PenFed CD Rates: What You Need To Know Before You Open One
Written by
Sarah Sharkey
Edited by
Joe Evans
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If you’re hunting for better CD yields than you’ll find at a typical big bank, Pentagon Federal Credit Union (PenFed) CD rates are worth a close look. PenFed calls its CDs “money market certificates,” but they work just like traditional CDs: you lock in a fixed rate for a set term and get guaranteed, predictable returns.
As of early December 2025, PenFed money market certificate rates range from 2.7% to 3.1% APY on terms from 6 months to 7 years, with a $1,000 minimum deposit. These numbers will power your article when it goes live on Jan. 1, 2026, though rates can change at any time, so always suggest that readers double-check PenFed’s site before opening an account.
For comparison, the national average 12-month CD rate is about 1.63% APY as of December 2025 and the best 1-year CDs are still around 4.15% to 4.3% APY at top online banks and credit unions. PenFed lands in the “strong but not top of the heap” tier.
Current PenFed CD Rates: Early 2026 Snapshot
PenFed’s standard CDs are called Money Market Certificates.
Here’s the latest rate sheet available as of Dec. 3, 2025, which you can present as the “current PenFed CD rates for 2026” with a clear as-of date.
| Term Length | APY | Minimum Deposit |
|---|---|---|
| 6 months | $1,000 | |
| 12 months | $1,000 | |
| 15 months | $1,000 | |
| 18 months | $1,000 | |
| 2 years | $1,000 | |
| 3 years | $1,000 | |
| 4 years | $1,000 | |
| 5 years | $1,000 | |
| 7 years | $1,000 |
At a glance:
- Top PenFed CD rate: up to 3.1% APY on popular terms like 12, 15 and 18 months
- Term range: from 6 months to 7 years
- Minimum deposit: $1,000 for most certificates
PenFed’s IRA and Coverdell education certificates pay 2.8% to 3% APY with similar term ranges, plus a $500 minimum for Coverdell certificates.
CD Early Withdrawal Penalties
If you want access to your funds early, you’ll encounter an early withdrawal penalty. The amount depends on the CD term and when the withdrawal occurs.
| CD Term | When You Withdraw | Penalty |
|---|---|---|
| 6-month or 182-days | Any time before maturity | Loss of the most recent 90 days of dividends earned |
| 12 to 84 months | Within 365 days of opening | Loss of the last 365 days of dividends earned |
| 12 to 84 months | After 365 days of opening | 30% of the total dividends that would have been earned if held to maturity |
IRA Certificates
If you want to use certificates as a part of your retirement savings strategy, working with PenFed IRA certificates might be the right choice. You can choose to contribute to a Roth, traditional or SEP IRA to build your retirement savings. Within these accounts, you can select certificates to suit your savings goals.
Here’s a breakdown of PenFed’s IRA CD rates:
| Term Length | APY | Minimum Deposit |
|---|---|---|
| 1 year | $1,000 | |
| 2 years | $1,000 | |
| 3 years | $1,000 | |
| 4 years | $1,000 | |
| 5 years | $1,000 | |
| 7 years | $1,000 |
Coverdell Education Savings Certificates
The final certificate opportunity offered by PenFed is for the credit union’s Coverdell education savings certificates. If you are saving for a child’s education, this could be the low-risk solution you are searching for. You can start saving with just $500.
Here’s a breakdown of the rates available:
| Term Length | APY | Minimum Deposit |
|---|---|---|
| 1 year | $500 | |
| 2 years | $500 | |
| 3 years | $500 | |
| 4 years | $500 | |
| 5 years | $500 | |
| 7 years | $500 |
These certificates are designed to help you save for educational expenses. But if you need to withdraw funds before the maturity date, you’ll still face an early withdrawal penalty.
Pros of PenFed CDs
When considering PenFed CDs, the following benefits come into play:
- NCUA insurance: Your funds are protected for up to $250,000 per account holder, per account type.
- Guaranteed returns: When you tuck your funds into a CD, the returns are guaranteed for the term.
- No monthly maintenance fees: You won’t face monthly maintenance fees to grow your funds through these CDs.
- Straightforward online banking: An easy-to-use online banking platform and mobile app make it easy to manage your funds from anywhere.
Cons of PenFed CDs
These are some of the downsides to consider, though:
- Minimum deposit: $1,000 might be steep for some, especially if this is your first account.
- Early withdrawal penalties: If you need the money in a hurry and need to withdraw before the term matures, you’ll have to consider whether it’s worth taking away some of your savings.
- Membership required: You cannot open a CD at PenFed without being a member first. Banks don’t typically require membership the way that credit unions do.
- Lower rates: Rates can be lower compared to competitor credit unions or banks.
How Much Can You Earn With a PenFed CD?
The earnings on a CD at PenFed will depend on:
- Your deposit amount
- The CD’s term length
- The annual percentage yield (APY)
Here’s an estimate of what you can earn with some of PenFed’s CDs:
| Deposit Amount | Term Length | APY | Estimated Interest Earned |
|---|---|---|---|
| $1,000 | 1 year | $31 | |
| $2,500 | 1 year | $77.50 | |
| $10,000 | 1 year | $310 |
The GOBankingRates Savings Calculator can also show you how much your savings could earn over time.
How To Open a PenFed CD
Here’s a simple, skimmable step-by-step section you can reuse:
- Become a PenFed member
- You’ll open a membership first with a savings account
- Anyone can qualify, often by joining a partner association for a small one-time fee
- Choose your CD term
- Short goals: 6, 12, 15 or 18 months
- Longer goals: 2, 3, 5 or 7 years
- Confirm current rates
- Check PenFed’s certificate rates page to confirm APYs on the day you open the CD, since rates can change without notice.
- Gather your information
- Name, address and contact info
- Social Security number or taxpayer ID
- Existing bank account info to fund the certificate
- Fund the certificate
- Transfer at least $1,000 from a linked account or an existing PenFed account
- Decide whether dividends should be reinvested into the certificate or paid to another account
- Set reminders for maturity
- PenFed CDs auto-renew
- Use a calendar reminder to review your rate and decide whether to roll over, switch terms or move funds during the grace period
PenFed CD Rates vs. Other Banks
As of Oct. 20, 2025, the national average rate on a 12-month CD is 1.68%. In contrast, PenFed’s option offers APY. With that, it’s undeniable that PenFed offers reasonably competitive rates. However, higher rates are available elsewhere.
MOST COMPARABLE
MOST COMPARABLE
MOST COMPARABLE
Fees
Fees
Fees
Early withdrawal penalty may apply
Early withdrawal penalties may apply
No monthly service fee
APY
APY
APY
Up to
Up to
Up to
Min Opening
Min Opening
Min Opening
$0
$1,000
$0
Here’s a closer look at other top CD rates:
| Financial Institution | CD | APY | Minimum Deposit |
|---|---|---|---|
| PenFed | 12 months | $1,000 | |
| Synchrony Bank | 12 months | $0 | |
| First Internet Bank | 12 months | $1,000 |
Alternatives To PenFed CDs
In addition to CDs, PenFed offers a variety of other savings products. These include:
- Premium Online Savings: PenFed’s high-yield savings account currently offers APY, which provides liquidity without skimping on interest.
- Access America Checking: If you want to keep some funds in your checking account, this interest-bearing account still puts your funds to work on some scale.
Is a PenFed CD Right for You?
A PenFed CD could be a smart move if you:
- Want better-than-average CD rates without chasing every weekly promo
- Like the idea of banking with a large, well-known credit union rather than a small online bank
- Can commit at least $1,000 for a fixed term
- Plan to build a simple CD ladder using 12-, 18- and 24-month terms
You might want to keep shopping if you:
- Are focused on the absolute highest APY available in the country right now
- Prefer shorter terms under 6 months or no-penalty CDs
- Think you may need your cash early and would be better off in a high-yield savings account or a more flexible product
Final Take
PenFed offers a wide range of CD options with competitive rates. The opportunity might be the right fit for some savers. But if you don’t like what you see, don’t be afraid to keep looking for the best deal for your situation.
Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Jan. 1, 2026.
Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.
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- FDIC. 2025. "National Rates and Rate Caps."
