Best CD, MM Rates & Bank Special Deals Thread 2022 - Please post updates here

[mrfeh]

I just called them and they had to research to find the answer. The prospectus is not clear. But I was told you only need the minimum initial investment of 100k to open the account. There is no minimum balance requirement after it has been opened.

I don’t believe it is an option to use as your core account but is owned as a mutual fund money market account within your brokerage account like any other mutual fund would be. So if you needed to use the funds you might have to transfer from the FZDXX to the core account and use the funds from there.

You have to purchase it like any other fund.

Thanks!

But just to be clear - the price per share remains at $1 over time, correct? There is no way to lose money by investing in it?

 

[Joylush]

Thanks!

But just to be clear - the price per share remains at $1 over time, correct? There is no way to lose money by investing in it?

Just research money market mutual funds to see how they work. Technically they lose money if the share price dips below a dollar. It is just extremely unlikely to happen.

If you want 100% protection you need to stick to an account type with FDIC insurance.

 

[COcheesehead]

Thanks!

But just to be clear - the price per share remains at $1 over time, correct? There is no way to lose money by investing in it?

I could be wrong, but I think back in 2008/2009 some money funds broke the buck, but the backer stepped in to prop it back up. I think the chances of you losing money in a Fidelity backed money market is virtually nil.

 

[Phroig]

Question: When placing an order through Treasury Direct for an auction today (with a settlement date on Thursday), when is the $$ taken from my checking account?

On the issue date. (First thing in the morning!) For my recent purchases, the issue date was 3 days after the auction date for the 26-week bill, but only 2 days after the auction date for the 52-week bill.

 

[Dtail]

I could be wrong, but I think back in 2008/2009 some money funds broke the buck, but the backer stepped in to prop it back up. I think the chances of you losing money in a Fidelity backed money market is virtually nil.

Agree and I don't believe any funds at Fidelity ever broke the buck.

 

[Dtail]

I just called them and they had to research to find the answer. The prospectus is not clear. But I was told you only need the minimum initial investment of 100k to open the account. There is no minimum balance requirement after it has been opened.

I don’t believe it is an option to use as your core account but is owned as a mutual fund money market account within your brokerage account like any other mutual fund would be. So if you needed to use the funds you might have to transfer from the FZDXX to the core account and use the funds from there.

All statements are correct.

 

[Dtail]

Ally all the way up to 1.85%.
They must sweating each 10 bps increase.

 

[lucky penny]

Question: When placing an order through Treasury Direct for an auction today (with a settlement date on Thursday), when is the $$ taken from my checking account?

On the issue date. (First thing in the morning!) For my recent purchases, the issue date was 3 days after the auction date for the 26-week bill, but only 2 days after the auction date for the 52-week bill.

Thank you. Yes, that's what happened. The "settlement date" on TD's auction calendar is the issue date & that's when the $$ was taken from my checking account. From previous experience I thought that's how it worked but wanted confirmation since I was transferring the funds from an online savings account, which usually takes 2 days. Worked out fine.

I see that for some T-notes the issue date is as long as 8 days after the auction date. That's good to know.

 

[gromit]

I see some differing posts on using funds in FZDXX.
Incoming $$ (including deposits and dividends received) - go to your core fund. Its up to you to buy FZDXX shares.

Spending $$ - According to Fidelity, if say you bought some stock, it will automatically draw funds from the core fund first. Once the core fund balance is exhausted it will automatically draw funds from the premium fund. You do not have to move $$ out of a premium fund to a core fund to spend it in your account. You don't have to worry that Fidelity will not find enough $$ for your purchase. They assess your purchasing power before accepting the trade.
In addition, you can have multiple premium funds, say FZDXX and the government premium fund FZCXX. In that case when spending $$ on a trade, the order of operation is to use the core fund first, followed 1st by the premium taxable fund with the largest balance.

 

[audreyh1]

Yes, you can verify this by simply seeing the available cash in your account when you place an order.

 

[FlaMariner]

Dominion Energy Reliability Investment is now paying 2.5% on balances of $50,000 +

 

[RetiredAndLovingIt]

Posted on the blog at depositaccounts.com. Shorter term, lower rate but I'm in since it's add on

Navy 33 months add-on promo is ending August 28th.
New promotion starting Monday: 20-month add-on CD at 3.0% APY. $1K minimum and $250K maximum. For regular accounts only - not available for IRA accounts. One CD per member.

 

[gcgang]

Just bot an 8/23/23 TBill for 3.31%.

 

[CatinKS]

Purchased a 10m CD for 2.75% ....things are starting to move.

 

[pletal]

Purchased a 10m CD for 2.75% ....things are starting to move.

Ten million in one CD . May be over the FDIC limits

Had to read that twice. Just had a large CD come due today that was 2.4 five years. Going to hold cash for awhile to see if long term rates go over 4

 

[TOOLMAN]

Ten million in one CD . May be over the FDIC limits

Had to read that twice. Just had a large CD come due today that was 2.4 five years. Going to hold cash for awhile to see if long term rates go over 4

MG My Guess

M million
m month

 

[COcheesehead]

I see some differing posts on using funds in FZDXX.
Incoming $$ (including deposits and dividends received) - go to your core fund. Its up to you to buy FZDXX shares.

Spending $$ - According to Fidelity, if say you bought some stock, it will automatically draw funds from the core fund first. Once the core fund balance is exhausted it will automatically draw funds from the premium fund. You do not have to move $$ out of a premium fund to a core fund to spend it in your account. You don't have to worry that Fidelity will not find enough $$ for your purchase. They assess your purchasing power before accepting the trade.
In addition, you can have multiple premium funds, say FZDXX and the government premium fund FZCXX. In that case when spending $$ on a trade, the order of operation is to use the core fund first, followed 1st by the premium taxable fund with the largest balance.

Yes, works almost just like a core fund, but you have to buy into it which is no biggie for the superior yield.

 

[Henry Lili]

Posted on the blog at depositaccounts.com. Shorter term, lower rate but I'm in since it's add on



Navy 33 months add-on promo is ending August 28th.

New promotion starting Monday: 20-month add-on CD at 3.0% APY. $1K minimum and $250K maximum. For regular accounts only - not available for IRA accounts. One CD per member.

Awesome Intel. The add-on feature with a higher 250 cap rather than 100 may be a nice port in the storm down the road. Open for the min. Then add on if it's the best option down the road. [emoji383]

 

[Henry Lili]

Ally all the way up to 1.85%.

They must sweating each 10 bps increase.

Leaving Marcus in the proverbial dust

 

[John Galt III]

Ten million in one CD . May be over the FDIC limits

Had to read that twice. Just had a large CD come due today that was 2.4 five years. Going to hold cash for awhile to see if long term rates go over 4

Copy that. But I may bite as low as 3.5%. Penfed now at 3.20% for 5 and 7 year CD. Bought some at that rate. Hoping for 3.5%. Had been hoping for 4 %.

 

[Drake3287]

Copy that. But I may bite as low as 3.5%. Penfed now at 3.20% for 5 and 7 year CD. Bought some at that rate. Hoping for 3.5%. Had been hoping for 4 %.

After yesterdays dismal Jerome Powell statement, we'll all be seeing rate increases well into the future. I suggest you find the speech online to hear exactly what he said.

By the first of the new year we'll be looking at near 5% for these longer term CD's. His statement yesterday all but guaranteed another 75 basis points again next month. For many people, paying early withdrawal penalties will be well worth it. Myself included.

 

[ShokWaveRider]

~2.3% is available in MM now, one does not have to look far. It is really about time we had "Proper" interest rates that reflect the economy and inflation. "~0" was a mistake in my opinion, led folks into a false sense of security. I also think that Mortgage interest needs to be removed as a tax deduction. Other Civilized countries seem to manage OK without it.

 

[Graybeard]

I am surprised how much the 1, 2, 3 month T bills have increased over the past few to several days while the Vanguard Settlement Fund seems to be stuck in the mud going up 1 or 2 bp.

 

[JoeWras]

I am surprised how much the 1, 2, 3 month T bills have increased over the past few to several days while the Vanguard Settlement Fund seems to be stuck in the mud going up 1 or 2 bp.

A few guesses on my part.

1)
Given: they achieve fast rate action via 1-day repurchase agreements.
Then: perhaps the repurchase market is saturated and they can't find a seller. I.E., this is a money market, and there are market dynamics.

2) [EDIT: I think this is bogus. Currently repurchase agreements are in the 65% range. I suspect it was over 50% on June 31 too. Too bad, the interest may not qualify in some states.]
Given: repurchase agreements do not pass the test for "US Obligations" in tax treatment
Given: some states require at least 50% of "US Obligations" to get favorable tax treatment of any ratio - all the income is all disqualified if it is even 48%.
Then: they may be moving holdings to at least achieve 50%, because the last thing they need is another tax fiasco controversy like last year.

The only thing that causes me to hesitate on my #2 theory is I'm not sure they met 50% at end of June. I don't know. It was close if they made it at all. Somewhere I read they were close to 70% in repurchase agreements at some point of time in the current volatile rate action.

Sunday learning references:
Repurchase agreements
US Obligation Info from Vanguard. Read the fine print at the end, all of it.

 

[Graybeard]

A few guesses on my part.

1)
Given: they achieve fast rate action via 1-day repurchase agreements.
Then: perhaps the repurchase market is saturated and they can't find a seller. I.E., this is a money market, and there are market dynamics.

2) [EDIT: I think this is bogus. Currently repurchase agreements are in the 65% range. I suspect it was over 50% on June 31 too. Too bad, the interest may not qualify in some states.]
Given: repurchase agreements do not pass the test for "US Obligations" in tax treatment
Given: some states require at least 50% of "US Obligations" to get favorable tax treatment of any ratio - all the income is all disqualified if it is even 48%.
Then: they may be moving holdings to at least achieve 50%, because the last thing they need is another tax fiasco controversy like last year.

The only thing that causes me to hesitate on my #2 theory is I'm not sure they met 50% at end of June. I don't know. It was close if they made it at all. Somewhere I read they were close to 70% in repurchase agreements at some point of time in the current volatile rate action.

Sunday learning references:
Repurchase agreements
US Obligation Info from Vanguard. Read the fine print at the end, all of it.

That was an interesting read about repros, I have heard them mentioned on CNBC but had no idea what they were talking about.

Now for the Vanguard Federal Money Market Fund VMFFX, it holds almost 73% in US government obligations. Does that mean that interest paid by the Settlement Fund (which is holding VMFFX) is exempt from CT state income tax? I thought I have read here that VMFFX interest is included in CT state income tax?