Pentagon Federal Credit Union review: Easy to become a member, competitive rates on savings and certificates

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  • Pentagon Federal Credit Union (federally insured by the NCUA) pays competitive interest rates.
  • You can bank online or in person if you live in one of 13 states, Guam, Puerto Rico, or Japan.
  • It’s easy to become a member of PenFed, even if you aren’t a member of the military.
  • See Business Insider’s picks for the best high-yield savings accounts »

Updated on 2/16/2021: We updated this review with a new section on PenFed’s Better Business Bureau rating and reputation as a company. We’re currently adding information on trustworthiness to all of Personal Finance Insider’s reviews.

You’re eligible if you have served in the military or work at qualifying associations or organizations. But the easiest way to join is to simply open a savings account with a $5 minimum deposit.

Is Pentagon Federal Credit Union a good match?

You might like PenFed if you…You might not like PenFed if you…
  • Want to earn a competitive APY on your savings account or certificate
  • Want to earn interest on your checking account balance
  • Plan to open a certificate with a term longer than five years
  • Are comfortable banking digitally, OR live near a branch
  • Value accounts that compound interest daily rather than monthly
  • Don’t qualify to earn interest on your checking account balance
  • Want to earn a competitive APY on a money market account
  • Don’t qualify to waive monthly fees for the checking account
  • Aren’t comfortable banking digitally, OR don’t live near a branch

The bottom line: If you prefer a credit union over a bank, Pentagon Federal Credit Union is a good choice. It’s easy to become a member, and it pays competitive rates on savings, checking, and CDs.

Pentagon Federal Credit Union Premium Online Savings Account review

Pentagon Federal Credit Union Premium Online Savings Account

Pentagon Federal Credit Union Pentagon Federal Credit Union Premium Online Savings Account

The main downside is that your money will compound monthly, whereas many institutions’ savings accounts compound your interest daily and pay monthly. Monthly compounding ends up earning you less interest than daily compounding, and depending on how high your balance is, this may or may not make a big difference in how much you earn.

Pentagon Federal Credit Union also offers a Regular Savings Account, but it pays a low APY and doesn’t offer any clear benefits over the PenFed Premium Online Savings account.

Pentagon Federal Credit Union Access America Checking Account review

Pentagon Federal Credit Union Access America Checking Account

Pentagon Federal Credit UnionPentagon Federal Credit Union Access America Checking Account

You can definitely find a checking account with lower fees than this one. PenFed charges a $10 monthly fee, although you can waive the fee if you maintain a $500 daily balance or receive monthly direct deposits of $500 or more. PenFed has a large ATM network, but it charges $1.50 when you use an out-of-network ATM. Many banks charge a $2.50 out-of-network ATM fee, but you can find plenty that don’t charge a fee and even reimburse any out-of-network ATM fees charged by ATM providers.

Pentagon Federal Credit Union Money Market Certificate review

Pentagon Federal Credit Union Money Market Certificate

Pentagon Federal Credit Union Pentagon Federal Credit Union Money Market Certificate

Money market certificates are probably the credit union’s strongest product. Terms go up to seven years, whereas many banks only offer CD terms up to five years. Rates are competitive, and unlike other PenFed accounts, interest compounds daily and is paid monthly, meaning you earn more in interest.

The six-month certificate is the weak link among the money market certificates. This certificate earns simple interest, so it doesn’t compound. With other institutions, you can find a six-month certificate that compounds interest.

Also, beware that early withdrawal penalties are high for the shorter-term certificates. PenFed charges 365 days interest for an early withdrawal for certificates of 12 months or more. That’s not so bad for a seven-year term, but it’s steep for a one-year term.

Pentagon Federal Credit Union Money Market Savings review

Pentagon Federal Credit Union Money Market Savings

Pentagon Federal Credit Union Pentagon Federal Credit Union Money Market Savings

The PenFed Money Market Savings account will send you paper checks, but the account doesn’t come with a debit card. You can also find a higher APY elsewhere, especially if your balance is under $10,000. All in all, the money market account is a weak link for PenFed.

Pentagon Federal Credit Union features

PenFed has 68,000 free ATMs nationwide. It has around 50 branch locations in Washington DC and the following US states:

  • California
  • Florida
  • Georgia
  • Hawaii
  • Maryland
  • Nebraska
  • New Jersey
  • New Mexico
  • New York
  • North Carolina
  • Pennsylvania
  • Texas
  • Virginia

The credit union also has branches on military bases in Guam, Puerto Rico, and Japan.

PenFed offers a checking and money market account, two savings accounts, and various money market certificates with terms up to seven years. Its Premium Online Savings Account and Money Market Certificates are its strongest products, and the checking account is a worthwhile option if you can opt out of the monthly fees and qualify to earn interest.

To contact customer service with questions, call Monday through Friday, 7:00 a.m. to 11:00 p.m. ET. Or call Saturdays from 8:00 a.m. to 11:00 p.m. ET, or Sundays from 9:00 a.m. to 5:30 p.m. ET.

You can also contact customer service via email, snail mail, or fax, but there is no live online chat option.

Your PenFed accounts are federally insured by the NCUA for $250,000, or $500,000 for joint accounts.

Is PenFed trustworthy?

The Better Business Bureau gives Pentagon Federal Credit Union an A+ in trustworthiness. A good BBB rating signifies a company responds effectively to customer complaints, has honest advertising practices, and is transparent in how it handles business.

The credit union doesn’t have any public scandals. Between the strong BBB rating and clear history, you may feel comfortable banking with PenFed.

How Pentagon Federal Credit Union compares to similar credit unions

We’ve compared PenFed to two other popular credit unions: Navy Federal and Alliant.

Pentagon Federal Credit Union
Navy Federal Credit Union
Alliant Credit Union

Branch locations

13 US states, DC, Guam, Puerto Rico, Japan

Branch locations

30 US states, DC, Guam, overseas

Branch locations

Online only

Savings APY

0.50% APY

Savings APY

0.25% to 0.50% APY

Savings APY

0.55% APY

Monthly service fees

$0 to $10

Monthly service fees

$0 to $10

Monthly service fees


Open an accountOpen an accountOpen an account

Pentagon Federal Credit Union review vs. Navy Federal Credit Union review

Your choice between PenFed and Navy Federal will likely come down to two main factors: membership eligibility and branch locations.

It’s more difficult to join Navy Federal than PenFed; you must be tied to the armed forces or have a family member who is already a member of the credit union. You can also be a Department of Defense civilian employee, veteran, or extended family member. If you qualify to join both credit unions, your decision may rely on the closest branch. Navy Federal has more locations across more US states than PenFed.

Maybe you’re eligible to join either credit union and have nearby branches for both institutions. Your decision could come down to which type of account is most important to you.

PenFed pays a higher APY on your savings account balance. However, Navy Federal has more checking account options and pays a higher rate on money market accounts. When it comes to certificates, the higher rate will depend on the term length you’re interested in.

Pentagon Federal Credit Union review vs. Alliant Credit Union review

First things first: If you don’t like banking digitally, and you live near a PenFed branch, you should go with PenFed. Alliant is an online-only credit union with no brick-and-mortar locations.

If you’re comfortable banking online, Alliant is a worthwhile option — we’ve listed it as on of our top picks for online banking.

Otherwise, your choice could come down to which account you prioritize. If you want a money market account, you’ll want to go with PenFed, because Alliant doesn’t offer a money market account. PenFed also pays a higher APY for savings than Alliant. Alliant pays the same rate for all checking account balances. You’ll earn more with Alliant if your balance is under $20,000, but more with PenFed if your balance is over $20,000. The better APY for a certificate will depend on your term length.

Alliant offers savings and checking accounts specifically for minors, so if you want to open accounts for your kids, Alliant might be the better fit.

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