Best CD, MM Rates & Bank Special Deals Thread 2022 - Please post updates here

[Montecfo]

^^^ market seems to expect rate rise cycle to quickly tank the market, or inflation to come under control quickly.

We will see.

 

[erkevin]

TDA is showing 1 yr CDs at 3%; AMEX, UBS Bank, Ally, Morgan Stanley, Discover. These rates have not changed in regards to yesterday's FED move yet.

 

[JoeWras]

Stop the presses!!!! Ally MM is up to a "whopping" 1.40% Still have some catchin' up to do.

 

[Earl E Retyre]

This may be old news but noticed that Synchrony high yield savings is up to 1.65%

 

[Dtail]

Stop the presses!!!! Ally MM is up to a "whopping" 1.40% Still have some catchin' up to do.

Yeah whoop de doo. Conceptually, if this was a few years with today's yield space, Ally would be one of the leaders at around 1.8 - 2.0%.

 

[Love This Community]

I have a 3.25% interest rate on my investment property with a balance of $39K. I am thinking of putting $30K in 2-year TDA brokered CD currently at 3.5%. Do you think is a good idea?

 

[Gotadimple]

Well this was very quick - for American Express.

Effective 7/29, American Express High Savings goes to 1.25% - up from 1.15% declared on 7/15.

 

[calmloki]

I have a 3.25% interest rate on my investment property with a balance of $39K. I am thinking of putting $30K in 2-year TDA brokered CD currently at 3.5%. Do you think is a good idea?

Used to have a home loan with PenFed and a couple CDs as well. It just tickled me that they were paying me a little more than I was paying them even though they were holding the money. Very little difference in terms of money earned, but there was some security in having the ability to break and access the CDs vs paying off the home loan and not having a backup store of cash.

In your case it's worth $150 for the two years and $30k, right?

 

[Happyras]

I just checked and Marcus has gone up from 1.2% to 1.5% today. With the referral and AARP bonus, that makes 2.6%, which is spot on matching the 3 mo T-bill secondary market yield. Made me decide to roll more to Marcus today, rather than buying a treasury. It just feels more liquid in a FDIC HYSA, even though I know I could sell a T-Bill whenever.

 

[Freedom56]

What a change in just a few weeks. CD yields are better than treasuries, AA, and AAA, corporate notes. All the good issues of new high grade corporate bond are gone. All those 4.5-5% coupon high grade corporate notes vanished. There are no more bargains in the secondary market either. Now traders believe the Fed funds rate will top out at 3.25-3.5% by early next year. I'll wait for the next panic selling phase to buy again. Money market funds should top 2% in a few weeks.

 

[11522914]

What a change in just a few weeks. CD yields are better than treasuries, AA, and AAA, corporate notes. All the good issues of new high grade corporate bond are gone. All those 4.5-5% coupon high grade corporate notes vanished. There are no more bargains in the secondary market either. Now traders believe the Fed funds rate will top out at 3.25-3.5% by early next year. I'll wait for the next panic selling phase to buy again. Money market funds should top 2% in a few weeks.

I've noticed that too. Since this is my first attempt at purchasing corporate bonds (based on what I learned here) I bought 10 different bonds at 2k each for a total of 20k. Most bought between 93 and 97.

Most are over 100 now. I'm tempted to just buy non-callable 5 year cds at 3.55%.

I was waiting for some really good deals but they're not happening right now.

Freedom. Although you're waiting right now any suggestions on something better than 3.55% 5 year cds?

 

[Freedom56]

I've noticed that too. Since this is my first attempt at purchasing corporate bonds (based on what I learned here) I bought 10 different bonds at 2k each for a total of 20k. Most bought between 93 and 97.

Most are over 100 now. I'm tempted to just buy non-callable 5 year cds at 3.55%.

I was waiting for some really good deals but they're not happening right now.

Freedom. Although you're waiting right now any suggestions on something better than 3.55% 5 year cds?

I had about $38K in coupon payments deposited today in my two accounts at Fidelity. I couldn't find anything in A rated notes so I just bought $40K of Capital One 3 year non-callable CDs at 3.45%. I still have more cash to take advantage of any future sell-offs and coupon payments coming in monthly. If you bought any low coupon bond/notes at $92-$97 and they are trading above par now, you should consider selling them and just buying CDs with the proceeds especially if they are short in duration.

 

[Chuckanut]

Most are over 100 now. I'm tempted to just buy non-callable 5 year cds at 3.55%.

Not that I question your judgement, I have no idea what the future holds and your situation is undoubtedly different from mine......

But, with inflation at 9+% why lock in money for five years knowing that in real terms it may lose a lot of value? Are people that certain that the Fed will get inflation under control?

I look at the recent Tech bill that started at 76 Billion to build more semiconductors in the USA and is now edging towards 280 Billion dollars.

How can the Fed reduce interest rates or even hold them still in the face of such profligate spending?

Am I missing something?

 

[Love This Community]

Used to have a home loan with PenFed and a couple CDs as well. It just tickled me that they were paying me a little more than I was paying them even though they were holding the money. Very little difference in terms of money earned, but there was some security in having the ability to break and access the CDs vs paying off the home loan and not having a backup store of cash.



In your case it's worth $150 for the two years and $30k, right?

That’s my thought process as well. Keeping the liquidity while paying off the mortgage with close to net 0% interest rate

 

[pb4uski]

... How can the Fed reduce interest rates or even hold them still in the face of such profligate spending?

Am I missing something?

Well in theory, the impact of interest rates on the federal budget is not the Fed's concern... just stable employment and stable prices (modest inflation)... so in theory the Fed should have blinders on with respect to the impact of their actions on the federal budget.

What irks me is that the US Treasury didn't issue more longer term debt when interest rates were at historic lows... like refinancing your house with interest rates are low is a smart move. Steve Mnuchin and Janet Yellen were both asleep at the switch on that one.

 

[xlf11]

Wealthfront just increased from 1.4 to 2%.

 

[Freedom56]

If people were expecting the 10 year treasury note to surge to 5% or 9%, it's not going to happen. There is far too much debt in the system that has to be refinanced. With a Fed funds target of 3.25%-3.5% plus quantitative tightening, it is effectively causing a "shadow rate" of 5-6%. The vast majority of the inflation was caused by easy money flooding into the economy, corporate gouging, and market manipulation by commodity traders. The reality is that there is far too much inventory now in the system. First it was the retailers, now it has spread to the technology sector. Intel reported a pretty dire earnings and their forecast was even worse. Prices are collapsing fast for consumer items and that trend will only get worse for these companies who raised prices during the past year to boost profits. The Fed was slow to raise rates and will be slow to ease rates. This is why the bond market is signaling a recession and long rates continue to drop.

 

[aja8888]

What a change in just a few weeks. CD yields are better than treasuries, AA, and AAA, corporate notes. All the good issues of new high grade corporate bond are gone. All those 4.5-5% coupon high grade corporate notes vanished. There are no more bargains in the secondary market either. Now traders believe the Fed funds rate will top out at 3.25-3.5% by early next year. I'll wait for the next panic selling phase to buy again. Money market funds should top 2% in a few weeks.

I noticed that too. The market is laughing off the FED's rate raise. But earning coming in are not good (WMT, Amazon, Apple, etc). I believe this is a short covering rally and it will end and the market will continue down. I'm waiting this out. I saw 3% one year CD's at Schwab today.

 

[Dash man]

I just bought two more gift iBonds in DW’s and my TD accounts. These will be for 2024 delivery. Still the best thing going and I don’t think inflation is going away any time soon.

 

[jim584672]

Anyone have an idea where the 5 year rates will top out at? I'm hoping more than 3.5%.

 

[Car-Guy]

I've never bought a brokered CD (until this week) but I am planning to buy maybe 500k in CD's between now and the end of the year if rates go up like I expect. 4% will do for anything 24 months or less.

So as a test case, I bought a $10k CD to see how it worked at Schwab... Everything went as expected (very easy to do) until the CD posted on my account.

Then I found, I really don't like the way the accounting is done.

So if I buy a share of any stock or an ETF they post it as an asset in my brokerage account in separate categories. I would expect that stock or ETF to change values every day with the rise and fall of their market prices. The CD is posted in a separate category too (as expected) but it has a daily price change too . (Unexpected) So the CD shows my original purchase price (or cost basis) as 10k (as expected) but then, each day, they show the current value of the CD based on what it could be sold for on the secondary market rather than leave it at the original 10k cost basis. This is going to mess up my total account value tracking since I intended to hold my CD's until maturity and not sell on the secondary market.

So if I hold until maturity, I get my 10k back and all interest. So using the secondary market as a valuation of the CD really doesn't mean anything but makes it look like the CD is worth more or less than it really is and it changes daily.

Confused yet?

Anyone know why they do this?

How do other brokerage firms handle the accounting of brokered CD's"? Same as Schwab?

 

[jim584672]

It is current market value of the security, that is how all brokers will show a brokered CD. Since you are holding to maturity just ignore the ups and downs since you know the value at maturity, which is what matters.

 

[Car-Guy]

^^^^
Yep, that's what they told me when I called. It's just an unexpected adjustment/complication I'll need to make in my linked spreadsheets.

 

[pb4uski]

Yes, brokered CDs work essentially the same as bonds or UST... valued at market so changes in interest rates impact the value but you get the principal or stated value at maturity. I'm surprised that you were surprised. To me it's no big deal as I intend to hod to maturity either way. Only wierd thing is that the bank CDs that I own are at pricipal value including interest reinvested but a brokered CD with similar terms is at market. No big deal for me.

 

[Car-Guy]

^^^
I never brought a brokered CD before so I didn't expect it... I can make some adjustments in my external spreadsheets to account for it... Just something else to do I guess.