PenFed CD rates on 12 month certificates are currently at 2.67 percent with an annual percentage yield of 2.71 percent. This 12 month CD rate is one of the best CD rates available right now. 6 month CD rates at PenFed are also very good right now, the current CD rate is 2.29 percent with an APY of 2.30 percent. The rate of 2.50% is 0.79% higher than the average 1.71%. Also it is 0.55% lower than the highest rate 3.05 Updated Aug, 2019 on PenFed Federal Credit Union's secure website. Penfed has great rates for you - whether you're looking for a new auto loan, personal loan or a great credit card./ We use cookies to provide you with better experiences and allow you to navigate our website.
© damircudic/Getty Images Mother working from homePenfed Cd Prices
Penfed has great rates for you - whether you're looking for a new auto loan, personal loan or a great credit card. Penfed has great rates for you - whether you're looking for a new auto loan, personal loan or a. May 06, 2020 PenFed Credit Union (PenFed) used to offer very competitive CD rates. My last post was in early 2019 when its 5-year CD yield was over 3%. Unfortunately, PenFed’s CD rates have been uncompetitive for some time, with rates much lower than what online banks are offering.
Pentagon Federal Credit Union is the second-largest federal credit union in the U.S. Unlike some other exclusive institutions, membership is open to anyone. While U.S. government employees, members of the U.S. military and Uniformed Services and their families qualify automatically, you can also gain membership by joining one of two organizations (for a one-time cost of $14 to $15).
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PenFed offers a wide range of products from checking and savings accounts to personal loans and mortgages. Its rates and terms tend to be competitive in the market, while its branch access is limited. Bankrate’s overall rating of the Pentagon Federal Credit Union is 4.3 out of 5.
Pentagon Federal Credit Union CD rates
Pentagon Federal Credit Union offers money market certificates, IRA certificates and Coverdell Education Savings certificates. According to PenFed’s website, banks use the term “certificate of deposit,” or CD, while credit unions use the term “certificate.” However, the accounts function in the same way.
Here are the rates on PenFed’s money market certificates.
| Account | Term | APY | Minimum balance |
| Money market certificate | 6 months | 0.30% | $1,000 |
| Money market certificate | 12 months | 0.50% | $1,000 |
| Money market certificate | 15 months | 0.50% | $1,000 |
| Money market certificate | 18 months | 0.50% | $1,000 |
| Money market certificate | 2 years | 0.55% | $1,000 |
| Money market certificate | 3 years | 0.60% | $1,000 |
| Money market certificate | 4 years | 0.65% | $1,000 |
| Money market certificate | 5 years | 0.75% | $1,000 |
| Money market certificate | 7 years | 0.80% | $1,000 |
Note: The APY (annual percentage yield) shown is as of Jan. 5, 2021. The APY may vary in region.
Minimum deposits range from $500 to $1,000, depending on the certificate type and all certificates are backed by NCUA insurance up to $250,000. Additionally, all certificate dividends are compounded daily except for six-month money market certificates which earn dividends on a simple interest basis.
You’ll face penalties for withdrawing your Coverdell or money market certificates early while qualified distributions and partial withdrawals after the age of 59 1/2 are allowed on IRA certificates without penalties.
How Pentagon Federal Credit Union compares to top-yielding banks
When comparing the best CD interest rates, PenFed CD rates tend to fall in the middle of the pack. Its one-year money market certificate APY currently sits at 0.50 percent while top competitors earn up to 0.80 percent. The three-year APY is 0.60 percent while top competitors range from 0.81 percent to 1.15 percent, and the five-year APY is at 0.80 percent compared to top competitors coming in from 1.00 percent to 1.35 percent.
Where PenFed CDs stand out is in other CD terms like the minimum deposit amount. Across the board, PenFed only requires $1,000 to open a money market certificate. Competitors such as Amerant Bank and PurePoint Financial ask $10,000, Citizens Access requires $5,000 and Synchrony Bank requires $2,000. However, there are a few competitors with no minimum deposit amount including Capital One, Ally Bank and Barclays.
Other savings options at Pentagon Federal Credit Union
Pentagon Federal Credit Union ranks well when it comes to savings accounts due to its Premium Online Savings offering. You only need $5 to open the account, there is no monthly fee and the APY is competitive.
Additionally, FedPen offers a regular savings account; however, the APY is only a modest 0.05 percent. A money market savings account is also on offer with a 0.15 percent APY on balances over $100,000.
The Premium Online Savings account comes out a clear winner in PenFed’s lineup due to the low barrier of entry and high reward. Depending on how long you want to keep your money in a CD and how much you have to invest, the savings account may even be a better alternative to CDs.
- High-earning interest rate
- Two account options, including an education savings account
- Potentially high minimum deposit
- Customers who qualify for membership and want a big boost of savings
Historically, credit unions offer better interest rates than traditional banks. This remains true with PenFed Credit Union which offers some of the best certificate of deposit rates around. These rates compete well with its bank competitors.
Luckily you’ll have a variety of terms to choose from. Money Market Certificates come as nine different term lengths, from six months to seven years long. Coverdell Education Savings Certificates offer six different terms from one to seven years. These options allow you to find the accounts that work best for your financial situation and savings goals.
PenFed Money Market Certificates
The PenFed Money Market Certificates work as the credit union’s standard CDs. You have a number of term options to choose from, each with a high interest rate. This means you can see immense growth in your savings no matter which term you choose.
PenFed calculates dividends daily and pays them monthly. Whichever you choose, it can be paid by adding it back into the certificate, transferred to another account or sent in check form.
| Money Market Certificates | Minimum Deposit | APY |
| 6 Month | $1,000 | 0.25% |
| 12 Month | $1,000 | 0.45% |
| 15 Month | $1,000 | 0.45% |
| 18 Month | $1,000 | 0.45% |
| 2 Year | $1,000 | 0.50% |
| 3 Year | $1,000 | 0.55% |
| 4 Year | $1,000 | 0.60% |
| 5 Year | $1,000 | 0.70% |
| 7 Year | $1,000 | 0.75% |
PenFed Coverdell Education Savings Certificates
Coverdell Education Savings Certificates are meant to help you save for education expenses. This includes elementary, secondary and college costs like books and tuition. With a minimum deposit of $500, it’s easier to get started with these certificates than with a Money Market Certificate. There is also a $2,000 maximum yearly contribution to Coverdell Education Savings Certificates.
A big plus of these accounts is that they generate tax-free earnings. This allows you to really spend all your earnings on future education costs.
| Coverdell Education Savings Certificates | Minimum Deposit | APY |
| 1 Year | $500 | 0.40% |
| 2 Year | $500 | 0.45% |
| 3 Year | $500 | 0.50% |
| 4 Year | $500 | 0.55% |
| 5 Year | $500 | 0.65% |
| 7 Year | $500 | 0.70% |
6-Month Money Market Certificate Interest Rate Comparison
Penfed Cd Rates 2018
Overview of PenFed CDs
PenFed is a credit union, which means you need to be a member of the credit union in order to open an account. You can join PenFed based on your employment, volunteerism or military affiliation. You may also be able to join if you know someone who is already a PenFed member. If you qualify, then you can become a PenFed member and start earning at its high rates.
While PenFed does offer two certificate of deposit account types, you may only use a Coverdell Education Savings Certificate to pay for education expenses. Still, you can open multiple Money Market Certificates if big savings is what you’re looking for. To really maximize your savings, open a few accounts at the same time, each with a different maturity date. That way, you can have a certificate payout in six months, 12 months, two years and four years from now, for example. This practice is called a CD ladder. It helps you set up a steady stream of income over the months. Just be careful of overstretching your current funds so you don’t end up with all your money tied up in a certificate and none in your actual checking account.
Once you make your deposit into your certificate account, you won’t be able to make any withdrawals or additional deposits until it reaches maturity. If you really need to access those funds, you can make an early withdrawal although at a cost. To make an early withdrawal from a Money Market Certificate, you’ll need to first make a request in writing. Certificates funded by ACH do not allow for withdrawals within the first 60 days of account opening. For six-month accounts, you’ll have to forfeit all your earnings if the withdrawal is made within 90 days of account opening. After those 90 days, your penalty equals 90 days of interest earned. If you make an early withdrawal within the first year on an account longer than six months, you’ll have to forfeit all the dividends you earned. Any withdrawals after one year assess a penalty of 30% of what would have been earned had you held the certificate to maturity.
Coverdell Education Savings Certificates assess a slightly different early withdrawal penalty. You still must provide your early withdrawal request in writing. If you withdraw within the first year of account opening, you’ll have to forfeit all the dividends you earned. If you make a withdrawal after that first year, the penalty equals 30% of the interest your account would have earned had it been held to maturity.
Your PenFed certificates are NCUA-insured up to legal limits instead of being insured by the FDIC.
Compare PenFed to Other Competitive Offers
How Much You Earn With PenFed Certificate of Deposits Over Time
With just about the highest rates around, PenFed guarantees a big boost in your savings no matter which account you open. If you’re not saving toward education, you’ll open a Money Market Certificate, which means you have to deposit at least $1,000. This does limit potential customers who don’t have at least $1,000 to set aside responsibly. However, higher deposits result in higher final balances since there is more to grow.
To snag the highest PenFed certificate rates, you’ll want to open longer-term accounts. This can earn you hundreds, or even thousands, in savings. However, it also means that you have to wait for the long-term account to mature, which can reach as high as seven years.
Plus, PenFed compounds interest daily. This means your interest grows faster and more efficiently by building on itself every day. So your deposit will earn interest today, all that money will earn interest again tomorrow and so on. This is the fastest way to grow your deposit as opposed to compounding weekly or even monthly.
How PenFed CDs Rates Compare to Other Banks
Another credit union with excellent rates is Navy Federal Credit Union (NFCU), which offers a variety of certificates and rates. The minimum you need to deposit is also $1,000. However, larger deposits (think $100,000) can earn at higher interest rates. The rates we’ve given below correlate to the $1,000 minimum tier. Its rates compete well with PenFed’s, even reaching so high as a 1.01% APY on a 5-year account. Do note that NFCU has its own membership requirements that are more limited to military members and their families.
A close interest rate competitor, although not a credit union, is Marcus by Goldman Sachs. Marcus is an online bank which allows it to offer such high rates. You do need at least $500 to open a Marcus CD, which does open up the account to more customers than a $1,000 minimum.
| CD Account | PenFed (Money Market Certificates) | Navy Federal Credit Union | Marcus by Goldman Sachs | Chase |
| 6 Month | 0.25% | 0.45% | 0.15% | 0.02% |
| 1 Year | 0.45% | 0.55% | 0.55% | 0.02% |
| 3 Year | 0.55% | 0.70% | 0.55% | 0.02% |
| 5 Year | 0.70% | 0.90% | 0.60% | 0.02% |
Should You Get a PenFed CD Account?
Penfed Cd Rates 2019
If you qualify for PenFed membership, you should consider opening a certificate account. These accounts have some of the best rates around, even when compared to online banks. You’ll want to take advantage of your membership by using these great rates to really boost your savings. Plus, if you foresee education expenses in your future, the Coverdell Savings Certificates allow you to save toward those costs tax-free.