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14 Month No Penalty CD @ 4.40% APY - Sallie Mae Bank by Savebetter
January 3, 2023 at
05:30 PM
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Last Edited by jersharocks | Staff January 4, 2023 at 01:10 PM
I've posted this before when the rate was lower, but Savebetter.com increased their no penalty Sallie Mae CD to 4.40%. I cancelled my old one and opened a new one.
Savebetter.com has a No penalty CD @ 4.40% APY. You can break this CD anytime after 30 days. With Fed Reserve increasing rates, CDs in the near future will pay better. So lock in 4.4% for now; if you find a better higher earning CD in the future, break it and lock in. There's no minimum and FDIC insured to $250,000. For the bond heads that prefer treasury bonds, the comparable 1 month fed treasury yield is 4.17%, so this yields higher and offers a guaranteed return for longer if you choose to keep it. I haven't found a better rate out there that doesn't lock in your money for a longer period.
For people that want a higher earning CD they also offer a regular 27 mo CD @ 5% APY.
https://www.savebetter.
Savebetter.com has a No penalty CD @ 4.40% APY. You can break this CD anytime after 30 days. With Fed Reserve increasing rates, CDs in the near future will pay better. So lock in 4.4% for now; if you find a better higher earning CD in the future, break it and lock in. There's no minimum and FDIC insured to $250,000. For the bond heads that prefer treasury bonds, the comparable 1 month fed treasury yield is 4.17%, so this yields higher and offers a guaranteed return for longer if you choose to keep it. I haven't found a better rate out there that doesn't lock in your money for a longer period.
For people that want a higher earning CD they also offer a regular 27 mo CD @ 5% APY.
https://www.savebetter.
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It's a fixed-interest bond, so that's why a treasury can be worth less in resale than it's current accrued interest.
Conversely, it also can be worth more in resale than its accrued interest value if interest rates go down.
At any rate, I wouldn't buy more than 3 or 6 month since the Fed has indicated they still plan on raising rates, albeit more slowly. In 3 or 6 months you'll be able to roll the money into a new TBill at a better rate.
Ultimately none of that is an issue if you just hold it to term and collect your $1000.
I checked Fidelity and Schwab MM. Fidelity seem to have more tbills/t-bonds while schwab seem to have commercial bonds also in there. My suggestion is to review the portfolio holdings and make a decision based on the risk that you are comfortable with.
Today you can buy 8 week t-bills - around the same yield as swvxx and no state tax. Not sure if next week will have 13/26 week which may offer upto 4.7%. Also, if fed increases rates by 0.25-0.5% in the next meeting, it may make sense to ladder the t-bills based on maturity/yield. You can review the tbill rate trend using treasury link [treasury.gov].
Since schwab and Fidelity are competitors, they may not allow each others funds without a commission. But I feel schwab offers more mutual funds from other fund companies(not MM mutual funds, but other stock/bond funds) without commission and often with lower minimums.
Other option may be to buy the tbills from treasurydirect if you already have an account there, but it may be much easier to manage with Fidelity or Schwab.
Moving funds to a new Fidelity brokerage account from my savings so I can take advantage of the higher rates of Treasury bills...
https://www.schwabasset
This has been a very useful thread. I am reading up more to learn more.
Kindly correct me if I am wrong.
Unused funds in FCASH account are FDIC up tp $250k.
Brokered CDs are FDIC by the issuing bank up to $250k per account per issuing bank.
Unlimited T-bills can bought and guaranteed by the US Gov.
Did I miss anything. Still learning.
Will work on getting the 4 weeks n 8 weeks n 13 weeks to build a ladder starting next Tuesday announcement.
Thank you all for your post.!
I am learning and continue to learn.
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This has been a very useful thread. I am reading up more to learn more.
Kindly correct me if I am wrong.
Unused funds in FCASH account are FDIC up tp $250k.
Brokered CDs are FDIC by the issuing bank up to $250k per account per issuing bank.
Unlimited T-bills can bought and guaranteed by the US Gov.
Did I miss anything. Still learning.
Will work on getting the 4 weeks n 8 weeks n 13 weeks to build a ladder starting next Tuesday announcement.
Thank you all for your post.!
I am learning and continue to learn.
That is one feature I wish Schwab had as the cash sweep account offers very little interest which forces you to keep selling the MM funds first to invest elsewhere (1 day turnaround) or have a margin account to cover the trades.
Tbills are backed by treasury.
I do have a question around treasury MM funds like fidelity Let us say 70% of the dividend is from US govt debt obligations, then will 70% od thae dividend exempted from state tax? I thought that type of exemption was there with Munis holding bonds from different states, I wasn't sure if the same could be done with these MM funds primarily holding US debt.
Here is another schwab fund with a lower yield - 3.91% - but seem to be holding mostly US govt or agency debt. This seems similar to Fidelity govt MM funds with similar yields. Wondering if the govt/agency part of the debt qualifies for state tax exemption and if so whether this is a better option than the other schwab fund with 4.27%, especially in states with higher tax rates.
https://www.schwabasset
4.06% yield and most of it seem to be govt debt
https://investor.vangua
4.22% yield
https://investor.vangua
https://www.savebetter.
https://dsusprd01pubass
Also, on brokered CD's you are FDIC insured up to $250,000 per titled account (IRAS different than regular, business different than personal, etc.) but that total includes whether it is bought as a brokered CD or a CD directly from the bank.
Also, on brokered CD's you are FDIC insured up to $250,000 per titled account (IRAS different than regular, business different than personal, etc.) but that total includes whether it is bought as a brokered CD or a CD directly from the bank.
Joint accounts qualify for $500K, each owner insured for $250K.
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https://www.schwabasset