[Aces4]

Originally Posted by dewilson58

Nope.

Example from Van's website: Vanguard Municipal Money Market Fund: The Fund is only available to retail investors (natural persons). You could lose money by investing in the Fund. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The Fund may impose a fee upon the sale of your shares or may temporarily suspend your ability to sell shares if the Fund’s liquidity falls below required minimums because of market conditions or other factors. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

Another: Vanguard Cash Reserves Federal Money Market Fund and Vanguard Federal Money Market Fund: You could lose money by investing in the Fund. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

As I thought. So you think peace of mind isn’t important.

[retiredguy123]

Originally Posted by Aces4

They are FDIC insured and no fees anywhere?

Not sure I understand your post. You can buy brokered CDs from Vanguard and Fidelity that are FDIC insured, and they will sell you U.S. Treasury products that are backed by the Government. They also sell non-insured products.

The Vanguard and Fidelity companies are not personally FDIC insured, but they don't fund the products that they sell. They are brokers who buy and sell products for you, and hold them in an account for you in your name. So, if you buy a brokered CD that is FDIC insured, you are protected the same way the original purchaser is protected.

[retiredguy123]

Originally Posted by Aces4

As I thought. So you think peace of mind isn’t important.

Note that all products sold by banks are not FDIC insured. FDIC deposit insurance only covers certain deposit products, such as checking and savings accounts, money market deposit accounts (MMDAs), and certificates of deposit (CDs). Other products like mutual funds and annuities are not FDIC insured, even if you buy them from an FDIC bank. So, a municipal money market fund similar to the Vanguard fund, referred to in Post No. 75, but sold by a bank, would not be FDIC insured.

[Aces4]

Originally Posted by retiredguy123

Not sure I understand your post. You can buy brokered CDs from Vanguard and Fidelity that are FDIC insured, and they will sell you U.S. Treasury products that are backed by the Government. They also sell non-insured products.

The Vanguard and Fidelity companies are not personally FDIC insured, but they don't fund the products that they sell. They are brokers who buy and sell products for you, and hold them in an account for you in your name. So, if you buy a brokered CD that is FDIC insured, you are protected the same way the original purchaser is protected.

No fees or other accounts necessary for brokered CDs? If a cd is brokered, there is either money taken off the top or at the end of the cd. One had better be sure their investment is FDIC insured and not something else.

[Caymus]

Originally Posted by Aces4

I didn’t realize those two companies are FDIC insured. Peace of mind…. Priceless.

All the "brokered" CDs I ever bought through Schwab and TD Ameritrade were FDIC insured.

[retiredguy123]

Originally Posted by Aces4

No fees or other accounts necessary for brokered CDs? If a cd is brokered, there is either money taken off the top or at the end of the cd. One had better be sure their investment is FDIC insured and not something else.

Vanguard and Fidelity do make money with built in management fees, but the quoted yields for brokered CDs are the actual yield that you will receive. There is no separate fee to have an account with these companies. A bank can only offer you CDs that they have created. But, Vanguard and Fidelity have access to thousands of products from thousands of sources. An individual bank cannot compete for yields with Vanguard and Fidelity.

[Aces4]

Originally Posted by retiredguy123

Vanguard and Fidelity do make money with built in management fees, but the quoted yields for brokered CDs are the actual yield that you will receive. There is no separate fee to have an account with these companies. A bank can only offer you CDs that they have created. But, Vanguard and Fidelity have access to thousands of products from thousands of sources. An individual bank cannot compete for yields with Vanguard and Fidelity.

That may be true but how many of those products are international and not FDIC insured. Local institutions tend to be very invested in their communities and country for the greater good of the people and their financial needs. To each their own and no one is calling my investment is a plus.

[Boomer]

Originally Posted by Aces4

That may be true but how many of those products are international and not FDIC insured. Local institutions tend to be very invested in their communities and country for the greater good of the people and their financial needs. To each their own and no one is calling my investment is a plus.

The Fidelity site has a list of banks for their brokered CDs. As you look at the list, you will see names of banks you know and there will be some whose bricks-and-mortar you mght drive past every day. Yet, you will not get the same rate by walking in the door.

You can choose call-protected or not. And the FDIC insurance is there.

I cannot figure out though how The Bank of China is FDIC insured, but it looks like BOCNY is based in NYC and somehow has the insurance and has had it for years. But you can just buy American banks. There are lots of choices on the list. You get to pick the bank(s).

Boomer

[Aces4]

Originally Posted by Boomer

The Fidelity site has a list of banks for their brokered CDs. As you look at the list, you will see names of banks you know and there will be some whose bricks-and-mortar you mght drive past every day. Yet, you will not get the same rate by walking in the door.

You can choose call-protected or not. And the FDIC insurance is there.

I cannot figure out though how The Bank of China is FDIC insured, but it looks like BOCNY is based in NYC and somehow has the insurance and has had it for years. But you can just buy American banks. There are lots of choices on the list. You get to pick the bank(s).

Boomer

For the small difference, I prefer to walk into my local S & L or bank. It’s less hassle and they match advertised rates in the area. It’s more convenient when RMD time rolls around and at this point in our lives, we’re tired of the treadmill and simple is our goal.

[Woodbear]

Originally Posted by Kenswing

5.26% yield on a 1-year Treasury at Fidelity right now.

Keeps going up. No reason to lock in long term


3mo 6mo 9mo 1yr
CDs (New Issues) 4.90% 5.00% 5.25% 5.40%

BONDS
U.S. Treasury 5.14% 5.27% 5.32% 5.36%

[dewilson58]

Originally Posted by Boomer

I cannot figure out though how The Bank of China is FDIC insured, but it looks like BOCNY is based in NYC and somehow has the insurance .Boomer

It was grandfathered in back in 1981.

[Caymus]

Originally Posted by Boomer

The Fidelity site has a list of banks for their brokered CDs. As you look at the list, you will see names of banks you know and there will be some whose bricks-and-mortar you mght drive past every day. Yet, you will not get the same rate by walking in the door.

You can choose call-protected or not. And the FDIC insurance is there.

I cannot figure out though how The Bank of China is FDIC insured, but it looks like BOCNY is based in NYC and somehow has the insurance and has had it for years. But you can just buy American banks. There are lots of choices on the list. You get to pick the bank(s).

Boomer

In the past I have purchased FDIC insured CD's from Bank Hapoalin (Israel), State Bank Of India as well as the Bank of China.

[Aces4]

Originally Posted by Caymus

In the past I have purchased FDIC insured CD's from Bank Hapoalin (Israel), State Bank Of India as well as the Bank of China.

I rest my case.

[Boomer]

It is too bad that these rates are a result of the Fed trying to play catch-up with inflation……when they have let stupidly low rates ride for years and years. That simply could not continue and now we are seeing the fallout.

But, hey, I will take these CD rates and play the short-term game. I recently bought Schwab and Truist and will be shopping again soon. (I did not buy into the BOC because I simply did not want to. I had looked up that FDIC thing for them just to see WTH? It has been there a loooong time.)

To each his/her own though. I understandand, and I would never try to tell anyone else where to put their money. If they ask me, I do share a very general idea of what I do.

We all have our own risk tolerance and we should behave accordingly. I have only 2 rules for when it comes to where to put money: 1.) Know Thyself and 2.) Understand what you are buying.

Boomer

[retiredguy123]

Originally Posted by Caymus

In the past I have purchased FDIC insured CD's from Bank Hapoalin (Israel), State Bank Of India as well as the Bank of China.

FDIC insurance has never made sense to me. The limit is $250K per account, but you can set up about 4 or more different accounts with different names and account types and easily get millions in coverage. And if you want more coverage, you can just open accounts in different banks. Apparently, foreign banks can sell FDIC insured products if they do business in the U.S. Obviously, the Government doesn't care about protecting taxpayer money with reasonable insurance limits. Personally, I don't think FDIC insurance is very important as long as you spread your investments around and diversify.