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Old 05-19-2010, 05:42 AM   #21
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Originally Posted by inquisitive View Post
So I think I'm going to go with the Wells Fargo PMA deal. Does anyone know if the $25,000 includes Roth IRA investments? If I transfer that I will be over the limit.
Yes, your Roth IRA counts toward the $25K requirement.

If I have my paycheck go automatically into some kind of investment, can I write checks on this account and have it sell whatever I'm invested in, or do I need to sell the investment and then write checks? I've realized that I always have a few thousand that is sitting and either making nothing in a checking account or a small amount in a savings account. Would like to put this toward something useful but also be able to write checks on it.
I do not think you can have your paycheck go automatically into some kind of investment. You can have your paycheck automatically direct-deposited into your WellsFargo PMA checking account. It is a full-fledged checking account, so you can write all the checks you want. Paper checks are free. It is not an investment account.

You can transfer money from checking to your WellsTrade brokerage account online. You may be able to contact WellsTrade and get a form to fill out to do automatic investing into a mutual fund like a Vanguard short-term bond fund. The transfers would then happen automatically. I doubt you could then write checks on the bond fund.

However, you could still do WellsFargo PMA (or any other bank checking account), you could then open yet another account at Vanguard. You could have Vanguard pull money from your checking account automatically and use it to invest in a short-term bond fund. Vanguard has check-writing on many of its short-term bond funds.

For myself, I am at the stage where I do not want anything but my 401(k) contributions to happen automatically. I want control and do transfers manually when I want to. I keep about 2 weeks worth of expenses in my checking account and the rest I manually transfer elsewhere to invest.

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Old 05-19-2010, 07:50 AM   #22
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WellsFargo PMA can do automatic checkwriting (scheduled) to anywhere, including Vanguard funds and WellsTrade brokerage. I don't know anyone who does checkwriting that automatically liquidates investments to cover the check. That sounds a little dangerous to me since if you need that money why would you be taking investment risks with it. Personally, if I was going to do anything like that, I'd like to be in the loop and make she investment sale manually to know what was going on. Would be interested to hear if you ever find an account like this. If you are thinking of going with PMA for free trades in the brokerage, you might want to look again as Vanguard brokerage, as they just dropped their fees and now have some free trades also.

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Old 05-19-2010, 08:51 AM   #23
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Originally Posted by DblDoc View Post
You need to re-read Nords' post above ^.

You need an emergency fund that is liquid if you need to write an occassional check you have not budgeted for. I use a "high yield" checking account at ING which is paying 0.25% right now . But it is safe and liquid. Run a tight budget and then invest what you have left over. I would never "automatically" invest in something that I may have to sell on a whim in the near term. That is not investing. That is gambling.

Why not go with their saving account I can easily move money to my checking account if I need it. It also is paying around 1%... (made me look... it is 1.1%)...
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Old 05-19-2010, 08:58 AM   #24
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I always used my local bank (BofA and its predecessors) as a hub for my banking activities. This included electronic bill paying, ATM withdrawals, direct deposit of my paychecks (when I was working) and other electronic payments, and electronic purchases of mutual fund shares in my investments. But it also included other things which required an in-person bank teller such as the rare bank check, rare cash deposits, and getting quarters for the laundry. I would also deposit paper checks there, sometimes at the ATM, sometimes with a teller. The bank is walking distance from where I live and had branches/ATMs near my old office.

I would keep enough money in the account to satisfy minimum balance requirements plus a cushion of $500-$750 in case there was some unexpected expense I needed to write a check or get cash for. Furthermore, some of my mutual funds have checkwriting so they provide an extra level of quick access in case I need to write a rare, large check (at least $500 or $1,000) right away instead of doing an electronic redemption and waiting a few days.

Until the late 1990s, I had a MM savings account which I used for the minimum balance+cushion, effectively giving me a small interest amount on my checking. I had overdraft protection on the checking so I never had to worry about bouncing a check.

But in the late 1990s, the local banks had a "race to the bottom" when they starting greatly raising minimum balances and fees and forced me to either raise the amount in the MM savings (and forgoing greater dividends in the bond mutual fund I would getting the added money from) or combine it with the no-interest checking account. The latter was a better deal for me but it little more than the lesser of two inferior options.

Even though I don't work any more (retired in 2008), I still do the same things, except that my electronic paychecks have been replaced by electronic dividend payments. I still like having a local bank around as a hub for my activities.
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Old 05-19-2010, 10:04 AM   #25
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Originally Posted by Texas Proud View Post
Why not go with their saving account I can easily move money to my checking account if I need it. It also is paying around 1%... (made me look... it is 1.1%)...
Thanks for pointing that out.

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Old 05-20-2010, 11:43 AM   #26
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Citi Smith Barney FMA account comes with free checks, brokerage, Master Card or Amex and TY Network points

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