How do you feel about laddering 5 $200K CD's at a institution such as Fidelity when the total account is only insured for $250K? Am I wrong?
Coz
That is a very good point, IMO. And that is the main reason I haven't bought any Schwab CD's in my IRA brokerage or bank accounts there.The only time to be concerned about FDIC insurance is if the broker has its own bank (as Schwab does), and issues its own CDs. Then you would want to limit your investment in their CDs to the FDIC limit of $250k.
The only time to be concerned about FDIC insurance is if the broker has its own bank (as Schwab does), and issues its own CDs. Then you would want to limit your investment in their CDs to the FDIC limit of $250k.
I don't get the difference. Don't you need to limit your investment in ANY bank's CDs to the $250k FDIC limits to be covered whether the bank is owned by the public, owned by a brokerage or owned by a bunch of bozos?The only time to be concerned about FDIC insurance is if the broker has its own bank (as Schwab does), and issues its own CDs. Then you would want to limit your investment in their CDs to the FDIC limit of $250k.
I don't think it is a good point at all. Please elaborate as to why it is. I have Schwab Bank CDs in my brokerage accounts... but under the $250k FDIC limits.That is a very good point, IMO. And that is the main reason I haven't bought any Schwab CD's in my IRA brokerage or bank accounts there.
I don't think it is a good point at all. Please elaborate as to why it is. I have Schwab Bank CDs in my brokerage accounts... but under the $250k FDIC limits.
Yes, you do. But one poster asked a question about whether the FDIC covered CDs bought through a broker. My response was just to caution that if their broker has their own bank and issues CDs, the FDIC limit still applies.I don't get the difference. Don't you need to limit your investment in ANY bank's CDs to the $250k FDIC limits to be covered whether the bank is owned by the public, owned by a brokerage or owned by a bunch of bozos?
I have several "accounts" at Schwab. "In one" of those accounts I typically keep 250k+ in cash (for quick investment opportunities, which could be just about anything), and lot's of CD's from other banks. I'm not concerned at all with the CD's/FDIC from the other banks that I have in that account. However, it's not clear to me how the FDIC would view a "250k CD from Schwab" sitting in that account along with the all the cash I keep there. I haven't given it a lot of thought since there are so many other CD options to buy. Probably not an issue but as I say, with so many other options I just opt for those. YMMVI don't think it is a good point at all. Please elaborate as to why it is. I have Schwab Bank CDs in my brokerage accounts... but under the $250k FDIC limits.
Fidelity states CD’s are covered by FDIC by the issuing bank. Secondly, Fidelity has extended SIPC coverage “customer limit of $1.9 million on coverage of cash awaiting investment.”
Link to this info https://www.fidelity.com/why-fidelity/safeguarding-your-accounts
PGOYes, you do. But one poster asked a question about whether the FDIC covered CDs bought through a broker. My response was just to caution that if their broker has their own bank and issues CDs, the FDIC limit still applies.
- Rita