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The NFCU vs USAA vs PenFed Guide

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The NFCU vs USAA vs PenFed Guide

The NFCU vs USAA vs PenFed Guide

 

As a member of all three of these financial institutions. I have been looking at them to compare and contrast the differences of each in hopes of getting the most benefit out of each. I believe that this post can help clarify some of the differences of all three which traditionally have been restricted to those with a military affiliation. 

 

I plan on updating this post monthly as product and rates change. Please feel free to point out any errors, mistakes or improvements that can make this post help others in the future. 

 


















Your FICO credit scores are not just numbers, it’s a skill.

Message 1 of 41
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Valued Contributor

Navy Federal Credit Union (NFCU)

nfcu-logo.png

 

Navy Federal Credit Union (NFCU) is the largest credit union in the world. Since 1933, NFCU has grown from 7 members to over eight million members. Unlike the largest banks, NFCU offers competitive rates on checking and share certificates.

 

Eligibility for membership is limited to members of the military, veterans, individuals who have current ties to the armed forces, Department of Defense, or National Guard or have an immediate family member who has a membership with Navy Federal or is eligible to join. 

 

Accounts and other products: Credit unions, even big ones, typically offer better rates than banks. NFCU’s rates include 3.50% returns on 12-month Special EasyStart Certificates and annual percentage yields of 0.35% or more on one of its interest checking accounts with a $1,500 average daily balance. It also offers low credit card and auto loan rates.

 

ATMs and branches: NFCU has a strong presence on and near military installations in the U.S. and abroad. The credit union also belongs to the Co-op network, giving members fee-free access to more than 30,000 ATMs throughout North America. When you use overseas Visa/PLUS ATMs, NFCU typically charges up to 1% and $1 per transaction.

 

Key Points

  • High rates for share certificates
  • No monthly fees on basic savings and several checking accounts
  • Over 30,000 free ATMs, plus some checking accounts offer ATM fee rebates
  • Secured Share Loan Friendly (SSL) for credit building
  • Monthly FICO Score 9 based on Equifax data
  • All credit cards have no balance transfer or foreign transaction fees 
  • Hard Inquiry for all credit products and credit line increases
  • Small branch network
  • 0.25% APY on basic savings

Checking

  • All five NFCU checking accounts earn dividends, with solid free and low-cost options

Savings

  • Membership requires an NFCU savings account, with a minimum deposit of $5
  • Good savings rate among military-affiliated financial institutions: NFCU's basic annual percentage yield of 0.25% 
  • Multiple options: NFCU also offers a term-based savings account and money market accounts that pay higher interest rates

 

Credit Cards

  • cashRewards Mastercard - Earn 1.5% cashback on purchases. Redeem as soon as you earn. No AF. Variable APR 11.65% - 18.00%
  • More Rewards AmEx - Maximize your everyday spending with 3X points at gas stations, supermarkets, restaurants and for transit; 1X point on everything else. No AF. Variable APR 11.65% - 18.00%
  • VISA Signature Flagship Rewards - Earn 3X points for every $1 you spend on travel and 2X points on everything else. $49 AF. Variable APR 11.99% - 18.00%
  • GO REWARDS VISA Signature - Earn more when on the go. Get 3X points on restaurants, 2X points on gas and 1X point on everything else. No AF. Variable APR 10.99% - 18.00%
  • Platinum VISA - Minimize monthly payments with NFCU’s lowest rate card. No AF. Variable APR 7.99% - 18.00%
  • nRewards Secured Mastercard - Build or repair your credit while earning rewards. No AF. Variable APR 18.00%

Share Certificates

  • Competitive rates: NFCU’s share certificates are among the best you will find at any financial institution. NFCU’s Special EasyStart 12-month promotional certificate comes with an APY of 3.50%
  • Details on longer terms: 9-month certificates with the standard minimum deposit of $1000 earn 2.50% APY, 18-months terms earn 3.00% and five-year terms get 3.25%.

Credit Union Experience

  • Small branch network, strong web-banking: NFCU has fewer than 400 branches worldwide, a large number of them near military bases in places such as Virginia, Maryland, and California. For mobile banking, NFCU offers apps with decent ratings for Android and iOS devices. 
  • Member Support, NFCU provides live phone support 24/7/365 as well as online chat support

Overdraft Fees

  • NFCU’s nonsufficient funds' fee is $29 — expensive but slightly better than the $31 to $34 that many banks and credit unions charge when you try making a transaction online or by check without enough funds. 
  • OOPS: You can also sign up for the Optional Overdraft Protection Service, or OOPS, which limits your overdraft fees to $20, with a maximum of three charges per day. That means you could still be charged up to $60 in a day. If you choose not to sign up, one-time debit swipes and ATM withdrawals will simply be declined at no charge.
  • Overdraft alternatives: You can avoid a nonsufficient funds fee by linking a savings account or line of credit for overdraft protection. Unlike many other financial institutions, NFCU doesn’t charge to transfer money for this service, but the line of credit has an annual percentage rate starting at 13.90%. 

 

 


















Your FICO credit scores are not just numbers, it’s a skill.

Message 2 of 41
Valued Contributor

United Services Automobile Association (USAA)

 

usaa-review.png

United Services Automobile Association (USAA) is best known for its automobile insurance products. It was founded in 1922 by a group of 25 U.S. Army officers as a way to provide for mutual self-insurance for their automobiles. Today, USAA Bank offers it more than 12 million members a range of insurancebank accountsand investments.

 

Eligibility for membership is limited to individuals who are currently serving in the U.S.armed forces. Those who have retired or separated from the U.S. military with a discharge type of Honorable. Widows, widowers and un-remarried former spouses of USAA members who joined USAA prior to or during the marriage and individuals whose parents joined USAA. Cadets and midshipmen at U.S. service academies or affiliated academy preparatory schools, in advanced ROTC or on ROTC scholarship, plus officer candidates within 24 months of commissioning.

 

Accounts and other products: USAA is well known for its auto insurance, homeowners insurance, and renters insurance. USAA checking accounts have no monthly fees or minimum balance requirements. USAA also offers a range of products including savings accountscredit cardsand auto loans. You also can use Apple Pay, deposit checks from your mobile device and access USAA’s online money-management tool.

 

ATMs: Members get free access to USAA Bank-owned ATMs as well as 10 free withdrawals each month at the bank’s wider network of 65,000 USAA-preferred ATMs in the U.S. In addition, some of USAA’s checking accounts reimburse you up to $15 per month in fees for out-of-network domestic ATMs.

 

Key Points

  • Access to more than 65,000 ATMs
  • No monthly fees or balance requirements for basic accounts
  • Money Manager tool tracks spending
  • Monthly Experian FICO score and credit monitoring
  • Top APY on a basic savings account is 0.15%
  • Only four locations in the U.S.
  • Membership limited to military affiliations

Checking

  • USAA’s Classic Checking account has no monthly fee and access to more than 65,000 USAA Preferred ATM machines nationwide. In addition, the account gives a $15 monthly reimbursement for non-network ATM fees. The interest rate of APY is barely better than zero, but similar checking accounts at some other banks don’t earn any interest.

Savings

  • The USAA savings account has no monthly fee or minimum balance requirement, though you need at least $25 to open an account. Interest starts at a low 0.09% APY for balances below $1,000 and maxes out at 0.15% APY for balances of $10,000 or more.

Credit Cards

  • USAA Rewards AmEx - Earn more rewards points on your everyday purchases. 3X points on dining out; 2X points on gas and groceries; 1X points on all other purchases; 2,500 bonus points after your first purchase Variable APR Rates 11.90% - 27.90%. No AF. No Penalty APR.
  • USAA Rewards VISA Signature - Earn unlimited rewards points that never expire; 2X points on gas and groceries; 1X points on all other purchases; 2,500 bonus points after your first purchase.Variable APR Rates 11.90% - 27.90%. No AF. No Penalty APR. 
  • Cashback Rewards Plus AmEx - Earn rewards you can redeem anytime. 5% cashback on your first $3,000 in combined gas station and military base purchases yearly; 2% cashback on your first $3,000 in grocery purchases yearly; Unlimited 1% cashback on all other purchases. Variable APR Rates 13.90% - 27.90%. No AF. No Penalty APR.
  • Preferred Cash Rewards VISA Signature - Earn rewards without limits. Unlimited 1.5% cashback on all purchases; No category restrictions; Redeemable anytime. Variable APR Rates 13.90% - 27.90%. No AF. No Penalty APR.
  • USAA Rate Advantage VISA Platinum - Enjoy USAA's lowest rate card — and save. Variable APR Rates 8.90% - 25.90%. No AF. No Penalty APR.
  • New Secured Card Coming - If you need to build or rebuild your credit, USAA is working towards creating a credit card for you. 
  • USAA Military Affiliate VISA Signature - Earn unlimited rewards points that never expire; 1X points on all other purchases; 2,500 bonus points after your first purchase. Variable APR Rates 12.90% - 27.90%. No AF. No Penalty APR.
  • USAA Military Affiliate AmEx - Earn unlimited rewards points that never expire; 2X points on gas and groceries; 1X points on all other purchases; 2,500 bonus points after your first purchase. Variable APR Rates 12.90% - 27.90%. No AF. No Penalty APR.

Certificates of Deposit

  • USAA has broad Certificate of Deposit options with fixed terms ranging from 30 days to seven years. Other banks offer terms up to only five years. The rates are decent but not necessarily top of the line. For example, a one-year certificate earns 2.06% APY, and a five-year CD earns 2.78%  

Bank Experience

  • USAA has minimal branch access, so it is best for those who prefer to do their banking online. You can use the bank’s mobile app to pay bills, deposit checks, transfer money and monitor your balances. USAA also has a Money Manager tool that categorizes your transactions from the bank and external accounts to help you track your spending. In addition, the bank’s website offers budgeting tools and a financial advice section. You can reach customer service representatives by phone, chat, Twitter, online message, fax, email, and regular mail.

Overdraft Fees

  • Most fees at this bank are low, but overdrafts can add up. Members can be charged up to two $25 overdraft fees per day. For returned items, such as bounced checks, the non-sufficient fund's fee is $29, and there is no daily cap. USAA offers free overdraft transfers from a USAA checking or savings account as a backup, though transfers from the savings account are limited to six per month. It also offers overdraft protection via credit card cash advance, subject to card fees and interest rates.

USAA Debt Forgiveness - Getting off the "Blacklist" thanks @vV35Hszm


















Your FICO credit scores are not just numbers, it’s a skill.

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Valued Contributor

Pentagon Federal Credit Union (PenFed)

PenFed.png

Pentagon Federal Credit Union, commonly referred to as PenFed, was established in 1935 and today is the nation’s second-largest federal credit union. PenFed is one of the country’s strongest and most stable financial institutions serving 1.7 million members worldwide with an impressive network of ATMs. It’s online savings also has a stellar rate.

 

Eligibility for membership has been traditionally limited to members of the U.S. military or uniformed services; employees of the U.S. government; individuals related to someone who meets the previous criteria; join the National Military Family Organization for $17. I have recently seen reports that PenFed now has open enrollment, no eligibility required as of May 2019. But PenFed requires a hard inquire of your credit report immediately when you open a checking or savings account.

 

Accounts: PenFed checking and savings accounts have consumer-friendly terms. The rate on its premium online savings account is a stellar 1.80% APY. Its checking account has an APY starting at 0.20% for balances below $20,000. The regular savings account earns only 0.05% APY but has a minimum deposit of just $5.

 

ATMs and branches: PenFed offers free access to over 68,000 ATMs through the Allpoint and Co-op networks, some of the largest fee-free ATM networks in the U.S. But to visit a branch, you need to be in the Washington, D.C., area or near select military bases in the U.S. and abroad.

 

Key Points

  • Checking account earns interest
  • Members have access to 68,000 free ATMs
  • 1.80% APY on its online savings account
  • Offers true Personal Line of Credit (PLOC) - thanks BearsCubsOtters
  • Quarterly, SP approvals for credit possible - thanks BearsCubsOtters
  • Unsecured personal loan rates as low as 6.49%  - thanks BearsCubsOtters
  • Hard inquiry for membership
  • 0.05% APY on its basic savings account
  • $1,000 minimum on share certificates 
  • Doesn't participate in shared branching
  • $30 nonsufficient funds fee

Checking

  • Access America, with no monthly fee with daily balance or monthly direct deposit of $500 or more is PenFed’s lone checking option. Checking has tiered interest rates that are better than the national average, though you can find higher rates elsewhere, particularly at top online banks. With daily balances under $20,000, you can earn an annual percentage yield of 0.20%; deposits of $20,000 to $50,000 earn 0.50%. Its network of ATMs is larger than that of many financial institutions.

Savings

  • PenFed offers a Premium Online High-Yield Savings account with an impressive 2.00% annual percentage yield for balances up to $100,000. The basic savings offers a measly 0.05% APY as well as the ability to withdraw money at ATMs, which the online account does not. Both accounts have no monthly fees and require only $5 to open.

Credit Cards

  • PenFed Pathfinder Rewards AmEx - Earn more everywhere you go. 3x points on all travel purchases; 4x points on all travel purchases for PenFed Honors Advantage Members; 25,000 bonus points by spending $2,500 within 90 days of opening an account; $100 Annual Air Travel Credit for baggage fees, lounge access and onboard food and beverages; $100 Application Fee Credit for Global Entry or $85 for TSA Precheck when fee is charged to your Pathfinder Card; 0% Promo APR on balance transfers for 12 months. 3% balance transfer fee. Variable APR rates 12.99% to 17.99%. No AF.
  • PenFed Power Cash Rewards VISA Signature - Cash Back on Everything. Everywhere. 1.5% Cash Back on all purchases, or 2% Cash Back on all purchases for PenFed Honors Advantage Members; $100 Statement Credit when you spend $1,500 in the first 90 days. 0% Promo APR on balance transfers for 12 months. 3% balance transfer fee. Variable APR rates 11.99% to 17.99%. No AF.
  • PenFed Platinum Rewards VISA Signature - Get Rewards on Everyday Purchases. 5x points on gas purchases paid at the pump; 3x points at the supermarket; 1x points on all other purchases; $100 Statement Credit when you spend $1,500 in the first 90 days. 0% Promo APR on balance transfers for 12 months. 3% balance transfer fee. Variable APR rates 11.99% to 17.99%. No AF.
  • PenFed Gold VISA - PenFed’s Lowest Rate Card. $100 Statement Credit when you spend $1,500 in the first 90 days. APR for purchases and cash advances 8.99% to 17.99%. 0% Promo APR on balance transfers for 12 months. 3% balance transfer fee. No AF. No FTFs
  • PenFed Promise VISA - Absolutely No Fees. APR for purchases and cash advances from 11.99% to 17.99%. 4.99% Promo APR on balance transfers for 12 months. No AF. No FTFs.

Money Market Certificates

  • Money market certificates, PenFed’s version of a certificate of deposit, earn competitive APYs, up to 2.50%. They function like standard share certificates, the term used by most credit unions.

Member Experience

  • Though many members of the credit union are military personnel or family, you can also apply to become a member if you work for certain government agencies or for another qualifying organization, among other options. Donating a one-time fee of $17 to a nonprofit group, National Military Family Organization, that support service members and their families also make you eligible to apply. 
  • The credit union's iOS and Android mobile apps get solid ratings from users, and customer phone support is available into the evening hours and on weekends.

Overdraft Fees

  • PenFed charges a $30 nonsufficient funds fee when you don’t have enough money in your account to cover a transaction. Unlike some other financial institutions, PenFed doesn’t have an overdraft transfer service or a daily limit on how many times it will charge the fee. Members can sign up for an overdraft line of credit that comes with a 17.99% annual percentage rate and no fee.

















Your FICO credit scores are not just numbers, it’s a skill.

Message 4 of 41
Valued Contributor

Re: Best of the Best

Best of the Best

NFCU vs USAA vs PenFed

 

 

September 2, 2019

NFCU

USAA

PenFed

Credit Report Inquiries for Membership

Soft Inquiry 

? Data Points Appreciated

Hard Inquiry

No Fee Checking

Free EveryDay Checking

All Account Types

With daily balance or monthly direct deposit of $500 or more

Free Checks

Yes - Free name only checks and free standard shipping

Yes - Free check designs come with free order tracking.

Yes - Free Box of Checks

Interest Bearing Checking

Flagship Checking earns

0.35% to 0.45% APY

Classic Checking earns 0.01 % APY interest on balances of $1000 or more.

Checking earns 0.20% APY with daily balance or monthly DD of $500 or more

Savings Interest Rate

Share Savings Account

0.25% APY

$10,000 earns 0.15% APY

Premium online savings account earns 1.80% APY

No Fee Credit Card

Platinum Visa 

None Available

PenFed Promise VISA

Low APR Credit Card

Platinum Visa

8.24% - 18.00% 

Variable APR

Rate Advantage Visa

8.90% to 25.90% 

Variable APR

PenFed Gold VISA 9.24% to 17.99% Variable APR

Sept 03, 2019

NFCU

USAA

PenFed

0% BT card

NFCU Platinum Visa - 0% introductory APR for 12 months - NO balance transfer fee

By Invitation  (Thanks jaxstraw)

PenFed Promise Visa - 0% promotional APR balance transfer rate for 12 months - NO balance transfer fee

Secured Credit Card

nRewards Secured Mastercard

Not Currently Available

None Available

No Foreign Transaction Fees

All CCs with no FTFs

All CCs with no FTFs

PenFed Gold VISA Penfed Promise VISA

Lowest % New Auto Loan

Up to 36 mos. APR as low as 2.99%

Up to 36 mos. APR as low as 2.89%

Up to 36 mos. APR as low as 2.49%

Lowest % Used Auto Loan

Up to 36 mos. APR as low as 3.99%

Up to 36 mos. APR as low as 3.24%

Up to 36 mos. APR as low as 3.49%

Mortgages

30-Year Conventional Loan 3.375% APR

30-Year Conventional Loan 3.649% APR

30-Year Conventional Loan 3.601% APR

Free FICO Score

Equifax FICO 9

Experian FICO 8

Equifax FICO 9

Experian Credit Boost

Not Supported

? Data Points Appreciated

? Data Points Appreciated

Free Credit Monitoring

None

Experian Credit Monitoring and Credit Report

None

Early CD withdrawal penalty

Forfeiture of some interest earned 

Forfeiture of some interest earned

Up to 30% of the gross amount of dividends that would have been earned if the certificate had reache...




















Your FICO credit scores are not just numbers, it’s a skill.

Message 5 of 41
Valued Contributor

Re: NFCU vs USAA vs PenFed

Future Edit


















Your FICO credit scores are not just numbers, it’s a skill.

Message 6 of 41
Contributor

Re: NFCU vs USAA vs PenFed

Fantastic Topic...thanks @Medic981

Starting score 6/19 TR 567 Ex 589 EQ 540
7/19 TR 620 EX 595 EQ 577
8/19 TR 643 EQ 614 EX 612
Goal: 680 by 12/19
Message 7 of 41
Frequent Contributor

Re: Pentagon Federal Credit Union (PenFed)


@Medic981 wrote:

 

Pentagon Federal Credit Union (PenFed)

 

  •  

Money Market Certificates

  • Money market certificates, PenFed’s version of a certificate of deposit, earn competitive APYs, up to 2.50%. They function like standard share certificates, the term used by most credit unions.

Keep in mind that breaking PenFed Certificate requires you to write a letter to the credit union. It can't be done online. Furthermore the lengauge is not very straight forward. But it looks like if you break a 1 year CD prior to 1 year then you loose all dividents. If you break a 2 year CD, you loose entire 1 year of dividents plus 30% of total dividents you would have earned.

 

I would avoid their CDs unless you are 100% sure that you will not withdraw your principle.

 

I copy and pasted their terms below. It would be nice if you compared these terms to those of USAA and Navy. I don't have the latter.

 

All requests for early withdrawal must be in writing. In the event of early withdrawal, one of the following penalties shall apply: 1) Six-month Money Market Certificates. a) If redeemed within 90 days of the issue date or any renewal date, all dividends will be forfeited. b) If redeemed thereafter, but prior to the maturity date, dividends for 90 days will be forfeited. 2) Certificates Having a Term Greater Than Six Months. a) If redeemed within the first year, all dividends will be forfeited. b) If redeemed thereafter, but prior to the maturity date, the early withdrawal penalty will equal 30% of what would have been earned if the certificate had been held to maturity, not to exceed total dividends earned 3) Exceptions. The penalties described above will not be applied if the redemption is made: a) Subsequent to the death of any holder of the certificate; b) As a result of the voluntary or involuntary liquidation of the credit union.

 

 

Message 8 of 41
Valued Contributor

Re: Pentagon Federal Credit Union (PenFed)


@Green456 wrote:

@Medic981 wrote:

 

Pentagon Federal Credit Union (PenFed)

 

Money Market Certificates

  • Money market certificates, PenFed’s version of a certificate of deposit, earn competitive APYs, up to 2.50%. They function like standard share certificates, the term used by most credit unions.

I would avoid their CDs unless you are 100% sure that you will not withdraw your principle.

As with most, if not all financial institutions, the earlier you withdraw money from your CD, the less interest you’ll earn. And in most cases, you’ll also have to pay some sort of penalty. I would avoid ANY CD or Share Certificates unless you are 100% sure that you will not need to withdraw your principle.

 

My Emergency Fund is 100% funded (6 months of expenses) in a PenFed Premium Online Savings Account earning 1.80%. My excess funds are in an NFCU share certificate. I am getting a great rate of 3.50% APY on that money. If my Emergency Fund runs dry, then and only then would I withdraw money from this share certificate. 


















Your FICO credit scores are not just numbers, it’s a skill.

Message 9 of 41

Re: NFCU vs USAA vs PenFed

Great information! Thank you for taking the time to piece this together. I would like to add my $0.02:

 

USAA: 

You list as a con that USAA is restricted to individuals with military affliliation. I feel this is a Pro! NFCU has become the town bicycle ever since they opened the floodgate to membership in 2017. It seems most people my age and older either served or had a grandfather or father (or grandmother/mother) that served in WWII, Korea or Vietnam and now even Desert Storm; thereby making a large segment of the population eligible for membership. I'd like to see NFCU require that one without personal military experience join through an exisitng member that does have military connection. i.e. dad served-great, he can join NFCU and then you join through him. But I digress. Basic point, I like that USAA is not open to all and I find that to be a pro. 

 

PenFed:

There are more cons than pros in your assessment. I have to agree that of the three, they are my least favorite; however, I think they are deserving of the following Pro's:

-The only one of the three to offer a true, easily accessed, Personal Line of Credit (PLOC) NFCU's is a CLOC and USAA doesn't offer one.

-For many but not all members-quarterly, SP approvals for credit (YMMV-hello Turbo Tax!)

-Offers the best unsecured personal loan rates of the three, provided the member has excellent credit at 6.49%

 

And finally,

NFCU:

-You list the regular share (savings) rate of 0.25% to be a con. If we compare apples to apples, NFCU's regular, share (savings) rate is quite high. Most banks and credit unions are well under 0.15%. If one wants a higher rate than they should open an online savings account or open a CD. Therefore, I would consider NFCU's regular, share (savings) rate to be a Pro or at least should not be listed as a con. 

 

Please take my suggestions as just my thoughts and not a criticism of the hard work you have put forth here. 

Message 10 of 41
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