be in serious trouble.   
Shorebreak   |     |   Comment #28
I did exactly that. Thanks 51hh for the heads-up on the 'probable' pending rate-cut at Navy Federal CU.
PabloSavin   |     |   Comment #20
Well Navy Federal cuts CD rates also. Went in yesterday to get a CD. They are dropping on Monday. Guess the economy is not rolling along as expected! Where to buy next. I have over 250K coming due this month.
Hoody   |     |   Comment #25
yeah, when I seen PF drop I had a feeling Navy was gona follow up as well, its why I decided last Thursday to just close the no penlaty 30mo cd at BB&T that had one more month on it and drop it into Navy.

Did they say what the rates were gona be when you were there? the rep I talked to just said he wasn't sure.

Its gona be another bad ride for a while for those that have those 4-6%rs comin due from 5 or 10 yrs ago. That's the way mine were set up at the time, they all came due right at the height of the drop and wasn't much I could do but take those 1%ers, hell I even had to go with a .80 2yr one at Suntrust one time.

I was glad to see Navy open a small branch here a couple years ago. I also had my reservations about going out that long, but looking at the way things are going in the world today, it doesn't look all that great, at least for those that have always been savers due to necessity.

I hope for others it does get better, even the younger savers need help to get started.
Anonymous   |     |   Comment #23
Ken, So glad I got in on the 3% CD (I hope)  thanks to you!
Anonymous   |     |   Comment #30
Laughable!!! I am all into muni bonds now at 5% and pay a 5% premium to purchase thme and have taken them for 20-30 yrs....tax free!! AA rated GOs and water revenue bonds! No banks!
Moo Moo
Moo Moo   |     |   Comment #31
I also like some munis (GO's, somes revs) especially since I live in California. there's actually a new CA GO offering in a couple weeks that I'll check out. other than that, nothing looks too interesting. CTI 3.4% 10 year CD's(Brokered) seem like a fair deal and they have been selling at a pretty good pace.  The reality is it's an efficient market out there, and risk is generally directly proportional to reward. If you look hard enough, you can find some value and scrape a few extra basis points here and there. Good luck everyone!
HoHo   |     |   Comment #33
I have muni's and some are paying  5.75% (Not callable till 2018) till 2023.   The only thing has been that my 5% bonds are being called but what happens when interest rates go down..   I did buy some at 3.75% about a year ago. I live in NY.  I have a very diversified portfolio including CD's, stocks, bonds, MLP's , REITS.   I also refinanced my mortgage to a 3.5% rate a couple years back.  That's one good thing that QE gave me but I guess I'm paying for that with low CD rates.
Anonymous   |     |   Comment #35
I live in CA too, when do these new GOs come out? Do you get them from your rboker or on your own and is there anything new about them?
Or is it that they have call protection now til 2024 or 2025 unlike the current ones? Thx
Anonymous   |     |   Comment #36
Check the CA muni web site for initial info:  http://www.buycaliforniabonds.com/index.asp

You'll see a GO offering planned for around 3-13.

For each new offering, you need to see which brokers are participating.  Fidelity participates in a lot of the bigger ones.  For CA GO's, the issues that are under 10 years are usually call protected, and after 10 years they are not.  At least this has been the trend over the past couple years.
Anonymous   |     |   Comment #32
Penfed always gives out good rates in the very beginning of the year.
Anonymous   |     |   Comment #37
For the last four years and a few months, the highest rate Penfed has paid on a 7 year cd was 4.00% and that was on Nov. 19, 2009.  From this date on, rates have never reached 4.00% again.