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Old 04-08-2022, 08:01 PM   #181
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That is easy, I never knew this existed but I only have owned mutual funds. My bond funds are getting killed with rising rates and they are short term funds, maybe buying a 1 year T bill makes sense and the yields are far better than a CD. I assume you can do this in a roll over IRA?
Sure. You can do it in any account I would think. You can get at least 2% in the 12-18 month range now.
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Old 04-09-2022, 05:14 AM   #182
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This article has screen shots of how to buy new issue Treasuries at auction through Fidelity, Schwab and Vanguard.

https://thefinancebuff.com/treasury-...ey-market.html

Treasuries can also be bought on the secondary market if you don't want to wait until the auction date.
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Old 04-09-2022, 06:25 AM   #183
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MYGAs are creeping up. 3.3% 5 year currently. We still are lucky to have some 4% CDs for a couple of years. At 70 I think we will move to MYGAs when they get above 4% and ladder 6 or so at the state's guarantee fund limits. Each contract is covered to the state limits, maybe not FDIC, but it is something. A- and A+ companies seem to be stepping up their rates.
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Old 04-09-2022, 07:07 AM   #184
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This article has screen shots of how to buy new issue Treasuries at auction through Fidelity, Schwab and Vanguard.

https://thefinancebuff.com/treasury-...ey-market.html

Treasuries can also be bought on the secondary market if you don't want to wait until the auction date.
What is the advantage of buying new issues vs buying on the secondary market?
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Old 04-09-2022, 06:32 PM   #185
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I’m guessing here, but you are not paying any fees when you buy at the auction. With rates trending up you are more likely to get slightly better rates. Buying in the secondary market is a bid/ask transaction. There is a seller and dealer that wanna get paid.

Also you will see tiny price breaks for buying higher volume of bonds and sellers can stipulate a minimum purchase. The auction minimum is 1 bond ($1000).
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Old 04-09-2022, 07:12 PM   #186
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This article has screen shots of how to buy new issue Treasuries at auction through Fidelity, Schwab and Vanguard.

https://thefinancebuff.com/treasury-...ey-market.html

Treasuries can also be bought on the secondary market if you don't want to wait until the auction date.
I read that earlier today as I follow his blog. I bookmarked it along with links to the tentative auction schedule and Vanguard's Bond section where I can see what treasury bills are for sale.

I went to Vanguard and ran a purchase simulation and cancelled at the point of actually buying just to see what is involved. It is surprisingly simple! The only negative is Vanguard, unlike Fido and Schwab, doesn't have a roll over option to repurchase upon maturity.

I liked the secondary market cuz I could buy a T bill that matured in mid August with a coupon that is more than half of a 1 year bill for just 4 months. If you can do that say 2 or 3 times a year the rate looks like it is quite a bit more than buying a 1 year bill unless I am misunderstanding what I saw, this is new stuff to me. But as mentioned, you pay a bit more on the secondary market.
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Old 04-09-2022, 07:17 PM   #187
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I liked the secondary market cuz I could buy a T bill that matured in mid August with a coupon that is more than half of a 1 year bill for just 4 months. If you can do that say 2 or 3 times a year the rate looks like it is quite a bit more than buying a 1 year bill unless I am misunderstanding what I saw.
Nope. Posted rates are always annualized. You're not getting that rate in 4 months. You're getting that annual rate for 4 months. Big difference.
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Old 04-09-2022, 07:45 PM   #188
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I assume you can do this in a roll over IRA?
In general, Yes, as Disneysteve pointed out. However, it has to be a brokerage account or the like. I.e., if you have a Vanguard mutual-fund-only account, or an IRA at your credit union or what have you, they cannot make this purchase.
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Old 04-09-2022, 09:05 PM   #189
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Originally Posted by Graybeard View Post



I liked the secondary market cuz I could buy a T bill that matured in mid August with a coupon that is more than half of a 1 year bill for just 4 months. If you can do that say 2 or 3 times a year the rate looks like it is quite a bit more than buying a 1 year bill unless I am misunderstanding what I saw, this is new stuff to me. But as mentioned, you pay a bit more on the secondary market.

You bring up a good point about timing maturities in the secondary market. I have big bills due in Sep and Dec. I can easily buy treasuries that mature within a week of when these payments are due.
In the secondary market the key rate is Yield to Worst/Yield to Maturity rather than the Coupon. Right now an early August ‘22 tbill pays .845 and a 1 year pays 1.97.
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Old 04-09-2022, 10:43 PM   #190
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PenFed just posted new rates:
3 Year
2.10%

4 Year
2.25%

5 Year
2.50%

7 Year
2.75%
Yeah
Saw this, if the 5 year gets into 3%+, will begin laddering. Hoping we can get back to 4%+
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Future rates
Old 04-10-2022, 07:31 AM   #191
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Future rates

Right now rates are ramping up and there is starting to be a sense that we may soon get some truly interesting rates on CDs, treasuries, etc.

Meanwhile the 10 year bond and futures are signaling rather low rates.

The people who did best in last mini-runup locked in CD rates north of 3 percent (or comparable treasuries or corporates). I wonder if that will be the case this time i.e. runup folllowed by declining rates?

I'm going to guess we will have a longer runway this time with Fed planning to unwind the balance sheet rather agressively, but if they trigger a recession (likely I think) then all bets are off.
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Old 04-10-2022, 07:35 AM   #192
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MYGAs are creeping up. 3.3% 5 year currently. We still are lucky to have some 4% CDs for a couple of years. At 70 I think we will move to MYGAs when they get above 4% and ladder 6 or so at the state's guarantee fund limits. Each contract is covered to the state limits, maybe not FDIC, but it is something. A- and A+ companies seem to be stepping up their rates.
We're looking at MYGAs also. 3.3% 5-year is pretty compelling. I think that one is with Brighthouse and available via BluePrint Income. If I'm not mistaken, Brighthouse is a spin-off of Met Life and a Fortune 500 company. That seems reasonably 'safe', but I'm also seeing even stronger companies like Mass Mutual (through FIDO) offering nearly comparable rates (3.2% from MM for 5-year MYGA).

New York Life and USAA are also offering pretty compelling rates through FIDO, and those all appear to be very strong financially with top ratings from AM Best and others.

We just bought a 3.2% 5-year and 3% 4-year from MM [A++ rating from AM Best, #123 on the Fortune 500 list] as we had a good chunk of cash that accumulated from matured CDs. Also have some other CDs maturing this Summer and Fall, so will hopefully pickup more MYGAs at even higher rates.

It's hard to guess where rates will go from here. While the Fed has been clear what their intent is, a number of analysts I follow closely are saying it's unlikely the Fed will get to the target FFR before they "break something" in the economy and have to back off (ie: lower rates and maybe even start another round of QE). Their reasoning seems solid to me. So, while Fed Governors like Brainard are talking 4+% FFR, that's unlikely to happen without severe recession and a major market meltdown. Given that, I figure grabbing some 3+% MYGAs now and seeing where rates are at in Summer and Fall is prudent..because we may be seeing a peak in the 10-yr and maybe even 2-yr USTs now, depending on how many future rate hikes are "baked in" to current yields by markets. (It's often said markets "look ahead" by 6 months or so, so the question becomes..how many 25 bps hikes are already "baked in" to current UST yields? That'd be interesting to know, as it would give better visibility into where MYGA and even CD rates might go from here).
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Old 04-11-2022, 01:41 PM   #193
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I bought my first T-bills from the Fidelity secondary market order tool. I had an issue with placing the order because the tool automatically defaults to the lowest price for a particular issue which generally has an order minimum of 300 bonds or more. You can click the depth of book link and it displays offers with lower minimums at slightly higher prices. Then you can select an offer with a minimum as low as 1 bond. The problem is that after selecting an offer with a lower minimum and selecting preview order, it goes back to the offer with a minimum of 300 bonds ($300k). I tried and tried and eventually it accepted the order. I bought another bond and had the same issue. It took four tries before the order was accepted. I think the order page display has been recently updated so maybe it is a glitch with the update. I'm looking for a feedback link now to see if I am doing something wrong. I bought a 5 month bill @.98% and an 8 month bill @1.45%
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Old 04-11-2022, 02:00 PM   #194
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We're looking at MYGAs also. 3.3% 5-year is pretty compelling. I think that one is with Brighthouse and available via BluePrint Income. If I'm not mistaken, Brighthouse is a spin-off of Met Life and a Fortune 500 company. That seems reasonably 'safe', but I'm also seeing even stronger companies like Mass Mutual (through FIDO) offering nearly comparable rates (3.2% from MM for 5-year MYGA).

New York Life and USAA are also offering pretty compelling rates through FIDO, and those all appear to be very strong financially with top ratings from AM Best and others.

We just bought a 3.2% 5-year and 3% 4-year from MM [A++ rating from AM Best, #123 on the Fortune 500 list] as we had a good chunk of cash that accumulated from matured CDs. Also have some other CDs maturing this Summer and Fall, so will hopefully pickup more MYGAs at even higher rates.

It's hard to guess where rates will go from here. While the Fed has been clear what their intent is, a number of analysts I follow closely are saying it's unlikely the Fed will get to the target FFR before they "break something" in the economy and have to back off (ie: lower rates and maybe even start another round of QE). Their reasoning seems solid to me. So, while Fed Governors like Brainard are talking 4+% FFR, that's unlikely to happen without severe recession and a major market meltdown. Given that, I figure grabbing some 3+% MYGAs now and seeing where rates are at in Summer and Fall is prudent..because we may be seeing a peak in the 10-yr and maybe even 2-yr USTs now, depending on how many future rate hikes are "baked in" to current yields by markets. (It's often said markets "look ahead" by 6 months or so, so the question becomes..how many 25 bps hikes are already "baked in" to current UST yields? That'd be interesting to know, as it would give better visibility into where MYGA and even CD rates might go from here).
I wonder why the Mass Mutual MYGA's have different yields in Blueprint vs Fidelity for the same 5 year maturity?
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Old 04-11-2022, 02:10 PM   #195
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I bought my first T-bills from the Fidelity secondary market order tool. I had an issue with placing the order because the tool automatically defaults to the lowest price for a particular issue which generally has an order minimum of 300 bonds or more. You can click the depth of book link and it displays offers with lower minimums at slightly higher prices. Then you can select an offer with a minimum as low as 1 bond. The problem is that after selecting an offer with a lower minimum and selecting preview order, it goes back to the offer with a minimum of 300 bonds ($300k). I tried and tried and eventually it accepted the order. I bought another bond and had the same issue. It took four tries before the order was accepted. I think the order page display has been recently updated so maybe it is a glitch with the update. I'm looking for a feedback link now to see if I am doing something wrong. I bought a 5 month bill @.98% and an 8 month bill @1.45%
Thanks for the update.

Unless HYS accounts start increasing soon, I'll be doing the same thing.
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Old 04-11-2022, 02:19 PM   #196
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I wonder why the Mass Mutual MYGA's have different yields in Blueprint vs Fidelity for the same 5 year maturity?
I don't see any Mass Mutual MYGA's on the Blueprint Income website even though Blueprint is OWNED by Mass Mutual. Fidelity shows a standard rate and a jumbo rate. Blueprint usually only shows the highest rate on the top level. You have to click the details link to see if there are "rate bands".
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Old 04-11-2022, 03:43 PM   #197
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I don't see any Mass Mutual MYGA's on the Blueprint Income website even though Blueprint is OWNED by Mass Mutual. Fidelity shows a standard rate and a jumbo rate. Blueprint usually only shows the highest rate on the top level. You have to click the details link to see if there are "rate bands".
My mistake. I was mixing up Mass Mutual with New York Life.
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Old 04-11-2022, 04:22 PM   #198
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My mistake. I was mixing up Mass Mutual with New York Life.
Both great companies, along with NWML.
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Old 04-11-2022, 06:58 PM   #199
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My mistake. I was mixing up Mass Mutual with New York Life.


I am pretty sure there is a difference due to rate bands. Fido has std and jumbo rates for most/ all of the annuities they sell. I think 100k is jumbo. On Blueprint they show 5 different rates depending on how much you invest. The minimum is 5k and the rate is 2.1.
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Old 04-11-2022, 07:48 PM   #200
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You can choose to roll them over or the money comes back to you at maturity. When they paid higher interest, I usually had between five and ten going at once with different maturities.
Right, I thought it was pretty slick and had several for a while. Ultimately CDs started to beat treasuries so switched to those. Quite a cycle which has you jumping between different cash-équivalents depending in which way interest rates are changing.
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