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Old 06-23-2020, 08:31 AM   #501
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Decisions.....let's see...I have an ALLY High Yield 2.85% CD maturing in late July. Renewal CD is at 1% for 12 months while their savings account interest rate sits at 1.1%. I wonder what I am going to do. LOL!
Lock in the 1%. I am amazed that is my advice. But I see the regular savings going under 1% in the not to distant future.

Note: My crystal ball is cracked, I can't read minds, and my time machine is broken. That about sums up my ability to predict interest rates, the stock markets, etc.
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Old 06-23-2020, 09:14 AM   #502
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I am moving funds into my navy add on CDs, but the whole curve for new deals there is under 1 percent now. When my existing ladder runs out, I guess I will just prepay the mortgage with the money.
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Old 06-23-2020, 09:23 AM   #503
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Yup... in 2019 and prior my AA included 2-5% cash which was earning ~2% in an online savings account so that combined with the growth of my overall 60/35/5 AA target I was very comfortable keeping my 3.375% mortgage but once online savings rates trended down and I wanted to be more defensive so I eliminated the 5% cash allocation and used that money to pay off the mortgage. Avoiding the 3.375% looks like a good decision right now since that online savings has declined to 1.15%.

I seeded a couple 1.3% 1-year Navy Federal add-on CDs in May but I'm not sure if a year is going to be long enough... in retrospect I should have seeded 1-year, 2-year and 3-year I think... but too late now.
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Old 06-23-2020, 10:18 AM   #504
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Lock in the 1%. I am amazed that is my advice. But I see the regular savings going under 1% in the not to distant future.

Note: My crystal ball is cracked, I can't read minds, and my time machine is broken. That about sums up my ability to predict interest rates, the stock markets, etc.
I doubt if I am going to lock in 1% for another year. The CD was for $25K and in taxable. I like the flexibility of having $25K available for things like a used "garage queen" Corvette (on my slimming bucket list), or for emergencies, if we have any more, haha! Seems like we have one every year.

There's a few more ~3% CDs in the pipeline coming due in the next 6 - 8 months. About 1/2 are in the IRA.

I might even drop the $25K in the Market when the next big drop hits this Fall. All I know is that at age 76, and DW almost 75, cash is King around here.

Maybe we will just give the $25K to our daughter since that's where all the goodies are headed someday.

It's great to have choices these days!
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Old 06-23-2020, 12:29 PM   #505
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I doubt if I am going to lock in 1% for another year. The CD was for $25K and in taxable. I like the flexibility of having $25K available for things like a used "garage queen" Corvette (on my slimming bucket list), or for emergencies, if we have any more, haha! Seems like we have one every year.
I see your point. And have the same concerns.

I used 11 month No-Penalty CD's from Ally bank for my emergency money. I locked in a whopping 1.3%. I split my emergency cash into four smaller lumps so I don't have to cash in the whole amount just in case I need some of the money.
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Old 06-23-2020, 12:34 PM   #506
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I see your point. And have the same concerns.

I used 11 month No-Penalty CD's from Ally bank for my emergency money. I locked in a whopping 1.3%. I split my emergency cash into four smaller lumps so I don't have to cash in the whole amount just in case I need some of the money.
I don't know about Ally, but many places allow proportional withdrawals so you only pay EWP on the amount withdrawn so there is no need for multiple CDs... so if you have $200k at 2% and the EWP is 1/2 year of interest, if you withdraw $50k then the EWP is only $500 and the other $150k goes on as it was.
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Old 06-23-2020, 12:53 PM   #507
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With rates as low as they have gotten, it makes almost no sense to lock funds in CD's. Maybe just buy treasuries or a treasury fund and sell when needed.
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Old 06-23-2020, 01:00 PM   #508
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With rates as low as they have gotten, it makes almost no sense to lock funds in CD's. Maybe just buy treasuries or a treasury fund and sell when needed.
Have you looked at Treasury yields?
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Old 06-23-2020, 01:15 PM   #509
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Have you looked at Treasury yields?
Pretty pathetic. 0.35% for the 5-year.
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Old 06-23-2020, 01:24 PM   #510
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Pretty pathetic. 0.35% for the 5-year.
Yikes!

What the H**L is going on? That 3 - 5 year MYGA is looking attractive right now.
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Old 06-23-2020, 01:25 PM   #511
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Have you looked at Treasury yields?
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Yikes!

What the H**L is going on? That 3 - 5 year MYGA is looking attractive right now.
brewer, I think you have your answer.
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Old 06-23-2020, 01:38 PM   #512
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brewer, I think you have your answer.
Wait until the rates go negative and then what will us retirees do? I'm too cautious to jump back into the Market (only 10% equities right now) and is (was) using IRA generated cash from interest and dividends to fund my RMD's. But that's pretty down the tubes going forward.

The younger crowd here is facing some daunting times if rates stay low and the market goes flat like it did in Japan.

Me (us) will probably be dead in 10 more years or have dementia and not know who we are so now worries then.
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Old 06-23-2020, 01:42 PM   #513
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Wait until the rates go negative and then what will us retirees do? I'm too cautious to jump back into the Market (only 10% equities right now) and is (was) using IRA generated cash from interest and dividends to fund my RMD's. But that's pretty down the tubes going forward.

The younger crowd here is facing some daunting times if rates stay low and the market goes flat like it did in Japan.

Me (us) will probably be dead in 10 more years or have dementia and not know who we are so now worries then.
Back to the tactical. Put the money in the 1 year CD as it is your best option.
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Old 06-23-2020, 01:45 PM   #514
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Back to the tactical. Put the money in the 1 year CD as it is your best option.
Yeah, it's probably going to go there, and the next one too. Leaving it in cash is too tempting to piss it away on a used sports car of some other form of frivolous entertainment.

I do think I am going to by a new 12 gauge and maybe a 9MM Luger soon. I just heard that a widow nearby just bought a .380 and is getting here CC license. I need to stay up with the "Joneses" around here. (LOL)
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Old 06-23-2020, 01:49 PM   #515
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Me (us) will probably be dead in 10 more years or have dementia and not know who we are so now worries then.
Jeeeze Louise. Just because it is true doesn't mean we (us) need to see it posted as a reminder.
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Old 06-23-2020, 01:59 PM   #516
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I do think I am going to by a new 12 gauge and maybe a 9MM Luger soon. I just heard that a widow nearby just bought a .380 and is getting here CC license. I need to stay up with the "Joneses" around here. (LOL)
Good luck. Everything appears to be sold out.
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Old 06-23-2020, 02:08 PM   #517
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Good luck. Everything appears to be sold out.
Yes, I ran into that already.
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Old 06-23-2020, 02:09 PM   #518
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Jeeeze Louise. Just because it is true doesn't mean we (us) need to see it posted as a reminder.
I really meant DW and I, not you old Farts here too. But...
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Old 06-23-2020, 03:45 PM   #519
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Yeah, it's probably going to go there, and the next one too. Leaving it in cash is too tempting to piss it away on a used sports car of some other form of frivolous entertainment.
Reconsider - your prior post was exactly my thoughts. When the interest rates are so low, locking in to 1% for 1 year is not worth it in my mind. The amount you are sacrificing compared to if the cash was in a simple savings account is negligible. However, as you rightly point out, it gives you flexibility. I am confident you can keep yourself from being frivolous with the money, and look to it as more of an investment opportunity waiting to happen.
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Old 06-23-2020, 04:02 PM   #520
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I am sure this post will jinx it, but viobank is still at 1.35% for the high yield savings.
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