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Funding those Penfed 5% CDs
Old 12-23-2010, 11:36 PM   #1
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Funding those Penfed 5% CDs

I locked in a couple of those Penfed 5% 10 year and knew I needed to get some more money into my share account at Penfed.

I found out a nasty surprise. Penfed limits you to $5,000 for an ACH transfer from your checking/brokerage account to your shareaccount.

Fortunately they do allow you to make transfers out in the future so I have a bunch of $5,000 scheduled for next week. Just a warning if you hadn't done so.
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Old 12-23-2010, 11:57 PM   #2
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ouch, good to know! Thanks for the heads-up.

Edit: actually I am limited to $50 daily for ACH transfers from my checking account... Can I wire the money in?
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Old 12-24-2010, 01:27 AM   #3
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You might want to check.... some places also have a monthly ACH limit... so you might not be able to make all those $5K transfers...
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Don't ACH Then
Old 12-24-2010, 04:58 AM   #4
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Don't ACH Then

Quote:
Originally Posted by clifp View Post

I found out a nasty surprise. Penfed limits you to $5,000 for an ACH transfer from your checking/brokerage account to your shareaccount.
Add the account you want to transfer from as an external account to your Penfed account. Then simply select the external account as the source of funds when you set up the CD online. They will do a direct debit of the external account. I routinely fund Penfed CDs this way. Very easy. Free too. You earn interest on the funds immediately. I don't know if there is a limit this way but you can transfer much more than $5K.
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Old 12-24-2010, 06:03 AM   #5
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Originally Posted by hellbender View Post
Add the account you want to transfer from as an external account to your Penfed account. Then simply select the external account as the source of funds when you set up the CD online. They will do a direct debit of the external account. I routinely fund Penfed CDs this way. Very easy. Free too. You earn interest on the funds immediately. I don't know if there is a limit this way but you transfer much more than $5K.

Great tip, thanks!

Say, does anyone know:

Are we at this point 'locked-in' on both amount and duration for our 'reservations'?

I had a relatively small CD roll over, so that allowed me to make a reservation, so I did so for a ten year certificate.

What I would *really* like to do though, is add quite a bit more, and also go for the seven year duration instead of the ten year.
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Old 12-24-2010, 06:46 AM   #6
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What is the early redemption penalty on these should interest rates rise significantly?
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Old 12-24-2010, 08:24 AM   #7
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Originally Posted by hellbender View Post
Add the account you want to transfer from as an external account to your Penfed account. Then simply select the external account as the source of funds when you set up the CD online. They will do a direct debit of the external account. I routinely fund Penfed CDs this way. Very easy. Free too. You earn interest on the funds immediately. I don't know if there is a limit this way but you can transfer much more than $5K.
That works well for regular CDs. But for reservations, the only option is to fund from a PenFed account. I tried to edit my reservations so as to fund the 5% CDs directly from my external checking account and the option is not available.

Edit: I just called PenFed. My only viable funding options are wiring the money in or sending a check by mail.
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Old 12-24-2010, 08:52 AM   #8
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I did 100K transfer the other day from Vanguard and it went right through.
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Old 12-24-2010, 09:42 AM   #9
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Originally Posted by hellbender View Post
Add the account you want to transfer from as an external account to your Penfed account. Then simply select the external account as the source of funds when you set up the CD online. They will do a direct debit of the external account. I routinely fund Penfed CDs this way. Very easy. Free too. You earn interest on the funds immediately. I don't know if there is a limit this way but you can transfer much more than $5K.

Yup. I did this last year and it worked great. After wasting my time doing a series of $5000 transfers.
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Old 12-24-2010, 09:48 AM   #10
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Guess we should have started this thread earlier. I had rejected having PenFed ACH funds in bc I thought they charged $5. Then after calculating how much interest I would lose bc of mail transit time, I reconsidered and then discovered the 5K daily limit. Don't like the $30 wire fee either so I'm finally doing my USPS experiment. Last time I rolled over an IRA to PenFed, it took a week to go to their OR site (from next door in CA). So now I'm splitting funds between their OR and NE sites (was going to do a 3 way to DC
but no free envelope that I thought I had). Theory is that close stuff goes by truck and far stuff goes by plane and sending to farther site might actually be faster.
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Old 12-24-2010, 09:59 AM   #11
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Wow, you guys wait until the last minute. As soon as I reserved my CD I sent the money to sit in the PF share account. Why monkey around for a percent or two?
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Old 12-24-2010, 10:36 AM   #12
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Wow, you guys wait until the last minute. As soon as I reserved my CD I sent the money to sit in the PF share account. Why monkey around for a percent or two?
Until 3 days ago, the money going to the PenFed CDs was tied in stock options...
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Old 12-24-2010, 11:18 AM   #13
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Why not mail them a check and benefit from the float?
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Old 12-24-2010, 11:36 AM   #14
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I have the cash in the PenFed Regular Share account and I wanted to transfer it to the Roth IRA share account to fund the CDs for a Roth IRA. All the accounts are all set up but you can't transfer from Regular Share to Roth IRA share online, you have to call and have them do it.

I'm doing a 2010 Roth IRA and also a 2011 Roth IRA.

We still have the ability to edit our CD reservations, but you can only reduce them or change the date, you can't increase your reservation.
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Old 12-24-2010, 12:54 PM   #15
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We still have the ability to edit our CD reservations, but you can only reduce them or change the date, you can't increase your reservation.
......so if the mailed check gets delivered early, we can start the CD earlier than reserved?

for LOL: some of us are in the unfortunate situation where the the funds are in a savings account; they have to be moved to a no-interest checking to fund the check. There is a small overdraft fee if you don't move the funds to checking before the check is presented so it's kind of a game as to when to move the funds. At these interest rates, not a big deal but still.............
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Old 12-24-2010, 01:02 PM   #16
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I did 100K transfer the other day from Vanguard and it went right through.
Me too, only from Fidelity.
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Old 12-24-2010, 02:17 PM   #17
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Me too, only from Fidelity.
I can't get Fidelity to transfer funds from my IRA or 401k. They only want to mail me a check. I have a penfed branch within 12 miles or may do the scan deposit.
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Old 12-24-2010, 09:43 PM   #18
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After wasting my time doing a series of $5000 transfers.
That direct-funding option never occurred to me either...
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Old 12-24-2010, 09:57 PM   #19
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......so if the mailed check gets delivered early, we can start the CD earlier than reserved?

for LOL: some of us are in the unfortunate situation where the the funds are in a savings account; they have to be moved to a no-interest checking to fund the check. There is a small overdraft fee if you don't move the funds to checking before the check is presented so it's kind of a game as to when to move the funds. At these interest rates, not a big deal but still.............
My reservation was for the 14th of Jan and once my money was received I asked to move up the date to the 1st and it was no problem.
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Old 12-25-2010, 08:32 AM   #20
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My reservation was for the 14th of Jan and once my money was received I asked to move up the date to the 1st and it was no problem.
73ssxxx.........thanks! good to know......certainly better to light a candle than to curse the dark.......tho I thought I had asked and didn't get a straight answer or maybe just dreamed that.......
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