This thread is now over two and one half years old. I’m that much older, too, and I realize better now than back then that I could be out of touch. Specifically, persons running credit unions today are all MUCH younger than myself. Perhaps my thinking right along about some stuff has been in error. And that “stuff” is germane to this thread.
This has always been about a form of MS (manufactured spending), doable from home with no travel involved, which involves CD purchases with a credit card. Here is what I was thinking at the outset, two and one half years ago:
Purchases of short term CDs with members’ credit cards is not profitable for a credit union because CU must pay interchange fees to the CC company. This is true even if the CU pays a very low rate of interest on these CD accounts.
Hey, live and learn, right? Apparently the above is increasingly being seen as erroneous by today’s CU managements. Please do not look to me for an explanation. I have none.
What I do have, in marked contrast to the situation when this thread commenced, is a surfeit of counterparties willing to let you open certificates with a credit card . . . . with more appearing all the time. So in the spirit of “sharing is caring”, here are several names for anyone who might be interested:
Sun East FCU
Justice FCU
Merck Sharp and Dohme FCU
Anyone is permitted to join those credit unions. All offer three month CDs which can net you between 6% and 12% APY on your CD investments, tax free. My own returns run between 6% and 24% APY, tax free, but average right around eight to ten percent. Note there is, in addition, a tiny taxable component to your returns, but I mostly just ignore that because it is so small.
Anyway, more and more of these opportunities are surfacing all the time. I do not understand why. But given the very low CD interest rate environment currently existing, I worry less about understanding and more about simply cashing in.