[New Englander]

Originally Posted by retiredguy123

Fidelity. One year CD, 4.65 percent, five year CD, 4.4 percent.

Is that Fidelity CD FDIC insured?

[New Englander]

Originally Posted by Michael G.

I'm the same way.
Although I'm do a lot on my computer, but taking $5,000 - $10,000 and investing on line
just seems weird.

It's not weird at all.

[retiredguy123]

Originally Posted by New Englander

Is that Fidelity CD FDIC insured?

Yes. But now you can get higher rates. The 1-year CD is 4.85 percent and the 5-year CD is 4.65 percent. You can go to Fidelity.com and view all of the available CDs.

If you don't like investing online, you can make an appointment with a Fidelity representative at their Lake Sumter office.

[daniel200]

Originally Posted by keepsake

Even if your CD cannot be touched for lets say two years, you are taxed on the interest income, yearly. Go figure damn IRS. You are told you have to pay a penalty for early withdrawl. So how do you get the damn money to pay the interest tax ?

There is an easy way to delay the taxes
Buy a US Treasury on the secondary market (Fidelity, Vanguard etc) with a very low interest rate. You can find zero interest or low interest (say 0.25% or 0.5%)

Because of the low interest you can buy these at a discount that brings the yield to maturity equal to recently issued treasury bonds. Just make sure the maturity date is longer than 12 months from the date you purchase.

The interest is taxed yearly (but your interest is minimal).
At bond maturity, you have a long term capital gain that is taxed at long term capital gain rates.

So if you buy a two year zero coupon (0% interest) … you pay no yearly tax on interest because no interest was paid. At the end of two years you are taxed on a long term gain (currently about 8% = 2 years x 4% / year).

Currently for a married couple, their first $83,000 in long term gains are taxed at zero! So no tax on the long term gain if your total long term gains is less than $83,000

[Caymus]

Originally Posted by keepsake

Even if your CD cannot be touched for lets say two years, you are taxed on the interest income, yearly. Go figure damn IRS. You are told you have to pay a penalty for early withdrawl. So how do you get the damn money to pay the interest tax ?

CD's are available that pay interest monthly or semiannual.

[retiredguy123]

Originally Posted by Caymus

CD's are available that pay interest monthly or semiannual.

With a CD, it doesn't matter how often the interest is paid. The IRS taxes you on the amount of interest that is "earned" during the tax year, regardless of whether or not you actually received the interest.

[Caymus]

Originally Posted by retiredguy123

With a CD, it doesn't matter how often the interest is paid. The IRS taxes you on the amount of interest that is "earned" during the tax year, regardless of whether or not you actually received the interest.

The poster was concerned about not having the money to pay the interest tax. A monthly or semiannual payment would help with that issue.

[coralway]

Originally Posted by Michael G.

Anyone here sign up for online banking, Savings, CD's, or money market?
Are they safe?

Interest rates are great

Fidelity Investments gets my vote. Been with them since 1985. They offer everything - including crypto, if your into that. They also offer interesting and educational webinars.

[44Apple]

Money Mkt Fund, not Money Mkt Account.