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Old 09-03-2008, 10:03 AM   #21
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FDIC insurance limits: This is a little off topic here, but I was wondering if I understand something I found out yesterday correctly. Yesterday I was told at a bank that if I set up my accounts with multiple POD's (payable on death beneficiaries), that I would have more than $100,000 FDIC insurance coverage. For example, if I set up my accounts at a bank with my mother and 2 sisters as POD's, I would have $300,000 FDIC insurance coverage (instead of $100,000). This was news to me and from now on I plan on putting more than one POD on all my new accounts. Is anyone here familiar with this FDIC law/rule and am I understanding it correctly?

I actually have more than $100,000 at Key Bank, so this will put my mind at ease once I get the POD designations changed on my accounts.
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Old 09-03-2008, 10:07 AM   #22
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DallasGuy, this FDIC website should help answer your question: FDIC: Electronic Deposit Insurance Estimator (EDIE) Online Version
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Old 09-04-2008, 12:10 AM   #23
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Been buying Cd's for many, many ,years now. As mentioned earlier, "bankdeals.blogspot.com" is an excellent site. Much better than BankRate.com. IMHO.

In the past I purchased CD's at Vanguard. I noticed the CD rates were in general 1/2% less yield when compared to buying the CD's directly from the bank/credit union. That is why I quite using Vanguard for CD's.

I figure the rates were lower at Vanguard because the issuing institution had to pay Vanguard a fee. (Since Vanguard charges no fees for new issue CD's).

Lately, I've found I've received the best rates at CREDIT UNIONS! Also, a local credit union use match other institutions rates up to 1% over their existing rates. You have to ASK ABOUT MATCHING RATES.
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Old 09-04-2008, 02:48 AM   #24
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Wolf

I thought of doing something similar but isn't it a pain to be buying cd's from a bunch of different places having to set up the accounts and all that rather than going with one brokerage?

Jim
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Old 09-04-2008, 03:28 AM   #25
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Wolf

I thought of doing something similar but isn't it a pain to be buying cd's from a bunch of different places having to set up the accounts and all that rather than going with one brokerage?

Jim
Jim.....

Go to the Schwab site and look at available CD rates. Then compare to the rates you could get by opening accounts at assorted banks and credit unions (those named to have the highest rates by the rating sites mentioned earlier). If the difference is worth it, say one half percent or so, open the separate accounts. If not, don't.

When I did this, I found that there were some shorter term (one year) rates available in my area that beat the brokered CD's available at Schwab. They required a branch visit and were obviously leaders designed to attract new money to the bank. But they are in the Chicago area where I live and worth the effort as long as the CD amount will be large. I didn't see anything available that beat the offered brokered CD's for longer term (five years) CD's.

See what you find.
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Old 09-06-2008, 02:34 PM   #26
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Yes, I agree, it can be a pain to shop around, rather than use Schwabb,Vanguard, etc. I think it depends on the amount of money you are working with. If you have a relatively small amount it probably is not worth "shopping" around. However, in my case, a small percentage difference in return, does result in a fairly large dollar amount.

One example, I'm sure many of you are aware, Pentagon Federal Credit Union (open to all), offered 5-7yr, 6.25%, CD's about a year ago. It took a little effort to open these accounts, but the returns are well worth it. So, shopping around takes effort, but in doing so, you can get above average returns.
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Old 09-06-2008, 02:55 PM   #27
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Originally Posted by DallasGuy View Post
FDIC insurance limits: This is a little off topic here, but I was wondering if I understand something I found out yesterday correctly. Yesterday I was told at a bank that if I set up my accounts with multiple POD's (payable on death beneficiaries), that I would have more than $100,000 FDIC insurance coverage. For example, if I set up my accounts at a bank with my mother and 2 sisters as POD's, I would have $300,000 FDIC insurance coverage (instead of $100,000). This was news to me and from now on I plan on putting more than one POD on all my new accounts. Is anyone here familiar with this FDIC law/rule and am I understanding it correctly?

I actually have more than $100,000 at Key Bank, so this will put my mind at ease once I get the POD designations changed on my accounts.
Go here FDIC: Federal Deposit Insurance Corporation and use the calculator (direct link to calculator FDIC: Account Fully Insured) to determine coverage. You can get it up to $400K for two people (and $800K for three) if done correctly.
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Old 09-06-2008, 08:29 PM   #28
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https://www.moneyaisle.com/
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Old 09-07-2008, 05:44 AM   #29
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Tried to do the non registered version of the test drive on the moneyaisle site and wouldn't work this morning, interesting idea?
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Old 09-07-2008, 10:11 AM   #30
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That was kinda ebay style fun:
  • Live Bank CD Auction: Test-Drive
  • Pick your product
  • Watch banks bid, live
  • Get a great rate
And the highest
offer is...



4.34%APY









Which is under the 5% offered by WAMU and reported by bankdeals.blogspot.com for the same amount and term.
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Old 09-07-2008, 03:31 PM   #31
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Calmloki,
The WAMU offer ended last Friday, 8/29. The rate above is very good, for 13 months.

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Old 09-07-2008, 04:54 PM   #32
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Hmm, I just did the Wamu 12 months at 5% online.
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Old 09-07-2008, 09:02 PM   #33
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Hmm, I just did the Wamu 12 months at 5% online.
Yep, just checked Wamu's site....4.89% interest rate with a 5.0% APY for 12 & 13 month online CD's. That ain't too shabby at all! Hope they have that rate (or better) when I have some spare change to get another CD.
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Old 09-07-2008, 09:12 PM   #34
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Calmloki,
The WAMU offer ended last Friday, 8/29. The rate above is very good, for 13 months.

-- Rita
I'm not much for research, but this guy (gal?) seems pretty on the ball - notice it was claimed as a 1 week only rate, so.... like the earlier poster said; bankdeals.blogspot.com
Think it's updated every Saturday.
Works for me (he says, with money mouldering at 3.7 with CapOne savings, cause surely the rates are going to bounce up higher pretty quick, no? Yes? I hope!).
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Old 09-08-2008, 09:17 AM   #35
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Right now you can buy a four month WAMU cp. bond paying 24.75%. If you're willing to buy a CD, you may as well consider the corporate bond. JMO
BTW, if you're not willing to buy the corp. bond, perhaps you should be reconsidering whether or not you feel comfortable with their CD's. Just a thought.
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Old 09-08-2008, 09:37 AM   #36
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FDIC vs no FDIC.
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Old 09-08-2008, 10:12 AM   #37
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I'm not much for research, but this guy (gal?) seems pretty on the ball - notice it was claimed as a 1 week only rate, so.... like the earlier poster said; bankdeals.blogspot.com
Think it's updated every Saturday.
Works for me (he says, with money mouldering at 3.7 with CapOne savings, cause surely the rates are going to bounce up higher pretty quick, no? Yes? I hope!).
Calmloki:
It helps to live near the bank and happen to be there to buy the CD at the 5% rate. Comment from the Customer Service Rep was that it was only good until the end of August. Comment from one CSR to the other - "we lost $10M last month."

However, block ad in today's Seattle Times shows the rate is now back on for 13 month CD's. So, must have just been on vacation for the week.

In other news, WAMU's CEO Kerry Killinger was terminated over the weekend (see the $10M comment above).

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Old 09-08-2008, 10:35 AM   #38
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FDIC vs no FDIC.
Doesn't matter. Would you actually buy a 1 year CD knowing FDIC may have to step in to pay them off? You'd be losing interest, AND waiting to get paid back. So, if you think WAMU lasts a year, why not buy their bonds paying a ton more income for a much shorter period?
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Old 09-08-2008, 11:43 AM   #39
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Buying a CD vs. buying the equivalent of a junk bond from an extremely distressed company is essentially what it comes down to. It is simply a matter of risk vs. reward.

The CD has essentially no risk, you risk possibly losing a weeks worth of interest. You only get 5% over the course of the year for a return as a result. For comparison's sake, this would be a return of 1.66% over 4 months.

The corp bond has extremely high risk, you risk losing all your principle, what exactly that risk level is, who knows, but is in the very high range based on current market information. So, you get a 24.5% return over 4 months (if that is right).

So, is a huge amount of risk worth an increased return of about 22.85% over 4 months? Essentially, do you think there is a less than 22.85% chance the company will go under in 4 months? Who knows, it depends on your risk tolerance and if you know something the rest of the market doesn't, which currently believes there is a 22.85% chance of the equivalent of a total loss in the next 4 months.
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Old 09-08-2008, 11:56 AM   #40
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Someone has a fundamental disconnect on the various levels of risk associated with different investment products........

The good news is that I now have seen the second worst piece of investment advice ever. This easily replaces that comment about mutual funds all having about the same level of risk and theres no need to read the prospectus, since they all say the same thing...
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