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Old 08-21-2019, 05:54 AM   #21
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I guess I am lucky. Because I have only mutual funds in my Fido accounts, I have no cash/core account to collect the dividends and cap gains spun off by the mutual funds. I can therefore have those distributions sent directly to my local bank's checking account, something I have been doing since I ERed 11 years ago. This gives me an automatic monthly "paycheck" without having to do anything. Furthermore, I can separately decide what to do with dividends versus cap gains. With one fund, I take the dividends in cash to my bank while reinvesting the cap gains. With another fund, I have used a variety of cash/reinvest combinations. And I can change these options whenever I feel like it, needing to give only a few days for them to take effect.


I don't know why Fido doesn't allow this option for mutual funds held in an account which does have a core/cash account. My (snake-bit) friend has a Fido account with the cash/core account and if he wants to sell shares and use its proceeds, it's a 2-step process: first sell the stuff then transfer the cash out.
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Old 08-21-2019, 08:31 AM   #22
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My cash flow management:
  • We withdraw a fixed % from our retirement account annually in Jan based on Dec 31 value.
  • Those funds are moved to a high yield savings account, and some funds are set aside for expected income taxes.
  • We have a monthly automatic draw on our savings account that goes to our checking account = "paycheck".
  • If we need more to cover larger expenses like travel or home maintenance or whatever, then an additional manual pull is made on our savings account to cover it.
  • During the year we let all dividends, interest and mutual fund distributions build in the retirement fund. Those will be drawn on the next Jan to fund the next year's withdrawal.
Pretty simple, I think. It certainly is mechanistically and most of it is automated. Has worked well for a very long time.
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Old 08-21-2019, 08:51 AM   #23
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Those funds are moved to a high yield savings account
What are you using for high yield savings? Ally yields 1.95% now.
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Old 08-21-2019, 11:18 AM   #24
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What are you using for high yield savings? Ally yields 1.95% now.
American Express Bank 2.1%


I also use the same method as Audrey, but, at Schwab if I get more than $2K in a sweep account, it gets moved to a Money Market Fund at Schwab. This is the first year I'm trying this method. At rebalance time it will be liquidating out of the MM to the brokerage account in order to buy ETFs.

- Rita
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Old 08-21-2019, 11:29 AM   #25
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at Schwab if I get more than $2K in a sweep account, it gets moved to a Money Market Fund at Schwab.
I've had more cash than $2K in my Schwab accounts and it's never been moved to a MM fund. I need to ask them about automated transfers, I looked last night and while they do have them, they seem to require a fixed amount. I couldn't find the "transfer all available cash" which is what I need.
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Old 08-21-2019, 11:41 AM   #26
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What are you using for high yield savings? Ally yields 1.95% now.
I have Amex Bank at 2.1% and Synchrony Bank at 2.15%. I also have an Ally Bank account but my funds there are invested in short-term CDs including no-penalty CDs yielding 2.3%.
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Old 08-21-2019, 12:05 PM   #27
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I have Amex Bank at 2.1% and Synchrony Bank at 2.15%. I also have an Ally Bank account but my funds there are invested in short-term CDs including no-penalty CDs yielding 2.3%.
Amex will be lowering it's rate to 1.90% effective tomorrow. Just got the email.


-Rita
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Old 08-21-2019, 12:06 PM   #28
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Amex will be lowering it's rate to 1.90% effective tomorrow. Just got the email.


-Rita
Yep, just got that now.
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Old 08-21-2019, 12:23 PM   #29
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I've had more cash than $2K in my Schwab accounts and it's never been moved to a MM fund. I need to ask them about automated transfers, I looked last night and while they do have them, they seem to require a fixed amount. I couldn't find the "transfer all available cash" which is what I need.
Sorry, Larry! I should have been more clear.

I have to move money (buy shares in) a Money Market Fund - there is no automatic sweep. They did have that at one time, available to all clients. But since then changed all their sweep accounts over to a bank instead of their low-paying in-house Money Funds - unless you have managed accounts or charitable accounts with them.

So, I used to just accumulate cash throughout the year to use to re-balance and withdraw annually. But, with the abysmal standard interest rates offered by their bank, you are better off periodically moving $$ from your bank account in Schwab to a Money Market fund. You have to buy shares in a fund. Then sell shares when you want to invest.

Current sweep rates at Schwab are .18% APY for amounts under $25k vs. Schwab Value Advantage Money Fund (SWVXX) at 1.99% with no minimum investment.

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Old 08-21-2019, 02:12 PM   #30
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I just spent an incredibly frustrating half-hour in e-chat with Schwab. I told them I already set up my Ally bank account for EFT, but although an online transfer could be set up as recurring, an exact amount had to be specified. The agent eventually got me to a paper form to set up something called MoneyLink, for which I needed to give my bank account numbers (they already have them), a voided check or deposit slip (Ally is an online bank, I don't have any), and then I can do automatic sweep-out of all new income, or certain kinds of new income (leaving any actual deposits untouched, which is a nice feature). When I said I didn't have checks or deposit slips, she offered to set it up on the spot... which I wasn't ready to do. So I guess when the time comes, I'll print the form and take it to the local Schwab office and have them help me.

Grrrr.
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Old 08-21-2019, 04:24 PM   #31
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I just spent an incredibly frustrating half-hour in e-chat with Schwab.
[...]
Grrrr.
I suspect the person you did the e-chat with is now posting on another internet forum the exact same thing about their day at work.
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