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

[NomDeER]

Just curious, are most of the responders on this particular thread already retired? Asking because I am still w**king and still have more than 7 years to go. What would you have done if you were working in current environment. Just wanted to get a perspective from those that are still w*rking.

Additional context:

We are contributing maximum to 401K, HSA, purchased I bonds (didn’t take advantage of gift giving option).

I retired at the end of 2021. If I had 7 years to go, I would be investing in equities today, but I also would be slowly building a cash/fixed income cushion and taking advantage of the current returns on CDs and treasuries. I'm currently using my cushion to fund my immediate living expenses (so I don't have to sell equities while they are so low) and also am buying short term treasuries and CDs with that cushion.

 

[erkevin]

Morgan Stanley is offering a (callable) 10-year CD @ 4.858% (YTM). CUSIP 61773TLD3

 

[NomDeER]

Morgan Stanley is offering a (callable) 10-year CD @ 4.858% (YTM). CUSIP 61773TLD3

Morgan Stanley also is offering a callable 7 year at 5%.

CUSIP 46593LQG7

 

[ShokWaveRider]

Morgan Stanley also is offering a callable 7 year at 5%.

CUSIP 46593LQG7

7 years is a little too long for me. I cannot think out that far now I am old"er". When I was younger 10 year high paying CDs were our staples and got us through the 90's.

 

[pletal]

7 years is a little too long for me. I cannot think out that far now I am old"er". When I was younger 10 year high paying CDs were our staples and got us through the 90's.

Me too, 10 years was nice!

 

[Karloff]

Have always followed this thread with interest. But I have yet to find *any* large bank that offers a CD or savings account with a yield above 0.25%. TD Bank is the only one that offers such a yield, and they have only offered this for the past month or so. All the rest of the banks in our area are still stuck at 0.05% or so.

I am referring to banks one can actually walk into, mind you.

I would love to hear from folks who can prove me wrong! Where can one get a *safe* 4% these days? I do not really understand T-bills and I do not feel comfortable investing in an online-only "bank".

 

[Another Reader]

Have always followed this thread with interest. But I have yet to find *any* large bank that offers a CD or savings account with a yield above 0.25%. TD Bank is the only one that offers such a yield, and they have only offered this for the past month or so. All the rest of the banks in our area are still stuck at 0.05% or so.

I am referring to banks one can actually walk into, mind you.

I would love to hear from folks who can prove me wrong! Where can one get a *safe* 4% these days? I do not really understand T-bills and I do not feel comfortable investing in an online-only "bank".

Lots of the big bricks and mortar banks offer CD's through brokers at the higher prevailing rates. Have a look at Fidelity or Schwab. Same FDIC insurance, The branch customer in many cases does not know about brokered CD's and the branch staff will not tell the customer.

 

[11522914]

Have always followed this thread with interest. But I have yet to find *any* large bank that offers a CD or savings account with a yield above 0.25%. TD Bank is the only one that offers such a yield, and they have only offered this for the past month or so. All the rest of the banks in our area are still stuck at 0.05% or so.



I am referring to banks one can actually walk into, mind you.



I would love to hear from folks who can prove me wrong! Where can one get a *safe* 4% these days? I do not really understand T-bills and I do not feel comfortable investing in an online-only "bank".

WOW. You're not kidding.

https://www.chase.com/personal/savings/bank-cd#rates

They do have a 12 or 24 month for 2.02%[emoji23]

 

[lawman]

As of today Schwab is predicting an even steeper inverted yield curve. They are advising clients to begin to lock in rates now instead or waiting until the Fed is done or nearly done. Schwab has a 3 yr and 5 yr. C.D. paying 4.6%. I may make a pretty large bet there..Anyone here going longer term now or are the majority holding off?

 

[Momcpa]

I've found some high 2%s and 3%s at local small town credit unions. Just had to deposit $5 to set up an account/be a member. Then just bought CDs. I have a 15 month 3%. Also a 24 month 2.96% with a one time bump up opportunity. Brick and mortar stores.

 

[11522914]

As of today Schwab is predicting an even steeper inverted yield curve. They are advising clients to begin to lock in rates now instead or waiting until the Fed is done or nearly done. Schwab has a 3 yr and 5 yr. C.D. paying 4.6%. I may make a pretty large bet there..Anyone here going longer term now or are the majority holding off?

Most are short term 1 month cd or treasury. But I slowly have been buying 5 to 10 year non-callable CDs or corporate bonds. Not much, just a little.

I recently bought a 10 yr non-callable CD paid monthly at 4.5%.

Freedom56 said to start making your list of bonds/cds to buy for the coming sell off. That's what I'm waiting for.

 

[Graybeard]

Just curious, are most of the responders on this particular thread already retired? Asking because I am still w**king and still have more than 7 years to go. What would you have done if you were working in current environment. Just wanted to get a perspective from those that are still w*rking.

Additional context:

We are contributing maximum to 401K, HSA, purchased I bonds (didn’t take advantage of gift giving option).

Retired but if I was working I'd be plowing money into equities, 401k, taxable and Roth. I always maxed out the Roth so maybe that doesn't count but definitely adding extra to 401k and taxable.

 

[lawman]

Most are short term 1 month cd or treasury. But I slowly have been buying 5 to 10 year non-callable CDs or corporate bonds. Not much, just a little.

I recently bought a 10 yr non-callable CD paid monthly at 4.5%.

Freedom56 said to start making your list of bonds/cds to buy for the coming sell off. That's what I'm waiting for.

I hope he will chime in here. If I'm not mistaken he has recently bought some with 5 - 7 year terms.

 

[Graybeard]

Vanguard VMFXX Federal Money Market and the Settlement Fund 7 day SEC yield is up to 2.75% today.

 

[TheCaptain67]

Just curious, are most of the responders on this particular thread already retired? Asking because I am still w**king and still have more than 7 years to go. What would you have done if you were working in current environment. Just wanted to get a perspective from those that are still w*rking.

Additional context:

We are contributing maximum to 401K, HSA, purchased I bonds (didn’t take advantage of gift giving option).

Not all of us are retired. Like you, I have around 7 years until I plan to retire.

We also do max 401K and buy iBonds. I have always wanted to own more fixed income but have always been put off by their subpar returns. I am starting to buy more now that some yields are approaching 5%. I would love to lock in some sweet 5-10 year yields above 5%, as our retirement plan is based around 5% overall returns. If I can get that mostly in bonds, then I will sleep very well at night.

 

[NomDeER]

As of today Schwab is predicting an even steeper inverted yield curve. They are advising clients to begin to lock in rates now instead or waiting until the Fed is done or nearly done. Schwab has a 3 yr and 5 yr. C.D. paying 4.6%. I may make a pretty large bet there..Anyone here going longer term now or are the majority holding off?

Could someone please help me understand what a steeper inverted yield curve is and what it's significance is? Why would we lock in rates now as opposed to next month or in November, December, or early next year?

 

[Freedom56]

I hope he will chime in here. If I'm not mistaken he has recently bought some with 5 - 7 year terms.

Okay I'll chime in. The longest term CD I have purchased is 3 years. For corporate notes is 7 years (with step up notes) and 5 years with fixed coupons. The last purchases I have made (yesterday) were the AMEX 3 year 4.4% CD (non callable) and the JP Morgan 4.75% 2 year note (below par at 4.83%). I am 100% in fixed income (CDs, treasuries, cash/money market, high grade corporate notes, high yield corporate notes). I don't buy equities and don't plan to. To me the stock market is a big casino that is still in a massive super bubble that is starting to pop. What I have been doing is de-risking my portfolio by increasing my allocation to high grade corporates and buying some CDs when their yields make sense relative to corporates and treasuries. Many of my high yield bonds are being called (three of them this past month alone) and the issuers are paying above par for these early calls. I am replacing them with high grade lower coupon notes. I believe there will be a major exit out of passive bond funds over the next three months and much more than the billions of redemptions every week. This will put pressure on individual bond prices but the impact will be temporary. Individual bonds/CDs mature at par. It made no sense holding bond funds going into 2022 and it makes even less sense now to own a bond fund that yields less than a 30 day treasury while it loses about 3 % of capital per week. Unlike an individual bond or CD that matures at par while it pays a fixed coupon, there is no par value for bond funds or even a fixed distribution. The SEC yield that bond funds are promoting now while hiding their distribution yields are a theoretical myth that will never be realized. Those Bogleheads that promote these funds don't understand bonds and basic arithmetic.

Watch the 2 year treasury rate. It is where the market believes the Fed funds rate will be in 12-18 months. Rates have moved up but they can only go so high with the current level of national debt. I can't see a scenario where the US spends the majority of it's annual budget servicing the national debt. The best case scenario for fixed income investors and savers is that rates top out where the 2 year treasury is today and stays there for the next 5 years. Equities and bond funds will have to price in that reality which they have yet to.

 

[lawman]

Okay I'll chime in. The longest term CD I have purchased is 3 years. For corporate notes is 7 years (with step up notes) and 5 years with fixed coupons. The last purchases I have made (yesterday) were the AMEX 3 year 4.4% CD (non callable) and the JP Morgan 4.75% 2 year note (below par at 4.83%). I am 100% in fixed income (CDs, treasuries, cash/money market, high grade corporate notes, high yield corporate notes). I don't buy equities and don't plan to. To me the stock market is a big casino that is still in a massive super bubble that is starting to pop. What I have been doing is de-risking my portfolio by increasing my allocation to high grade corporates and buying some CDs when their yields make sense relative to corporates and treasuries. Many of my high yield bonds are being called (three of them this past month alone) and the issuers are paying above par for these early calls. I am replacing them with high grade lower coupon notes. I believe there will be a major exit out of passive bond funds over the next three months and much more than the billions of redemptions every week. This will put pressure on individual bond prices but the impact will be temporary. Individual bonds/CDs mature at par. It made no sense holding bond funds going into 2022 and it makes even less sense now to own a bond fund that yields less than a 30 day treasury while it loses about 3 % of capital per week. Unlike an individual bond or CD that matures at par while it pays a fixed coupon, there is no par value for bond funds or even a fixed distribution. The SEC yield that bond funds are promoting now while hiding their distribution yields are a theoretical myth that will never be realized. Those Bogleheads that promote these funds don't understand bonds and basic arithmetic.

Watch the 2 year treasury rate. It is where the market believes the Fed funds rate will be in 12-18 months. Rates have moved up but they can only go so high with the current level of national debt. I can't see a scenario where the US spends the majority of it's annual budget servicing the national debt. The best case scenario for fixed income investors and savers is that rates top out where the 2 year treasury is today and stays there for the next 5 years. Equities and bond funds will have to price in that reality which they have yet to.

Thanks Freedom!

"I believe there will be a major exit out of passive bond funds over the next three months and much more than the billions of redemptions every week."

Do you consider PIMIX to be a passive bond fund? They just raised their distribution yield from .046 to .055 per share. Their current dist. yield is 5.05%. I'm thinking they must be taking some high risk positions..
https://www.pimco.com/en-us/investments/mutual-funds/income-fund/inst

 

[Car-Guy]

Another interesting thing that "seems" to be happening is how fast shorter term brokered CD's are disappearing. As you can see from my recent posts in this thread, I've been actively watching and buying CD's through Schwab this month. I didn't keep "count" of how many different banks CD's were available for each level of maturity but it was a "lot" more than are available today. Maybe more CD's are coming, but as of now, I'd "guesstimate" that the availability of 3 to 18 mo CD's is down ~75% from just a few weeks ago... And worse, anything below a year and it looks like the availability is down ~90%...

Maybe they just need to reload?

 

[John Galt III]

As of today Schwab is predicting an even steeper inverted yield curve. They are advising clients to begin to lock in rates now instead or waiting until the Fed is done or nearly done. Schwab has a 3 yr and 5 yr. C.D. paying 4.6%. I may make a pretty large bet there..Anyone here going longer term now or are the majority holding off?

I have already bought some 5 year CD's at 3.5% and 3.0 %. I am holding off with some more dry powder hoping for 4.0% 5 year (which has arrived, apparently!). I think Scwab must know what they are talking about, so it gives me more reason to pull the trigger on some 4% CD's at Vanguard. My other CD's are at Penfed, but those guys are still stuck down at 3.25% for 5 and 7 year. Penfed, I love you, but 3.25% is not good enough!

 

[John Galt III]

Vanguard VMFXX Federal Money Market and the Settlement Fund 7 day SEC yield is up to 2.75% today.

Thanks, Graybeard. I am getting up the nerve to transfer $10K into VMFXX. Currently have money in similar savings fund at Penfed at only 1.7%. Have been poking around the Vanguard website.

 

[TheCaptain67]

Thanks, Graybeard. I am getting up the nerve to transfer $10K into VMFXX. Currently have money in similar savings fund at Penfed at only 1.7%. Have been poking around the Vanguard website.

Do it. With VMFXX at 2.76% today, you would earn 62% more than at Penfed.

Very easy to ACH money to/from Vanguard.

I moved $40K there last month and am glad I did. Rates went from 2.17 to 2.76 in probably 2 weeks time due to the latest Fed rate raise.

 

[Northforker]

No 1 and 2 month CD's available this morning on Fidelity. One 3 month @ 3.20%. Yesterday there were several 1 and 2 month issues available? I guess everyone is waiting on the FED to jack it up some more next month? I know thats why I am buying 1 and 2 month issues hoping for better yields before year end.

 

[Chuckanut]

1 month cds are paying more than comparable Treasuries

The last time I built a CD/bond ladder a few weeks ago, it was mostly CDs but also had a few treasury bonds.

Rates vary by duration and the current interest environment. It only takes a few minutes to check both.

 

[Karloff]

Just noticed that TD Bank is offering the following:

CD's:
6 months: 1.5%
12 months: 2%.