PenFED Credit Union
Fees
Minimum Deposit
Our Rating
APY Savings
PenFED, or Pentagon Federal credit union, has been around since 1935. It was initially established as a credit union for military personnel, civilian government employees, and their families. Initially, membership was strictly limited to these groups, but today, PenFED has an open national membership charter.
PenFED offers various banking services, including savings and checking accounts, CDs, credit cards, and lending products. The credit union has established a solid reputation for providing competitive rates and being easy to join credit union.
PenFED even has a mobile app to help its members manage their accounts. However, there are some negative comments about PenFED, which relate to hefty fees. This includes an insufficient funds fee, which is a steep $30 and can be charged multiple times in just one day.
PenFED is available throughout all 50 states and other territories, including the District of Columbia, Puerto Rico, Okinawa, and Guam. PenFED has over 2.5 million members with $31 billion+ in assets.
- Competitive Rates
- Open Membership
- Low Minimum Deposits
- Large ATM Network
- You Need a Savings Account
- Limited Branches
- Stiff Early Withdrawal Penalties
What is required to open a PenFED account?
You’ll need to provide your personal details along with proof of your ID, such as a valid driver’s license, passport or state issued photo ID.
Is PenFED worth it for Joint Accounts?
If you’re looking for a joint account with minimal fees or the ability to earn interest on your checking account balance, PenFED is a good option for a joint account.
Is PenFED worth it if I have bad credit?
You’ll need good to excellent credit to qualify for PenFED credit cards or loan products. However, by opening a savings and checking account, you can establish a banking relationship with PenFED, which may improve your approval chances.
Does PenFED offer a free checking account?
Yes, the free checking account has no monthly fees and offers several other benefits including free bill pay.
Table Of Content
Banking Services | Credit Options | ||
|---|---|---|---|
Savings Accounts | Mortgage | ||
Checking Accounts | Government Mortgage | ||
CDs | Credit Cards | ||
Money Market Account | Debit Card | ||
Investing Capabilities | Personal Loans |
PenFED Savings
APY Savings
Minimum Deposit
Promotion
Fees
PenFED Savings
APY Savings
Minimum Deposit
Promotion
Fees
PenFED has two types of savings accounts; Regular and Premium. You’ll need a $5 initial deposit to open either of these accounts and become a PenFED member. The key features of these accounts include the following:
- Competitive Rates: While the Regular Savings account has a modest APY, the Premium Online Savings account has an impressive rate, currently 2.90% APY. Additionally, your interest is compounded monthly and credited to your account each month to help build your savings even faster.
- No Minimum Balance: Although you need to open the account with $5, there is no minimum balance on either account to earn the APY.
- Minimal Fees: No maintenance or monthly fees are associated with these accounts, so you don’t need to worry about covering a hefty monthly maintenance fee to keep your account in good standing.
- Bill Pay: You can use either account to pay bills via the free Bill Pay service offered by PenFED.
- ATM Access: The Regular savings account provides an ATM card that can be used for balance inquiries or to withdraw cash. Unfortunately, this is not a free service, as you will need to pay a fee for both services at in-network and non network ATMs. Premium Online Savings does not have an ATM card, so you will need to rely on account transfers to access funds.
- Accessibility: You can open and manage a Regular Savings account at any PenFED branch, online or via phone. However, the Premium Online Savings account is online only. However, you will receive a higher APY in compensation for it being slightly less convenient.
PenFED Money Market Certificate
APY Range
Minimum Deposit
Terms
Fees
PenFED Money Market Certificate
APY Range
Minimum Deposit
Terms
Fees
PenFED, like most credit unions, uses the term “money market certificate” rather than CD or “certificate of deposit,” but these products are the same to all extents and purposes. PenFED money market certificates offer tiered rates according to the term. The key features of this product include the following:
- Minimum Deposit: Regardless of your money market certificate term, you’ll need a minimum deposit of $1,000 to open an account.
- Term: You can choose a term for your money market certificate of between six months and seven years, but currently, the best rates are available for 12 to 24 months.
- Auto-Renewal: At the end of the term, when your certificate matures, it will automatically renew unless you stipulate nonrenewal. In this case, the funds will be deposited automatically into a regular savings account.
- Other Money Market Certificate Options: You can also open a money market certificate for IRA accounts and Coverdell education savings accounts. These require a minimum deposit of $500 but have more limited term options, starting at 12 months.
- Withdrawal Penalties: If you want to withdraw your funds before your money market certificate maturity date, there is a penalty based on the certificate term. This varies from 90 days of interest earned to a 30% penalty. For example, if your money market certificate has more than six months term and you withdraw in the first year, all dividends are forfeited.
Term | APY | Penalty |
|---|---|---|
6 Months | 2.90% | 90 days of dividends |
12 Months | 3.40% | 365 days / 30% of dividends |
18 Months | 3.25% | 365 days / 30% of dividends |
24 Months | 3.20% | 365 days / 30% of dividends |
36 Months | 3.20% | 365 days / 30% of dividends |
48 Months | 3.20% | 365 days / 30% of dividends |
60 Months | 3.20% | 365 days / 30% of dividends |
84 Months | 3.40% | 365 days / 30% of dividends |
Overall, credit unions CD rates tend to be high, and this is also correct for PenFed, which offers competitive rates and a variety of terms.
PenFED Checking Account
Fees
Minimum Deposit
Promotion
APY Checking
PenFED Checking Account
Fees
Minimum Balance
Promotion
APY Checking
PenFED has two checking account options: Access America Checking and Free Checking. You need to be a member with a savings account before you can open a checking account.
These accounts have different features and charges, which we’ll look at in a little more detail.
- This account has no monthly maintenance fees and can be opened with an initial deposit of at least $25.
- Offers a no fee overdraft. This starts at $300 and the line of credit has a fixed APR, currently 17.99%.
- The account offers the same Visa Debit card as the Access America account, with no ATM fees.
- With Free Checking, you can access free Bill Pay. There are no monthly services for this feature and you can pay your bills at any time of the day or night using your laptop, mobile phone or tablet.
If you are looking for alternatives, there are many other options for free checking accounts.
- Carries a $10 monthly service fee, but this can be waived if you maintain an average daily balance of $500+ or receive a direct deposit of $500 or more per month.
- You can be eligible for dividends if you have a $500+ recurring direct deposit. The interest paid will depend on your average daily balance, with a higher rate offered on accounts with a balance of $20,000 to $50,000. The dividends are paid monthly, but compounded daily.
- The account includes a free contactless debit card, compatible with Google Pay, Apple Pay and Samsung Pay. It is a Visa debit card that you can use with a network of 85,000+ ATM machines via Allpoint and CO-OP. There are no PenFED fees for using an out of network ATM.
4 Types Of Credit Cards
PenFED has a choice of four credit cards for its members. Each card offers different features or rewards to best suit your needs.
- PenFED Gold Visa: This card has a 0% APR introductory rate for balance transfers and purchases for 15 months. After this period, the rate is “everyday low” for purchases. There is no annual fee for the Gold Visa.
- PenFED Power Cash Rewards Visa: This card has no annual fee and offers 1.5% cash back on all purchases made with your card (2% for PenFed Honors Advantage Members). There is currently a welcome offer of $100 statement credit when you spend $1,500 in the first 90 days.
- PenFED Platinum Rewards Visa Signature: This card is designed to reward you for everyday spending. You’ll receive 5 points per dollar on gas station purchases and 3 points at supermarkets, restaurants and streaming or cable services. The card has no annual fee.
- PenFED Pathfinder Rewards Visa Signature: This card is designed for those who love to travel. You’ll earn 3 points on all travel categories (4 points for PenFed Honors Advantage Members), and 1.5 points on all other purchases . The card offers a complimentary Priority Pass airport lounge membership and reimbursement for Global Entry or TSA PreCheck fees. There is an annual fee, but this is waived for PenFED Honors Advantage Members.
PenFED Offers Student, Auto And Personal Loans
PenFED offers a variety of lending products including auto loans, personal loans, student loans, mortgages and home equity loans. These products have competitive rates and you can start the application process online.
To apply, you simply need to select the product on the website products menu at the top of the PenFED home page. You just need to click “Get Started” to launch an application.
If you’re already a PenFED member, you can submit your application via your Online account
Pros and Cons
PenFED is considered one of the best credit unions in the nation and offers some great benefits for customers. However, there are some drawbacks to consider before joining:
Pros | Cons |
|---|---|
Open Membership | Monthly Fee |
Competitive Rates | You Need a Savings Account |
Low Minimum Deposits | Limited Branches |
Large ATM Network | Stiff Early Withdrawal Penalties |
Dividends Compounded Daily | |
Online and Mobile Access
|
- Open Membership
PenFEDs open membership charter allows anyone throughout the U.S to join and access the various accounts and products.
- Competitive Rates
The Online Savings account and High Yield Checking Account both offer highly competitive rates without needing to maintain a high daily average balance.
However, the rates are still behind those you can find on the top savings accounts.
- Low Minimum Deposits
You can open a checking or savings account with $25 or less, which makes the accounts highly accessible for most people
- Large ATM Network
The accounts with debit cards can be used with a network of free ATMs that numbers over 85,000 machines.
- Dividends Compounded Daily
Dividends on checking accounts are compounded daily and then paid monthly.
- Online and Mobile Access
PenFED has an impressive online platform and app, so you can manage your accounts from the comfort of your own home or on the go.
- Monthly Fee
While you have an access to free checking, the PenFED Access America account requires a monthly fee.
Although the $10 monthly account fee is waivable, you’ll need to have at least $500 in direct deposits or maintain a $500 balance to not pay this.
- You Need a Savings Account
You need to open and maintain your savings account to maintain PenFED membership. This is also necessary to open a checking account or access other PenFED products.
- Limited Branches
There are only 50 PenFED branches throughout the U.S, which may be inconvenient for some customers. While you can manage your account online, it may be an issue if you like the reassurance of having a nearby physical branch.
- Stiff Early Withdrawal Penalties
If you need to access funds before your money market certificate matures, you will face a stiff penalty.
For example, if you have a certificate with a term longer than six months, if you make a withdrawal in the first year, you’ll forfeit all dividends.
PenFED Customer Service
PenFED has a customer service phone line available from 7 am to 11 pm EST, Monday through Friday. At weekends, you can access customer service from 8 am to 11 pm on Saturdays and 9 am to 5.30 pm on Sundays.
You can also access secure online messaging and contact the customer support team via the mobile app 24/7.
For this reason and due to its products and services, PenFed has an excellent reputation, with a 4.6/5 score on Trustpilot.
How to Join And Open a PenFED Account
To open a PenFED account, you’ll need to become a member. Fortunately, this is remarkably simple. Since PenFED is available to any American citizen or permanent resident, regardless of where they live.
You can visit a local PenFED branch or open your account online by visiting the PenFED website. If you’re not already a PenFED member, you’ll need to open a savings account first with a minimum $5 deposit.
You can choose your savings account and click the “open now” button. Next, you’ll need to complete the application form and provide personal details, including your name, address, and Social Security Number. PenFED will also need proof of your ID to comply with federal regulations.
FAQs
Is my money safe on PenFED?
PenFED is NCUA insured (National Credit Union Association). This offers similar protection to the FDIC coverage you’ll receive with bank accounts, so your money is safe even if the credit union fails.
What's the main reason to skip PenFED?
The insufficient funds charges are excessively high, so if you have a tendency to slip overdrawn, it may not be the right choice for you. You may also want to skip PenFED if you prefer being able to use a physical branch, as PenFED only has 50 across the entire country.
Can you buy/invest in gold via PenFED ?
No, PenFED does not offer gold investing
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How We Rate And Review Credit Unions: Our Methodology
The Smart Investor team extensively reviewed hundreds of banks and credit unions. We assessed them based on four main categories, each with specific features:
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Diversity of Products and Their Attractiveness (40%): We extensively analyzed the breadth and appeal of each bank's product offerings, including savings accounts, checking accounts, loans, investment options, and more. Higher ratings were assigned to banks with a diverse range of products that are attractive in terms of interest rates, fees, terms, and additional features. This category provides insights into the variety and value of the bank's offerings, crucial for meeting customers' diverse financial needs.
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Account Features (30%): This category delves into the features and benefits accompanying each bank's accounts. We scrutinized factors such as promotions, deposit and withdrawal options, ATM accessibility, online and mobile banking functionalities, as well as additional perks like overdraft protection and rewards programs. Banks offering comprehensive and convenient features received higher ratings, reflecting the overall value of their accounts to customers.
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Customer Experience (20%): A positive customer experience is paramount in banking, so we evaluated each bank's performance in this area. This included assessing the ease of account opening, quality of customer service, availability of support channels, and overall user satisfaction. Ratings were based on factors such as responsiveness, efficiency, and the bank's commitment to meeting customer needs, ensuring a seamless and satisfactory banking experience.
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Bank Reputation (10%): The reputation of a bank is a critical consideration for customers. We examined factors such as financial stability, regulatory compliance, and public perception to determine each institution's overall trustworthiness and reliability. Higher ratings were awarded to banks with strong reputations, reflecting their credibility and ability to inspire confidence among customers.
By considering these categories, individuals can make informed decisions that align with their financial needs and preferences, ensuring they choose a bank that offers competitive products, excellent features, a positive customer experience, and a solid reputation.
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