Fidelity-Brokered CD/Treasuries questions

[RetiredAndLovingIt]

I recently opened and funded a Cash Management Account at Fidelity.

1. Can I use this account to buy Brokered CD's and Treasuries or do I also need
to open The Fidelity Account as well. I think I do
2. How do I report the interest on these? Do i get a 1099-INT or similar and
report them yearly the same as bank CD's? I seem to recall reading
somewhere it may be different. I've only ever bought CD's
at banks and credit unions so I'm a complete newbie at this.
3. Once I figure out what I want, can I call Fidelity and talk to a real person for
help with my first purchase or do they charge for that?

 

[Happyras]

I have been buying treasuries on the secondary market in all of our accounts.
1.
Yes, there is no problem buying and holding them in the Cash Management account. We have both types and trust accounts as cash accounts.
2.
Your brokerage/account statement at the end of year will show 1099-int and 1099-div
3.
You can call and discuss for free. If you place a trade with them on the phone there are fees, but I am not certain for treasuries. I have a direct bond contact who actually calls me to see how I am doing. We get great support from Fido, but I never get charged a fee directly. (they make money, believe me...)

I have a good friend who helped me with my first dip into on-line t-bill purchases as well as covered calls to protect what we have. Fidelity has many tools and videos to explain steps. My biggest hurdle was understanding how they calculate the yields, but they do show market depth and pick the best for you on line if you choose to play with that tool.

 

[Happyras]

Also, I see no value currently in CD's, but if you want long term FDIC safety, I could see it. Those CD's we bought were short term waiting for the t-bills to catch up, now they are better except for 3 to 5 yr investment.

 

[COcheesehead]

The online fixed income buying tool at Fidelity is incredibly easy to use. Pick a yield and/or pick a quality level and/or pick a duration, buy. I personally recommend laddering any fixed income because of it hedge qualities.

 

[RetiredAndLovingIt]

I have been buying treasuries on the secondary market in all of our accounts.
1.
Yes, there is no problem buying and holding them in the Cash Management account. We have both types and trust accounts as cash accounts.
2.
Your brokerage/account statement at the end of year will show 1099-int and 1099-div
3.
You can call and discuss for free. If you place a trade with them on the phone there are fees, but I am not certain for treasuries. I have a direct bond contact who actually calls me to see how I am doing. We get great support from Fido, but I never get charged a fee directly. (they make money, believe me...)

I have a good friend who helped me with my first dip into on-line t-bill purchases as well as covered calls to protect what we have. Fidelity has many tools and videos to explain steps. My biggest hurdle was understanding how they calculate the yields, but they do show market depth and pick the best for you on line if you choose to play with that tool.

If they have videos that would be great, I'll check it out.
Thanks

 

[Al18]

Some recommendations if you’ve never bought a brokered CD:
1. You’ll probably want to buy only call protected CD. A CD that is not call protected might pay slightly more, but can be called (canceled) by the bank after a preset time - usually 6 months after purchase.
2. Interest does not compound on a brokered CD, it is simply deposited in your account.
3. Buying brokered CD’s is very quick at Fidelity - about 1 minute a CD. I think it’s just 4 mouse clicks.