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A Study In Fine Print

Bozo
  |     |   1,375 posts since 2011

Well, readers of DA have long assumed PenFed allows partial withdrawals from IRA CDs for those over 59 1/2. Or is this just an urban myth? I remember reading the terms and conditions years ago, but, dang, was this perquisite still available? Off on the hunt for fine print.

After logging onto my PenFed account, it was free-association. I finally stumbled upon a document entitled "IRA Account Disclosure/New Accounts". Although I wasn't exactly a new account, I gave it a shot. Mind-numbing fine print, page after page. Finally, I got to page 15. There it was, the magic language.. Article XIII.4.(g)(3)(iv). Only a retired lawyer could appreciate.

Yes, indeedy, folks, PenFed still waives the EWP on IRA CDs for folks over the age of 59 1/2 for partial withdrawals. It says so right in the fine print. Bring a bit of patience, and the zoom feature, as the font is a bit small.

Mind you, this perquisite is not exactly something you might stumble upon. Were I to hazard a guess, I might suppose the number of folks who know about it are few. The number of folks who avail themselves of it, somewhat less. PenFed doesn't exactly promote the perk.

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Ally6770
  |     |   4,307 posts since 2010
I think most or all credit union allow penalty free withdrawals for RMD's or if you are 59 1/2. Pen Fed has allowed this since the 90's when we first joined and probably earlier. My husband and I have never been charged from taking withdrawals from any long term CD's anywhere. We always open a CD at the highest rate no matter how long out and took our RMD from the lowest rate on the 20th of DEC. This gave time to make sure it was done properly before the end of the year and it also left the money in longer to maximize interest. Actually Pen Fed CSR are very well informed and will find out the answer for you if they do not know the answer when you call. So are Navy, USA, Lake Michigan, Flagstar, Inova, Apple, and a few other CSR's well informed. Actually at Pen Fed you can take the CD down to $1,000 and not pay a penalty. Always leave at least $1,000 in the CD. If you want to close the CD at Pen Fed do it after it has been drawn down to $1,000 and the penalty will be lower. This was a hint from the CSR at Pen Fed. Navy does not charge to close. I have only closed the ones at Navy doing conversions. At one time Advia (then First Community) tried to charge and I do believe it still is a law or was at that time that if you are taking your RMD there can be NO penalty and I have a letter from them now stating they will never charge for a RMD withdrawal on a long term CD.
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