Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
PenFed CD reservation offer
Old 08-22-2010, 11:20 AM   #1
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Posts: 2,423
PenFed CD reservation offer

Didn't see this posted yet.

Back in 2007 we bought some of PenFeds 6% CDs. Folks here at ER.org posted about it and that's what got us to join PenFed. We bought the 3 year ones so they are maturing in a few months.

I was on the site checking on those. If you currently have a CD click the link for CERTIFICATE OPTIONS and there is a link on the right -

Promotions
Certificate Reservations
Lock in a high-yield on 5, 7 and 10 year certificates

That takes you to

I haven't gotten anything in the mail yet. Not sure if this is limited to the amount of your maturing certificates.

I've never done a CD longer than 3 or 5 years. What are your thoughts on -
5 year - 3.50%
7 year - 4.25%
10 year - 5.00%

I don't know if this is only available to those of us with CDs about to mature.
__________________

__________________
Married, both 62. DH retired June, 2010. I have a pleasant little part time job.
Sue J is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-22-2010, 11:59 AM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
calmloki's Avatar
 
Join Date: Jan 2007
Location: Independence
Posts: 5,459
Quote:
Originally Posted by Sue J View Post
...

5 year - 3.50%
7 year - 4.25%
10 year - 5.00%

I don't know if this is only available to those of us with CDs about to mature.
Several of us took advantage of the Penfed advance reservation for maturing certificates back in December for certs maturing in January. It was worth doing - got us about a 1/4 point extra AIR. Check the early cancellation penalties - I bought 5 year because I could cash them in close to the 2 year mark and still make better interest after paying penalty than with the 2 year certs. And if they were held longer the rate was locked in at a higher rate. Still catching the odd bit of flak about not buying 7 year instead of 3 back when the rate was 6.25%....
__________________

__________________
calmloki is offline   Reply With Quote
Old 08-22-2010, 12:25 PM   #3
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,487
it appears that this can be funded from a "regular share account", so apparently is available even if you do not have a maturing CD. if the early withdrawal penalty is 1 year's interest (as is the 7 yr), this could be a good deal! assuming you close it early, say after 3 yrs, you'd have earned about 3.33% annually which beats any other 3 yr CD currently available. ... so it depends on what that early withdrawal penalty might be.
__________________
d is offline   Reply With Quote
Old 08-22-2010, 01:01 PM   #4
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Posts: 2,423
I found a chart someone else made about this offer's early cancellation penalty.

From Select PenFed Members Can Reserve CDs with Yields from 3.50% to 5.00%

__________________
Married, both 62. DH retired June, 2010. I have a pleasant little part time job.
Sue J is offline   Reply With Quote
Old 08-22-2010, 01:53 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
I do not think I have ever seen PF offer a 10 year certificate. At 5% that is almost double the yield you would get on an equivalent treasury. I would buy that one if I were up for renewal.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 08-22-2010, 02:07 PM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Hmmm, I did not see a link for certificate options. Since I do not have a CD maturing until 2014 maybe this is onl for those with imminent maturities. Can anyone confirm?
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 08-22-2010, 02:25 PM   #7
Thinks s/he gets paid by the post
 
Join Date: Mar 2010
Posts: 1,648
Don't know if this will help anyone ...but last year I was looking at the PenFed Certificates..as they had the best rate I could find. I opened a share account. I was looking at the 4% for 7 years. Things may have changed since then. Anyhoo....the bank where I had my 2 jumbo CD's that were coming due..wouldn't do anything for me UNTIL....I called them and told them I was coming to get a cashiers check. At that point, they told me they would match what PenFed was doing. Worth a try...if anyone finds it cumbersome to either add another bank. Personally I like being able to go into a branch and PenFed is too far away for me to be able to do that.

I took advantage of Wachovia's 5.35% for 5 years back in 2008....as well.

Also, I think like the rest of you here. As long as I have held it 2 to 3 years...IF rates go up....I can take the penalty and be ahead.
That IF is a big IF. Cd rates have not gone up much past 5% in what...over 10 years

I have another jumbo coimng due next year...and plan to see what PenFed is doing at that time.
__________________
sheehs1 is offline   Reply With Quote
Old 08-22-2010, 05:21 PM   #8
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,487
Brewer: if you have an existing CD, even if it's not maturing, sign on, on the main menu page, right side under "I Want to ..." click on "more" to get to "other services". then under "account services" click on "Certificate Options", then you should see
Promotions / Certificate Reservation" in the upper right.
__________________
d is offline   Reply With Quote
Old 08-23-2010, 09:08 AM   #9
Full time employment: Posting here.
 
Join Date: Nov 2009
Location: VA
Posts: 923
That's a pretty solid offer on the 10-year.
__________________
Disclaimer - I am an independent insurance agent. If the above message contains insurance-related content, it is NOT intended as advice, and may not be accurate, applicable or sufficient depending on specific circumstances. Don't rely on it for any purpose. I do encourage you to consult an independent agent for insurance-related advice if you have a question that is specific in nature.
dgoldenz is offline   Reply With Quote
Old 08-23-2010, 01:22 PM   #10
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 7,432
Didn't credit union insurance get bumped from 100k to 250k like banks earlier this year? I may have to move more over to PF.
__________________
Retired 3/31/2007@52
Full time wuss.......
Dawg52 is offline   Reply With Quote
Old 08-23-2010, 01:47 PM   #11
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,074
Quote:
Originally Posted by Dawg52 View Post
Didn't credit union insurance get bumped from 100k to 250k like banks earlier this year?
Yep.

Quote:
The basic insurance amount is $250,000 per individual account holder, per federally insured credit union.
http://www.ncua.gov/resources/ShareI...ceFundFAQs.htm
__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 08-23-2010, 02:19 PM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 7,432
Quote:
Originally Posted by REWahoo View Post
OK, thanks. I just reserved some with new money from cd's maturing at Fidelity later this year. Good timing for me.
__________________
Retired 3/31/2007@52
Full time wuss.......
Dawg52 is offline   Reply With Quote
Old 08-24-2010, 06:34 PM   #13
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Thanks Sue for posting this. I have 6% CD renewing in early Oct. There is a full .5% difference between the rates in Jan and the current rates for renewing a CD. The 5 year rate is currently 3%.

Thanks to that handy chart I know that even if I treat this as 5 year CD, I still coming out almost 1% ahead a year. The only downside is my money while be earning no interest from when matures Oct to Jan.

So lets see on $25,000 that $250 a year from reading the ER forum, sweet.
__________________
clifp is offline   Reply With Quote
Old 08-24-2010, 06:41 PM   #14
Thinks s/he gets paid by the post
73ss454's Avatar
 
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,378
I did 100K for January for 10 years.

Pen Fed gave me a hard time and told me I could not participate because I diidn't have a CD expiring in Oct.. I didn't see any disclaimer to this fact and called back later and the next rep said the same thing to me. She put me on hold and after a while came back and said I was good to go but they are not publicly announcing it.

I don't know what that means when it's on their website. At least I'm locked in.
__________________
73ss454 is offline   Reply With Quote
Old 08-24-2010, 06:47 PM   #15
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 7,432
Quote:
Originally Posted by 73ss454 View Post
I did 100K for January for 10 years.

Pen Fed gave me a hard time and told me I could not participate because I diidn't have a CD expiring in Oct.. I didn't see any disclaimer to this fact and called back later and the next rep said the same thing to me. She put me on hold and after a while came back and said I was good to go but they are not publicly announcing it.

I don't know what that means when it's on their website. At least I'm locked in.
That is odd they gave you a hard time. I guess the customer service people were not informed. I simply reserved mine using their website and got an email confirming my reservation.
__________________
Retired 3/31/2007@52
Full time wuss.......
Dawg52 is offline   Reply With Quote
Old 08-24-2010, 06:49 PM   #16
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
So anybody see the downside to borrowing mortgage money from Penfed at 3.875 (10 year mortgage) and than depositing it at 5%??
__________________
clifp is offline   Reply With Quote
Old 08-24-2010, 06:52 PM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by clifp View Post
So anybody see the downside to borrowing mortgage money from Penfed at 3.875 (10 year mortgage) and than depositing it at 5%??
Probably almost no net profit after costs and taxes, but feel free.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 08-24-2010, 06:53 PM   #18
Thinks s/he gets paid by the post
73ss454's Avatar
 
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,378
Closing costs?
__________________
73ss454 is offline   Reply With Quote
Old 08-24-2010, 07:14 PM   #19
Recycles dryer sheets
 
Join Date: Jan 2008
Posts: 220
Quote:
Originally Posted by clifp View Post
I have 6% CD renewing in early Oct. There is a full .5% difference between the rates in Jan and the current rates for renewing a CD. The 5 year rate is currently 3%.

.
Unless they have discontinued it, they have been giving a .25% bump on renewing CD's for a year or more.You would need to call a CSR to verify, but it would make this offer only a a .25 increase over your renewing CD.

This may or may not change how you look at it.

HTH
__________________
Dave J is offline   Reply With Quote
Old 08-24-2010, 07:21 PM   #20
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Ya closing cost are pretty significant. Sadly after paying of the mortgage I am taking a standard deduction.

Still if you are looking at doing a refinance. It probably makes sense to add another $100K or so and stick it into a Penfed 10 year CD. If interest rates remain the same you are making a small profit and if they do go up you you take the early withdrawal and you have additional $100K at a low interest rate.
__________________

__________________
clifp is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Penfed CC Gearhead Jim FIRE and Money 13 05-21-2010 08:28 AM
A message from Penfed cute fuzzy bunny FIRE and Money 20 07-25-2008 06:39 PM
Some questions on PenFed RDamien FIRE and Money 7 07-10-2008 11:03 PM
PenFed qbkatran FIRE and Money 1 01-01-2006 11:17 PM
Penfed Heads-up Bob_Smith FIRE and Money 8 02-26-2004 02:33 PM

 

 
All times are GMT -6. The time now is 07:04 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.