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where to park some money?
Old 11-02-2018, 06:45 AM   #1
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where to park some money?

I have a sizable cd coming due the first of december. I was considering parking this money in a savings or 12 month cd. I think the cd rates are going to climb for a while, but don't know how long to wait before getting a long term cd. my question is what would you do with it? use short term cd, use the no penalty for withdrawal cd, high yield savings, or just go with todays long term 5 year rates? do you think the cd rates will increase another point in the next twelve months or stay flat? thanks

frank
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Old 11-02-2018, 06:52 AM   #2
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VMMXX.... liquid, safe and currently pays 2.2%

https://investor.vanguard.com/mutual.../profile/VMMXX

I'm doing the same thing... parked in VMMXX waiting for CD rates to increase.
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Old 11-02-2018, 08:06 AM   #3
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The yield curve sort of flattens out after two years so I am moving mostly to brokered CDs at around the two year mark. Bought some yesterday ~3.05%
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Old 11-02-2018, 08:18 AM   #4
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Ditto on VMMXX. Good yield @ ~2.2%. Not FDIC insured, but has never "broken the buck" (far as I know).

I'm in the same boat as you - have some CDs maturing and am expecting rates to inch up slightly (.1 - .25) after the next Fed raise in Dec. 2-yr brokered CDs @ 3.05 look to be the sweet spot at this point - decent yield but not locking in "too" long. I'm personally not going out beyond 2 year maturity at this point as we have at least 1 and as many as 5 rate increases coming over the next 13 months..I did buy some 3-yr earlier this year and am now regretting as I have one at 2.8%. Oh well..
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Old 11-02-2018, 08:32 AM   #5
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Perfect timing - was wondering where to stash a slug of EE Bonds that matured yesterday. Thanks for excellent advice!
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Old 11-02-2018, 08:34 AM   #6
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Ally Bank has a 2.1% no penalty CD for 11 months. If the rates go up in the near future, they'll increase the rate. No new deposits to it allowed, but there is no penalty for withdrawals.
They did have a $1,000 bonus for new customers bringing in substantial deposits, but it expired. Ally seems to often to have sales promos going on.
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Old 11-02-2018, 08:58 AM   #7
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T Bills/Treasury MMF maybe better if you have high state tax like NY, Ca.
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Old 11-02-2018, 09:04 AM   #8
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Ditto on VMMXX. Good yield @ ~2.2%. Not FDIC insured, but has never "broken the buck" (far as I know).

I'm in the same boat as you - have some CDs maturing and am expecting rates to inch up slightly (.1 - .25) after the next Fed raise in Dec. 2-yr brokered CDs @ 3.05 look to be the sweet spot at this point - decent yield but not locking in "too" long. I'm personally not going out beyond 2 year maturity at this point as we have at least 1 and as many as 5 rate increases coming over the next 13 months..I did buy some 3-yr earlier this year and am now regretting as I have one at 2.8%. Oh well..
Not to one up you, RetireSoon, but I have a 4-year CD that matures in 2020 with an APY of...1.98%. If only I could yell at my younger, dumber self!
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Old 11-02-2018, 09:29 AM   #9
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T Bills/Treasury MMF maybe better if you have high state tax like NY, Ca.
Yes; if subject to state tax, treasury notes are competitive with CDs and don't have all the liquidity fuss that CDs have. Once you get a sizeable amount, there is almost no substitute for treasuries.
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where to park some money?
Old 11-02-2018, 10:44 AM   #10
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where to park some money?

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where to park some money?
Old 11-02-2018, 10:49 AM   #11
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where to park some money?

Quote:
Originally Posted by TDub View Post
Not to one up you, RetireSoon, but I have a 4-year CD that matures in 2020 with an APY of...1.98%. If only I could yell at my younger, dumber self!


Why donít you sell it. I just cashed in a CD with only 8 months left to maturity. I use the early withdrawal penalty calculator on deposit accounts.com to assess the penalty.
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2.15% apy
Old 11-02-2018, 10:58 AM   #12
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2.15% apy

Here are two FDIC options....

CIT Bank 2.15% money market (called "savings builder") &
Goldman Sachs Bank aka Marcus 2.15% 13 month no penalty CD
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Old 11-02-2018, 12:21 PM   #13
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Originally Posted by pb4uski View Post
VMMXX.... liquid, safe and currently pays 2.2%

https://investor.vanguard.com/mutual.../profile/VMMXX

I'm doing the same thing... parked in VMMXX waiting for CD rates to increase.
I just put some money in VMMXX. Nice to see some return there where there was none. A few years ago I took all my cash out of VMMXX and opened an Ally account paying 1% when VMMXX was essentially zero. Now they’re comparable returns.
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Old 11-02-2018, 02:09 PM   #14
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all good ideas. I have about 30 days before my cd matures. maybe something better will show up by then, otherwise the no penalty cd's look pretty good.
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Old 11-02-2018, 02:20 PM   #15
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Originally Posted by pb4uski View Post
VMMXX.... liquid, safe and currently pays 2.2%

https://investor.vanguard.com/mutual.../profile/VMMXX

I'm doing the same thing... parked in VMMXX waiting for CD rates to increase.

Tritto on VMMXX. That's my bucket for 'down' years.
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Old 11-02-2018, 06:27 PM   #16
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Another +1 for VMMXX.

Iím in the process of moving all my high yields savings back to this fund.
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Old 11-03-2018, 04:18 AM   #17
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The yield curve sort of flattens out after two years so I am moving mostly to brokered CDs at around the two year mark. Bought some yesterday ~3.05%
Yeah, IMO, the sweet spot on CD's is 2-3 years. Not enough bonus to go 5 or more.

Park your cash with Ally and check out their no penalty CD.
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Old 11-03-2018, 07:30 AM   #18
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If you plan on putting the money in a CD at some point, just buy a 2-3 year CD now. Nobody knows if CD rates will be higher in 6-12 months or lower.
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Old 11-03-2018, 08:23 AM   #19
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I have a whopper (Post Tax i.e. Cash) CD maturing in December from PenFED. Trying to decide what I want to do. 1 year at the highest I can get, 3 year MYGA (Tax Deferred) or just MM for now.
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Old 11-03-2018, 12:05 PM   #20
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I just purchased some 6 month zero coupon Treasuries yielding 2.49% on Fidelity's website (no State tax). It doesn't make sense to buy 12 month CDs unless it paid close to 3% or 18 month CDs unless it was paying over 3.25%. IMHO.
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