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Old 01-22-2023, 07:33 PM   #21
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I'm not sure what you mean by "agency issue" here, pb4uski?
By agency issue I mean a GSE or government sponsored enterprise like the Federal Home Loan Bank, Federal Farm Credit Bank and the like.... not full faith and credit but Aaa by Moody's and AA+ by S&P.

https://www.fidelity.com/fixed-incom...idual%20issuer.

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Agency Bonds

Agency bonds are issued by either agencies of the U.S. government or government-sponsored enterprises (GSEs), which are federally chartered corporations but publicly owned by stockholders.

Reasons to consider agency bonds
High credit quality
Variety of structures
Generally higher yields than Treasuries
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Old 01-22-2023, 07:37 PM   #22
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Originally Posted by SoReadyToRetire View Post
I was confused somewhat by that page on Fidelity, the FZDXX. There are a lot of different types of returns described--7 day, monthly, etc, but most of those are 1.x% or less. It's a money market fund, right? Does the interest compound daily or something? How else does yield get to over 4%?

I'm losing some of my smarts as I get older ...
The yield resets every trading day. Pay only attention to the current yield which is 4.27%.
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Old 01-22-2023, 09:03 PM   #23
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Originally Posted by SoReadyToRetire View Post
I was confused somewhat by that page on Fidelity, the FZDXX. There are a lot of different types of returns described--7 day, monthly, etc, but most of those are 1.x% or less. It's a money market fund, right? Does the interest compound daily or something? How else does yield get to over 4%?

I'm losing some of my smarts as I get older ...
If you're looking at https://fundresearch.fidelity.com/mu...mary/31617H805, the performance numbers are YTD (which is not annualized), 1-yr, 3-yr, 5, and 10. It's only been recently that interest rates have been relatively high so it's no surprise those returns are 1.x or 0.x%.

For the current 7 day yield, look at the left toward the bottom under "Portfolio Data". There you'll see a 4.26% 7 day yield.
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Old 01-23-2023, 06:39 AM   #24
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I just checked Fido's new issue CDs, and they have several at 2 year 4.5% that are call protected.
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Old 01-23-2023, 06:42 AM   #25
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Last week I bought 2 year and 5 year call protected bonds at 5.2%.
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Old 01-23-2023, 08:04 AM   #26
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Last week I bought 2 year and 5 year call protected bonds at 5.2%.
Corporate bonds? Rating?
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Old 01-23-2023, 08:14 AM   #27
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Corporate bonds? Rating?
A rated corporates.
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Old 01-23-2023, 08:30 AM   #28
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Based on this and other threads, I parked some post tax cash in some 3 month to 12 month CD's using the Fidelity brokered CD page. Somewhere in the range that you folks are seeing.

I wanted to bring up a Temptation. I am NOT going to do it, but a quick check of immediateannuities.com says that, based on my age and my sweetie's age (DW), they will give me a lifetime annuity payout (NOT RETURN) of 6.7%.

Please note that I occasionally check immediateannuities.com just to get a feel on the overall market. It has been offering lifetime rates in the 5% magnitude. This is over many years.
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Old 01-23-2023, 08:32 AM   #29
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A rated corporates.
Impressive!
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Old 01-23-2023, 09:21 AM   #30
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Quote:
Originally Posted by Z3Dreamer View Post
Based on this and other threads, I parked some post tax cash in some 3 month to 12 month CD's using the Fidelity brokered CD page. Somewhere in the range that you folks are seeing.

I wanted to bring up a Temptation. I am NOT going to do it, but a quick check of immediateannuities.com says that, based on my age and my sweetie's age (DW), they will give me a lifetime annuity payout (NOT RETURN) of 6.7%.

Please note that I occasionally check immediateannuities.com just to get a feel on the overall market. It has been offering lifetime rates in the 5% magnitude. This is over many years.
You can get an idea of the interest rates being used by looking at the IRR of period certain immediate annuities since there is no mortality component to them. Below is a table of current IRRs:
  120,000
52,1933.75%
101,2244.24%
159244.70%
207774.88%
257045.15%
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CDs Forever
Old 01-31-2023, 04:32 PM   #31
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CDs Forever

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Originally Posted by SoReadyToRetire View Post
Hello--

I've been sitting on about $193K in cash in my traditional IRA at Fidelity for awhile (out of a total of $520K).

At my recent check-in with Fidelity, it was suggested that I put that money to work now that interest rates are higher.

The suggestion was to put $175K into a 3-year Fixed Deferred Annuity with Mass Mutual. Interest rate would be 4.15%, which is slightly higher than what I'd get in CDs right now. I could withdraw 10% during all 3 years if needed without penalty.

Our total retirement funds right now between DH and me are $1.1M. (We took a big hit last year because we own too much NVDA--so I'm more risk-averse now. ) We'd still have plenty of cash in my husband's IRA, so it's not like we'd be tying everything up by doing this.

I have always been hesitant about annuities, but this one sounds okay. Anybody have thoughts or suggestions on this strategy? Or would you have to hear the rest of our details?

EDITED TO ADD: I decided to take my SS starting this month--$2600/month (age 64.5). My DH is younger and still working, for the next 3 years. So between us, all monthly expenses and a reasonable amount of "fun" money are covered. Thus, our IRAs are mostly "gravy", thankfully.
Get a Fidelity account and put the money in CDs, they have a great setup. Pick any length, best Bank, best rates. Money insured and almost liquid, and get off this goofy stock market.
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Old 01-31-2023, 08:45 PM   #32
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I just checked Fido's new issue CDs, and they have several at 2 year 4.5% that are call protected.
+1 ...and 4.5% at lesser duration.
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Old 01-31-2023, 09:15 PM   #33
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Get a Fidelity account and put the money in CDs, they have a great setup. Pick any length, best Bank, best rates. Money insured and almost liquid, and get off this goofy stock market.

Alternatively, dont let short term stock market fluctuations scare you from yielding 10+% a year in the stock market.
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Old 02-02-2023, 01:23 PM   #34
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Based on the various replies to my original question so far, I've decided to just go with a CD ladder. I've never done brokered CDs before, so I need to educate myself a bit.

Am thinking of starting with a 1-year ladder.

The only thing that sounds equally as good as doing this right now is the FZDXX mentioned by Marc. Can someone answer my questions in my previous reply in this thread about that, please and thank you?
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Old 02-02-2023, 01:35 PM   #35
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Quote:
Originally Posted by SoReadyToRetire View Post
Based on the various replies to my original question so far, I've decided to just go with a CD ladder. I've never done brokered CDs before, so I need to educate myself a bit.

Am thinking of starting with a 1-year ladder.

The only thing that sounds equally as good as doing this right now is the FZDXX mentioned by Marc. Can someone answer my questions in my previous reply in this thread about that, please and thank you?
Actually, your questions on FZDXX were answered in posts #22 and #23. With a money market fund, the only truly relevant yield is the current yield, The current 7-day yield is 4.29%. You can also look at the distribution yield, which is currently 4.44% annualized [((1+0.003627391)^12)-1]

Quote:
7-Day Yield 4

4.29%

1/31/2023
Quote:
Date Per Share Amount Reinvestment Price
1/31/23 $0.003627391 $1.00
Quote:
Originally Posted by SoReadyToRetire View Post
I was confused somewhat by that page on Fidelity, the FZDXX. There are a lot of different types of returns described--7 day, monthly, etc, but most of those are 1.x% or less. It's a money market fund, right? Does the interest compound daily or something? How else does yield get to over 4%?

I'm losing some of my smarts as I get older ...
Quote:
Originally Posted by COcheesehead View Post
The yield resets every trading day. Pay only attention to the current yield which is 4.27%.
Quote:
Originally Posted by RunningBum View Post
If you're looking at https://fundresearch.fidelity.com/mu...mary/31617H805, the performance numbers are YTD (which is not annualized), 1-yr, 3-yr, 5, and 10. It's only been recently that interest rates have been relatively high so it's no surprise those returns are 1.x or 0.x%.

For the current 7 day yield, look at the left toward the bottom under "Portfolio Data". There you'll see a 4.26% 7 day yield.
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Old 02-02-2023, 03:34 PM   #36
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And that FZDXX will probably be close to 4.5% within the next week or two.
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Opinions on my choice for first CD Ladder in my IRA?
Old 02-06-2023, 02:51 PM   #37
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Opinions on my choice for first CD Ladder in my IRA?

Well, here's what I picked to do once market opens tomorrow, in my Fidelity IRA--a 1-year CD ladder. What do y'all think--decent choices?

One of the CDs originally offered was thru Bank of China; I said no thanks to that one and picked another.

Oh, and I sold a bunch of individual stocks, so now I have a total of $390K cash to work with in this account. Figured I'd start with $280K just because it's a nice round multiple of 4000 and I don't want to tie up EVERYTHING.

Any reason other than convenience that I'd want to choose to Auto-Roll?
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Old 02-06-2023, 03:03 PM   #38
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Now I'm wondering--if I don't mind tying this money up for a whole year, I'd be better off to just buy a single 1-year CD for the full amount, eh?

I never thought I'd have this many questions about CDs
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Old 02-07-2023, 09:23 AM   #39
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Do any of you experienced CD ladder people see any drawbacks to the choices I'm making, before I make the purchase?

Are there hidden costs I should be aware of, or other reasons why it'd be better to go for a longer-term ladder?

Thank you!
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Old 02-07-2023, 10:23 AM   #40
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Now I'm wondering--if I don't mind tying this money up for a whole year, I'd be better off to just buy a single 1-year CD for the full amount, eh?

I never thought I'd have this many questions about CDs

I like simple, especially for the relatively short term of your ladder.
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