Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 05-13-2020, 06:48 AM   #41
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 32,240
Quote:
Originally Posted by mrfeh View Post
I rarely play the bonus game, but I opened a Cap One savings account yesterday, although for a slightly different/better deal: $100 per $10K deposited and kept in the account for 90 days.

https://www.capitalone.com/score500/
+1 I also rarely play the bonus game but 2.5% for a year is attractive... I'll do $50k for me and $50k for DW... better than a one-year CD but a small risk that the 1.5% crediting rate might decline but if it does I'll just move the money out.

Thanks for the tips VungTau and mrfeh.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56
pb4uski is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 05-13-2020, 07:00 AM   #42
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 32,240
Quote:
Originally Posted by jazz4cash View Post
...Does anyone know what happens if you skizp the "free" withdrawal (i.e. do you get to take more the 10% the following year)?...
No, if you don't do the 10% in a given year it doesn't rollover.

Also check if you can do that at any time. I have a faint recollection that the 10% annual surrender charge-free withdrawal is a brief window around the policy anniversary to withdraw up to 10% without a surrender charge and then the window closes until around the next policy anniversary... so if your policy anniversary is in June and you want money out in January then it would be subject to surrender charge.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56
pb4uski is offline   Reply With Quote
Old 05-13-2020, 07:01 AM   #43
Thinks s/he gets paid by the post
 
Join Date: Jul 2013
Posts: 1,549
Quote:
Originally Posted by pb4uski View Post
+1 I also rarely play the bonus game but 2.5% for a year is attractive... I'll do $50k for me and $50k for DW... better than a one-year CD but a small risk that the 1.5% crediting rate might decline but if it does I'll just move the money out.

Thanks for the tips VungTau and mrfeh.
Our primary online savings account is Ally, and they're soon lowering their rate from 1.5 to 1.25 (I think? something close to that).

I assume Cap One will at least be competitive.
mrfeh is offline   Reply With Quote
Old 05-13-2020, 07:02 AM   #44
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 32,240
+1 Discover Bank is currently 1.4% and I presume that Cap One will be competitive... if they aren't then after the bonus is credited the world is my oyster.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56
pb4uski is offline   Reply With Quote
Old 05-13-2020, 07:12 AM   #45
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
calmloki's Avatar
 
Join Date: Jan 2007
Location: Independence
Posts: 6,907
Note eligibility: if you have been primary or secondary on a CapOne account after 1/2016 you aren't eligible. We are joint on many accounts and that has bitten us more than once. OTOH, having the other be a beneficiary is no good for the "couple struck by meteor" eventuality where we want someone else as beneficiary.
__________________
"Be kind whenever possible. It is always possible." Dalai Lama
calmloki is offline   Reply With Quote
Old 05-13-2020, 08:27 AM   #46
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 1,227
Quote:
Originally Posted by pb4uski View Post
No, if you don't do the 10% in a given year it doesn't rollover.

Also check if you can do that at any time. I have a faint recollection that the 10% annual surrender charge-free withdrawal is a brief window around the policy anniversary to withdraw up to 10% without a surrender charge and then the window closes until around the next policy anniversary... so if your policy anniversary is in June and you want money out in January then it would be subject to surrender charge.
I have a phone meeting with my Fidelity guy tomorrow, so I'll ask that question. I think DW and I are each going to get a 100K MYGA at 2%. Beats .37% I'm getting with my MM.

Already moved the taxable money to Ally and did the 1.5% no fee CD for most of it.

Will probably look to maybe get back into some shorter bond funds or ETFs.

Man, this sucks trying to find pennies on the street.
PatrickA5 is offline   Reply With Quote
Old 05-13-2020, 09:54 AM   #47
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 32,240
Quote:
Originally Posted by calmloki View Post
Note eligibility: if you have been primary or secondary on a CapOne account after 1/2016 you aren't eligible. We are joint on many accounts and that has bitten us more than once. OTOH, having the other be a beneficiary is no good for the "couple struck by meteor" eventuality where we want someone else as beneficiary.
So, I set up his and her accounts this morning. Could I also do a joint account?
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56
pb4uski is offline   Reply With Quote
Old 05-13-2020, 10:19 AM   #48
Full time employment: Posting here.
 
Join Date: Dec 2018
Posts: 966
Quote:
Originally Posted by Packman View Post
I'd like to get some of your knowledgeable opinions.

I hold a large amount of cash, about $600,000. I do this because, if the right opportunity arises, I may buy a new home before selling the current one, therefore not having to mess around with a mortgage and the associated fees as well as not having to move twice.

I now have $250k at Ally (max FDIC insured amount - I do not want a joint account) and the rest in MM funds at my broker, which are paying about 40 basis points. I am considering opening another account with a different online bank to get the current 1.5% interest rate. But it's a hassle - more paperwork, emails, etc.

So, the question is - what are the chances the online banks lower their interest rates for a savings accounts to something less than 1%, in which case I may not want to make the change? What other decent options might be available to me?
I also purchased a SF Bay house in 2011 for $250K and it is now worth $500K. I then rented my old house and the price of old house has also doubled. With high unemployment, chances are good that the price of real estate will be dropping. With the government printing money like crazy, inflation is a concern so having hard assets instead of paper assets is a smart move.

As far as where to put your money since CD and MM interest rates are getting low, The other option are short term treasury bonds since as VFIRX. Here are the most recent quarterly returns for the last 3 years and the annual returns from 2007 to 2016:

2020 2.70% (1st qtr)
2019 1.09%, 1.54%, 0.64%, 0.38% (1st, 2nd, 3rd, 4th qtr) 3.70% (total)
2018 -0.21%, 0.18%, 0.09%, 1.39% (1st, 2nd, 3rd, 4th qtr) 1.45% (total)
2017 0.28%, 0.21%, 0.29%, -0.39% (1st, 2nd, 3rd, 4th qtr) 0.39% (total)
2016 1.18% (total)
2015 0.55%
2014 0.82%
2013 0.00%
2012 0.79%
2011 2.36%
2010 2.76%
2009 1.54%
2008 6.76% (bear Market)
2007 8.02% (bear Market)
2006 3.93%

No negative return in 15 years with only 1 year at 0.00% return.

Note that the returns of VFIRX during the last bear market 2007 and 2008 and the 1st quarter 2020 are pretty good. This is because investors believe that treasuries are safer than equities and therefore the value of treasures tend to rise. Also note that the value of treasures include both capital return plus interest return = total return. There is some risk of interest turning negative but this risk may be offset by a higher capital return.

There is no doubt that VFIRX is a higher risk than MM and CD but that is how the system works: high interest = higher risk. low interest = lower risk.

Most smart investors (Warren Buffet) have recently increased their cash position so MM and CD are probably the best option for you since you may be buying real estate. Buying real estate in the middle of a recession or high unemployment is always a good thing.
2177V is offline   Reply With Quote
Old 05-13-2020, 10:29 AM   #49
Dryer sheet aficionado
 
Join Date: Apr 2007
Posts: 32
Fidelity-FCONX
joeprintz is offline   Reply With Quote
Old 05-13-2020, 11:14 AM   #50
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,797
Quote:
Originally Posted by PatrickA5 View Post
+1 I'm trying to figure out how to make more than the Fidelity MM (FZDXX) that is currently down to .4%. All of the brokered CD's are less than 1%. I'm wanting to keep my retirement funds at Fidelity. I've already moved my taxable funds to Ally.

I can get a 3yr MYGA from Mass Mutual or New York Life (both A++) for 2.1%. You can withdraw 10% per year penalty free and they have provisions for death, nursing home and hospitalization.

The other option would be buying some kind of short(er) term bond fund that yields over 2%. I would be willing to maybe take on a little interest rate risk, but not much. I'm just not finding much in the way of Fidelity bond funds that meet the criteria. I could always pony-up the $75 and buy a VG fund at Fidelity, if they are better.
My parents are in the same boat, as their 5 year CD matured and I am just holding it in the FZDXX fund currently.
Fidelity spoke to me about the MYGA for 2.1% for 3 years. My parents will definitely not need the money in those 3 years, so might go for it.
Would you go through Fidelity?
__________________
TGIM
Dtail is offline   Reply With Quote
Old 05-13-2020, 11:16 AM   #51
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,797
Quote:
Originally Posted by pb4uski View Post
+1 I also rarely play the bonus game but 2.5% for a year is attractive... I'll do $50k for me and $50k for DW... better than a one-year CD but a small risk that the 1.5% crediting rate might decline but if it does I'll just move the money out.

Thanks for the tips VungTau and mrfeh.
Parents have 50k in Ally HYS account.
Will probably make this move too for them.
Dollars here dollars there.
__________________
TGIM
Dtail is offline   Reply With Quote
Old 05-13-2020, 11:18 AM   #52
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,797
Quote:
Originally Posted by PatrickA5 View Post
I have a phone meeting with my Fidelity guy tomorrow, so I'll ask that question. I think DW and I are each going to get a 100K MYGA at 2%. Beats .37% I'm getting with my MM.

Already moved the taxable money to Ally and did the 1.5% no fee CD for most of it.

Will probably look to maybe get back into some shorter bond funds or ETFs.

Man, this sucks trying to find pennies on the street.
Please update us if you can.
Let us know if there is any gotchas if you don't mind.
__________________
TGIM
Dtail is offline   Reply With Quote
Old 05-13-2020, 11:23 AM   #53
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 1,227
Quote:
Originally Posted by Dtail View Post
My parents are in the same boat, as their 5 year CD matured and I am just holding it in the FZDXX fund currently.
Fidelity spoke to me about the MYGA for 2.1% for 3 years. My parents will definitely not need the money in those 3 years, so might go for it.
Would you go through Fidelity?
Yes, I plan on going through Fidelity to buy the Mass Mutual MYGA. I have a scheduled phone call for tomorrow. Hopefully, it won't be below 2%. I'm not willing to go longer than 3 years.

I could probably find slightly higher yields from lower rated insurance companies outside the ones that Fidelity works with, but we really don't want our IRA money split out all over the place. We just got through simplifying our finances by moving everything over to Fidelity and now we're moving things out looking for a few bucks.

I'll report back after talking to my Fidelity guy.
PatrickA5 is offline   Reply With Quote
Old 05-13-2020, 11:35 AM   #54
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 1,227
Quote:
Originally Posted by Dtail View Post
Please update us if you can.
Let us know if there is any gotchas if you don't mind.
Will do. I had a lengthy talk yesterday with a national Fidelity guy that is supposedly a licensed insurance broker. I really don't think there are any "gotchas" with these things as long as you are aware of the surrender fees and don't have any plans to take out money. Basically, the same as a CD.

You can take out 10% of the balance each year without penalty.

At the end, you can let it rollover automatically to another MYGA (at a lower rate 1.5%). You can buy a new MYGA. You can annuitize the money. Or, you can move the money roll it back to your original IRA.

Since it's in my IRA, I don't care about taxes, but if it's not in a retirement account, then you don't pay taxes on the interest until it matures - which can be a way to avoid some tax on interest for a few years.

Like other retirement vehicles, if you're under 59 1/2 and withdraw the money you'll owe a 10% penalty. I'm not in that category.
PatrickA5 is offline   Reply With Quote
Old 05-13-2020, 11:49 AM   #55
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,797
Quote:
Originally Posted by PatrickA5 View Post
Will do. I had a lengthy talk yesterday with a national Fidelity guy that is supposedly a licensed insurance broker. I really don't think there are any "gotchas" with these things as long as you are aware of the surrender fees and don't have any plans to take out money. Basically, the same as a CD.

You can take out 10% of the balance each year without penalty.

At the end, you can let it rollover automatically to another MYGA (at a lower rate 1.5%). You can buy a new MYGA. You can annuitize the money. Or, you can move the money roll it back to your original IRA.

Since it's in my IRA, I don't care about taxes, but if it's not in a retirement account, then you don't pay taxes on the interest until it matures - which can be a way to avoid some tax on interest for a few years.

Like other retirement vehicles, if you're under 59 1/2 and withdraw the money you'll owe a 10% penalty. I'm not in that category.
Thanks so much Patrick.
My parents monies are in a Taxable Trust account, so no issues there.
A minor point is transferring 3 years of interest at the end of the 3 year period into their regular taxable account and its tax brackets.
__________________
TGIM
Dtail is offline   Reply With Quote
Old 05-13-2020, 11:59 AM   #56
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,797
Different question.
I have read the FDIC limit rules, but want to double check here on the forum.

DGF - 144K in GTE IRA CD
DGF/Me - 91k in GTE Taxable joint account

Is my DGF limited to only add 15k more to her GTE IRA account, or can she add on any amount up to 250k to be protected by the FDIC insurance?
__________________
TGIM
Dtail is offline   Reply With Quote
Old 05-13-2020, 12:05 PM   #57
Recycles dryer sheets
 
Join Date: Jul 2018
Posts: 233
Quote:
Originally Posted by PatrickA5 View Post

You can take out 10% of the balance each year without penalty.
I do not have a FIDO MYGA but there was a small reduction on the interest rate for the Free 10% yearly withdrawal. I think it was .08%
Bruno is offline   Reply With Quote
Old 05-13-2020, 12:10 PM   #58
Recycles dryer sheets
 
Join Date: Jul 2018
Posts: 233
Quote:
Originally Posted by Dtail View Post
A minor point is transferring 3 years of interest at the end of the 3 year period into their regular taxable account and its tax brackets.
My plan is to use the FREE 10% withdrawal each year to pull out the yearly interest to spread it out over the 5 years.
Bruno is offline   Reply With Quote
Old 05-13-2020, 12:11 PM   #59
Thinks s/he gets paid by the post
 
Join Date: Nov 2006
Posts: 1,227
Quote:
Originally Posted by Bruno View Post
I do not have a FIDO MYGA but there was a small reduction on the interest rate for the Free 10% yearly withdrawal. I think it was .08%
That is probably a MVA annuity (market value adjustment). It looks at changes in interest rates and does some kind of adjustment when withdrawals occur.

I know the New York Life MYGA that Fidelity offers uses MVA. The Mass Mutual I'm considering doesn't.
PatrickA5 is offline   Reply With Quote
Old 05-13-2020, 12:14 PM   #60
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,797
Quote:
Originally Posted by Bruno View Post
My plan is to use the FREE 10% withdrawal each year to pull out the yearly interest to spread it out over the 5 years.
Interesting.
Good thought.
__________________
TGIM
Dtail is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
My simplistic approach to downside cost of Healthcare Insurance going forward... LARS Health and Early Retirement 24 11-15-2016 05:57 PM
What is your Health Insurance budget now and going forward/ golfersailor FIRE and Money 21 02-09-2013 02:20 PM
Real return going forward GTM FIRE and Money 7 04-09-2006 02:49 PM

» Quick Links

 
All times are GMT -6. The time now is 03:12 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2022, vBulletin Solutions, Inc.