This is one of the highest rates currently available, however, there may be better options depending on your financial situation. Also, you will have to consider what it is worth setting up accounts at a new bank, which may or may not have good customer service. There are several high yield savings accounts in the low to mid 4% range with no lock up. However, if the rates go down (pretty unlikely for the next months) you would earn the going rate. They also increase if rates increase.
Another thing to consider is that you are taxed both federally and at the state level for interest. If you live in a high tax state and are in the middle class income brackets, you are probably better off buying treasuries or T-bills, which are not subject to income tax at the state level. So in California, assuming a > $66,296 income, you pay 9.3% in state tax and 22% in federal tax. If you buy a T-bill, you would earn 4.5% or so depending on the going rate and term, which is only taxed at the federal level. This is essentially equivalent to the 5% being taxed at the state and federal level. While not FDIC insured, if US treasuries fail, you probably can't rely on FDIC insurance. You can sell a treasury at any time, just at the market rate, which may go up or down.
There are number of things to consider other than rate, so do your homework. This is a very low risk way to earn 5% APY for the next 6 months, but there may be better options depending on the accounts you already have and your financial situation.
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OP's description is wrong.
This is what's on the website for this product.
No idea why this is getting down votes, but the 11 month @4.8% is a no-penalty CD, meaning you can withdraw at any time and keep the interest you accrued. Here, you have to hold for the full 6 months, otherwise you lose some of the interest you accrued. In an environment where the interest rates are changing rapidly, that no-penalty + longer duration is very valuable.
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Just and FYI: If you have a brokerage account you can purchase 1 month or 3 month, New Issue CDs for basically the same interest rate. Good if you don't want to tie up your money for a full 6 months, or if you want the option to roll over to a higher interest rate if rates go up in the next month or so. Plus you will not have to open another account at a different bank.
This, I moved over to bask because CIT notoriously does this. Create some new account flavor with a better rate and don't notify you proactively, of course as a customer I could care less what title of the month you call my online savings account, just give me the one with the best rate. Happier with bask bank no games.
Rate not as good. Bask has some issues with Texas ratio score and other factors.
I'm locked into a 5% CD for 27 months, think the best rate I've seen since was 5.35% (& it was callable which = not guaranteed to last to term). At some point you just take the rate & stop holding out for more.
& before someone says "you could get close to that in HYSA without having your money tied up"…I wanted the rate guaranteed for 27 months in case HYSA rates eventually fall during that window.
I also didn't want to go the i-bond route because I had way more than $10k to invest. You also have to forfeit 3 months of interest to cash out I-bonds. 3 months of no interest effectively lowers the I-bond rate down closer to 5%.
That was premature. Rates are getting a 25 bps hike tomorrow.
That was premature. Rates are getting a 25 bps hike tomorrow.
Kind of like the market, it's hard to call the very top.
Rates on the same deal are at 5.15% right now, another hike might move them to 5.4% max. That's an extra $1000 a year on a max $250k balance, extra $2250 total on 27 month term. Would've been nice to have, but you can also miss out on a good thing if you get TOO greedy.
After the initial investment, I took another $20k out of my cash savings & put it in another CD at 5% for 11 months with Capital One. That will pay close to $1000 before taxes, and I'll have the ability to reinvest it to make more next year (if rates are still good next January). I'm still happy with the deal I made.
This is one of the highest rates currently available, however, there may be better options depending on your financial situation. Also, you will have to consider what it is worth setting up accounts at a new bank, which may or may not have good customer service. There are several high yield savings accounts in the low to mid 4% range with no lock up. However, if the rates go down (pretty unlikely for the next months) you would earn the going rate. They also increase if rates increase.
Another thing to consider is that you are taxed both federally and at the state level for interest. If you live in a high tax state and are in the middle class income brackets, you are probably better off buying treasuries or T-bills, which are not subject to income tax at the state level. So in California, assuming a > $66,296 income, you pay 9.3% in state tax and 22% in federal tax. If you buy a T-bill, you would earn 4.5% or so depending on the going rate and term, which is only taxed at the federal level. This is essentially equivalent to the 5% being taxed at the state and federal level. While not FDIC insured, if US treasuries fail, you probably can't rely on FDIC insurance. You can sell a treasury at any time, just at the market rate, which may go up or down.
There are number of things to consider other than rate, so do your homework. This is a very low risk way to earn 5% APY for the next 6 months, but there may be better options depending on the accounts you already have and your financial situation.
Progressive tax structure so tax rate is considerably lower that 9.3% at $66k income. So is the federal tax rate.
I can't say yes or no to that since it depends on your finances. But for those who want to invest in a 6-month CD, this deal is bad compared to the 5.3% available from the Fidelity link I provided.
I can't say yes or no to that since it depends on your finances. But for those who want to invest in a 6-month CD, this deal is bad compared to the 5.3% available from the Fidelity link I provided.
My financial advisor has been throwing my extra cash into treasury certificate, some that are close to 5.5% and I can avoid NY States Taxes (which is 9%)
I'm sure its been said a million times before but if your state has income tax then you should probably consider a treasury certificate. Apparently it's easy to do but I'm just not smart enough to figure it out and I, ironically, have A LOT of free money so I just hired someone to do it for me.
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Another thing to consider is that you are taxed both federally and at the state level for interest. If you live in a high tax state and are in the middle class income brackets, you are probably better off buying treasuries or T-bills, which are not subject to income tax at the state level. So in California, assuming a > $66,296 income, you pay 9.3% in state tax and 22% in federal tax. If you buy a T-bill, you would earn 4.5% or so depending on the going rate and term, which is only taxed at the federal level. This is essentially equivalent to the 5% being taxed at the state and federal level. While not FDIC insured, if US treasuries fail, you probably can't rely on FDIC insurance. You can sell a treasury at any time, just at the market rate, which may go up or down.
There are number of things to consider other than rate, so do your homework. This is a very low risk way to earn 5% APY for the next 6 months, but there may be better options depending on the accounts you already have and your financial situation.
This is what's on the website for this product.
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Where at ?
Rate not as good. Bask has some issues with Texas ratio score and other factors.
CS had 5.30 but it expired.
What do you guys think?
& before someone says "you could get close to that in HYSA without having your money tied up"…I wanted the rate guaranteed for 27 months in case HYSA rates eventually fall during that window.
I also didn't want to go the i-bond route because I had way more than $10k to invest. You also have to forfeit 3 months of interest to cash out I-bonds. 3 months of no interest effectively lowers the I-bond rate down closer to 5%.
Rates on the same deal are at 5.15% right now, another hike might move them to 5.4% max. That's an extra $1000 a year on a max $250k balance, extra $2250 total on 27 month term. Would've been nice to have, but you can also miss out on a good thing if you get TOO greedy.
After the initial investment, I took another $20k out of my cash savings & put it in another CD at 5% for 11 months with Capital One. That will pay close to $1000 before taxes, and I'll have the ability to reinvest it to make more next year (if rates are still good next January). I'm still happy with the deal I made.
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Another thing to consider is that you are taxed both federally and at the state level for interest. If you live in a high tax state and are in the middle class income brackets, you are probably better off buying treasuries or T-bills, which are not subject to income tax at the state level. So in California, assuming a > $66,296 income, you pay 9.3% in state tax and 22% in federal tax. If you buy a T-bill, you would earn 4.5% or so depending on the going rate and term, which is only taxed at the federal level. This is essentially equivalent to the 5% being taxed at the state and federal level. While not FDIC insured, if US treasuries fail, you probably can't rely on FDIC insurance. You can sell a treasury at any time, just at the market rate, which may go up or down.
There are number of things to consider other than rate, so do your homework. This is a very low risk way to earn 5% APY for the next 6 months, but there may be better options depending on the accounts you already have and your financial situation.
Progressive tax structure so tax rate is considerably lower that 9.3% at $66k income. So is the federal tax rate.
https://fixedincome.fid
https://fixedincome.fid
good to
invest now?
invest now?
The original post is a few months old
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I'm sure its been said a million times before but if your state has income tax then you should probably consider a treasury certificate. Apparently it's easy to do but I'm just not smart enough to figure it out and I, ironically, have A LOT of free money so I just hired someone to do it for me.