Emigrant Direct GOING OUT OF BUSINESS??

[Enuff2Eat]

I did NOT meant to get anyone excited. Just that I talked then convinced my wife into putting all her saving into Emigrant Direct and I am worry that if Emigrant Direct is going out of business so does my marriage.

I was just wonder if anyone here feel the same and if there is anything else I can do to prepare/avoid for this potential disaster. FDIC sounds good but what good does it do if the company is bankrupt. Like Enron when everything seems to going great then "BOOM" a lot of people lost everything. A couple people went to jail meanwhile an average joe like me could only do one thing. CRY...

Please give me your thought and last sorry for the mis-leading subject title.

enuff

MODERATOR Added question marks to the subject line to avoid inducing panic attacks in any readers.

 

[REWahoo]

Re: Emigrant Direct GOING OUT OF BUSINESS

...I am worry that if Emigrant Direct is going out of business so does my marriage.

I was just wonder... if there is anything else I can do to prepare/avoid for this potential disaster.

You can try being really nice to her, removing all knives & scissors from your house, and sleeping with one eye open....

 

[Gone4Good]

Re: Emigrant Direct GOING OUT OF BUSINESS

FDIC sounds good but what good does it do if the company is bankrupt. 

Pays you 100 cents on the dollar up to $100,000.  That is assuming the US Government doesn't also go bankrupt.

Rest easy.  I'm sure you have more important things to worry about then whether your FDIC insured deposits are going to pay.

 

[IHateCNBC]

Re: Emigrant Direct GOING OUT OF BUSINESS

These "internet banks" remind me of the saving and loan bank collapse (before the collapse).

 

[Cut-Throat]

Re: Emigrant Direct GOING OUT OF BUSINESS

I did NOT meant to get anyone excited. Just that I talked then convinced my wife into putting all her saving into Emigrant Direct and I am worry that if Emigrant Direct is going out of business so does my marriage.

I was just wonder if anyone here feel the same and if there is anything else I can do to prepare/avoid for this potential disaster. FDIC sounds good but what good does it do if the company is bankrupt. Like Enron when everything seems to going great then "BOOM" a lot of people lost everything. A couple people went to jail meanwhile an average joe like me could only do one thing. CRY...

Please give me your thought and last sorry for the mis-leading subject title.

enuff

I think you worry too much. - relax try to enjoy life, you'll probably be dead within 50 years.

 

[Texas Proud]

Re: Emigrant Direct GOING OUT OF BUSINESS

First off... I think you TITLE of your thread is a load of CRAP...

Then you say "I did not mean to get anyone excited".. well of course you did!!! You would not have said it if you did not mean to... and you KNEW what you were doing...

But, I do not care about them at all.. I do not use them.. was just wondering why they were going out of business..

 

[astromeria]

Re: Emigrant Direct GOING OUT OF BUSINESS

If the "volatility" of a bank has you in a dither, you were intended to have a pension 8) If that's not in the cards, put all your money under your mattress. Or buy an annuity. And STOP PANICKING!

 

[soupcxan]

Re: Emigrant Direct GOING OUT OF BUSINESS

Stop whining. And there are a variety of independent bank safety rating services like:

http://www.bankrate.com/brm/safesound/ss_home.asp

Not to mention, the FDIC knows when banks are going under and arranges for other banks to buy their assets, then has rapid response teams take them over at 5pm on a friday and has them re-opened by 8am monday. It's pretty cool.

 

[MJ]

Re: Emigrant Direct GOING OUT OF BUSINESS

If the "volatility" of a bank has you in a dither, buy an annuity.

and worry about the insurance company going bankrupt without a FDIC umbrella.

 

[LOL!]

Re: Emigrant Direct GOING OUT OF BUSINESS

OK, why bother to put your money at EmigrantDirect or ING or HSBC at all?  First, they all pay a lower interest rate than Vanguard.  Next, putting all one's savings in a savings account doesn't strike me as being diversified.

Now if Vanguard went out of business, then we'd be in a heap of trouble.  Maybe even more so than if the US Government went out of business since the latter is up to its eyeballs in debt already.

 

[NinjaPigeon]

Re: Emigrant Direct GOING OUT OF BUSINESS

Seriously, what's with the all caps saying something that isn't true and then claiming you aren't trying to get people excited? Maybe some decaf for you from now on!

And why would you convince your wife to put money into a savings/investment vehicle you didn't believe in? That strikes me as irresponsible, if not completely negligent. And the fact that the bank is based online rather than being B&M doesn't inherently mean it's any more prone to failure than one you might walk into down the street.

As always, look before you leap.

 

[NinjaPigeon]

Re: Emigrant Direct GOING OUT OF BUSINESS

OK, why bother to put your money at EmigrantDirect or ING or HSBC at all? First, they all pay a lower interest rate than Vanguard.

The different with the MM funds, even those that are tax exempt isn't so big of a difference to make me want to move my money out of ED. Or were you referring to something else?

 

[d]

Re: Emigrant Direct GOING OUT OF BUSINESS

First, they all pay a lower interest rate than Vanguard

... not quite. VMMP=5.12, ED=5.15. AmTrust and Amboy greater still. to the original issue ... there is, perhaps, fdic not withstanding, a potential liquidity issue.

 

[LOL!]

Re: Emigrant Direct GOING OUT OF BUSINESS

... not quite. VMMP=5.12, ED=5.15. AmTrust and Amboy greater still. to the original issue ... there is, perhaps, fdic not withstanding, a potential liquidity issue.

Actually, quite.  As someone else pointed out, the VMMP is a 7-day average yield, while ED is an APY.  Work out the math and ED has a lower 7-day average yield (or VMMP has a higher APY).

Anyways, which place has a better reputation, more financial resources, and less chance of absconding with your money? Don't you think if Vanguard was about to go under that the US government would bail it out?

 

[ats5g]

Re: Emigrant Direct GOING OUT OF BUSINESS

If anyone wants, they can check out any bank that is regulated by the FDIC at the FDIC's Institution Directory page. Immigrant Direct's FDIC # is 12054.

Per the FDIC's website, federal law requires the FDIC to make payments to the insured as soon as possible, which has be within a few days historically. You're not going to to much better than that.

Re Vanguard: Vanguard does not own the assets of the mutual funds. Each mutual fund is its own company owned by the fund's shareholders [you and me], and each mutual fund is a part owner of Vanguard. Hence, we own Vanguard [but don't have any voting rights]. However, IIRC, Vanguard does have an agreement w/ the funds that the funds will pledge up to 0.40% of their assets to Vanguard.

- Alec

 

[maddythebeagle]

Re: Emigrant Direct GOING OUT OF BUSINESS

maybe one of the modulators could change the title of this post Kinda like bait and switch

 

[riskadverse]

Re: Emigrant Direct GOING OUT OF BUSINESS

And I thought I was risk averse - buddy you need a belt with those suspenders.

 

[astromeria]

Re: Emigrant Direct GOING OUT OF BUSINESS

maybe one of the modulators could change the title of this post Kinda like bait and switch

Good suggestion, Ms Beagle--I added question marks to make the least change possible while helping to avoid heart attacks among board members.

 

[NinjaPigeon]

Re: Emigrant Direct GOING OUT OF BUSINESS

Actually, quite. As someone else pointed out, the VMMP is a 7-day average yield, while ED is an APY. Work out the math and ED has a lower 7-day average yield (or VMMP has a higher APY)

I'm not ashamed to admit the math is beyond my ability. Can someone help and provide the numbers? I'd like to understand this better.

 

[LOL!]

What are 7-day and 30-day yields?
Yield is a common measure of the income a mutual fund or other security produces. The U.S. Securities and Exchange Commission (SEC) prescribed in 1988 that all mutual funds quote their yields using standardized calculations so investors could make valid comparisons.

The 7-day yield is used only for money market funds. It consists of the dividend and interest income the fund pays over a 7-day period, net of expenses, expressed as an annualized percentage of the fund's share price.

7-day yield does not include much compounding (7 days worth at most).  While APY includes all the compounding  (say 365 days).

To get an APY of 5.15%, you only need an APR of X:  1.0515 = (1 + X/365)^365, where ^365 means raised to the 365th power.  Solving for X, you get a 5.0221% APR compounded daily equals a 5.15% APY.

So Emigrant pays a 5.0221% APR.

Or look at it from the money market side. Let's take the 5.12% of Vanguard and compound it weekly. 5.12% /100/52 = weekly interest rate W. (1+W)^52=1.0525 or a 5.25% APY.

 

[Caroline]

Just that I talked then convinced my wife into  putting all her saving into Emigrant Direct and I am worry that if Emigrant Direct is going out of business so does my marriage.

Just IMHO, I'd worry less about Emigrant Direct, and more about why you're talking and convincing your wife into doing things with HER savings.  Of course couples work together and share information.  But your worry that she'll blame you if something bad happens is only valid if you applied pressure, twisted her arm, or said anything that didn't end with a sincere "of course, the decision is entirely up to you dear, and I'll respect whatever you do."

None of us really KNOWS the best investment, and you certainly don't know her internal risk tolerance or understand what it takes her to sleep at night after putting "all her savings" into one basket.

I'd ponder THAT part of the equation if I were you.

On the other hand, if she loses all her money, she can't really AFFORD to end the marriage, now can she?  

 

[d]

Actually, quite

yep, i stand corrected. i promise to be more careful next time ... maybe.

 

[Texas Proud]

Re: Emigrant Direct GOING OUT OF BUSINESS

Good suggestion, Ms Beagle--I added question marks to make the least change possible while helping to avoid heart attacks among board members.

Still bad IMO... better would be..

Emigrant Direct.. what IF it went out of business

Going out of business, even with questions marks, infers that it is in trouble of going out of business or IS going out of business... either way.. I blame the original poster as he knew what he was doing..

 

[SecondCor521]

7-day yield does not include much compounding (7 days worth at most). While APY includes all the compounding (say 365 days).

To get an APY of 5.15%, you only need an APR of X: 1.0515 = (1 + X/365)^365, where ^365 means raised to the 365th power. Solving for X, you get a 5.0221% APR compounded daily equals a 5.15% APY.

So Emigrant pays a 5.0221% APR.

Or look at it from the money market side. Let's take the 5.12% of Vanguard and compound it weekly. 5.12% /100/52 = weekly interest rate W. (1+W)^52=1.0525 or a 5.25% APY.

Amboy Direct has an APY of 5.25% as of a few days ago, FYI, FWIW.

2Cor521

 

[Enuff2Eat]

Let me clarify why i am so damm paranoid. We came from a country that USED to have a similar system like FDIC then the country (or government) collapsed, so does all of the banking system and the hell with all of insurance...

I don't really know the details but can someone tell me what happen to your money if your money is sitting in some Iraq banks?

My parents trusted the bank and the government insurance (FDIC), yet when things falls apart, we went from rich to rags in NO time. Here in the Northeast of america, we had a major flood 3-4 years ago and a lot of people still complaining that the insurance still hadn't paid up yet. Does the insurance really work if the entire city and the next 10 zipcode area are under the water? or can the FDIC come thru if there is a major collapse in banking system?

last, sorry for the rude subject heading.

enuff

ps. yes my middle name is paranoid.