Why is this is better than an ETF treasury fund, CDs, and high-interest savings accounts?
Answer: Treasury Bills "interest" is state & local tax-free on the money earned. So if you're in a high-income tax state and city they're worth it.ETF fund aren't always 100% in treasuries and charge fees.
Question (asked a dozen or more times in the thread) : How does bill interest work?
Answer: Treasury Bills "interest" is the difference between face value and purchase price. You buy a $10k bill at less than $10k, upon maturity, it is worth $10k. The difference between purchase price and maturity value is your "interest."
Tax Equivalent Yield Calculator For Savings Bonds, Treasury Bills, and Tax-Exempt Money Market Funds
https://www.mymoneyblog
How Buy and Sell Treasury Bills
https://thefinancebuff.com/treasury-bills-cd-money-market.html
When are the auctions? When can I place an order?
4, 8, 13, 17, and 26 week bills are auctioned every week.
52 week bills are auctioned every four weeks.
You can see recent results and the planned schedule at: https://www.treasurydir
4 and 8 week bills are usually announced on Tuesday, auctioned on Thursday, and settle on Tuesday.
17 and week bills are usually announced on Tuesday, auctioned on Wednesday, and settle on Tuesday.
13 and 26 week bills are usually announced on Thursday, auctioned on Monday, and settle on Thursday.
52 week bills are usually announced every 4th Thursday, auctioned on Tuesday, and settle on Thursday.
At a brokerage, you can usually can place an order between the announcement and auction.
At TreasuryDirect, you can place an order up to about 8 weeks in advance.
Top Comments
Treasury BILLS are currently paying over 5% for various maturity lengths under 1 year. These can be bought through most brokerages even without a TreasuryDirect account.
Treasury BONDS are paying 4% or less and have 20 or 30 year terms.
The 4 week bill ordering opens tomorrow 8/8, the deadline to buy it is sometime Thursday 8/10 morning depending on where you are buying it and it settles on 8/15.
On TD Ameritrade, they take your money on the 10th (take it out of the money you can trade with when you hit purchase which can be as early as the 8th) and buy the bill on the 15th during time which you earn no interest. Thus the reason that I stopped buying 4 and 8 week bills at auction. Secondary markets settle the next day so often a better deal. Treasury direct does not take the money from your bank account till the day it settles and Vanguard keeps it in the settlement fund earning interest till the day it settles as well. Not sure about the other brokerage houses. Also, not sure if you rollover the t-bills how the time between redemption and the next auction works as far as any interest you are losing as that is often a week of interest as well.
FYI, if you do the math, 4 weeks for $10,000 usually gets you about $40 in interest for letting them hold your money for 5 weeks.
The Monday auctions for 3 months and six months settle on Thursday so much less time to hold your money for nothing and less redemption downtime.
The money market funds often have repurchase agreements that are taxed at the state and local level but obviously more liquid. Am looking into the ETFs now.
Good luck to everyone!
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You did not quote my original post. TD Ameritrade, not Treasury Direct. They use the term new issues not auction. I kept looking for the word auction, called them, was told they use the term new issues not auction and then I was good. How is it intuitive that they don't use the word auction for the auction??
Landing page for fixed income for Vanguard does not show auctions just options and links for Brokered CDs, Treasuries, Corporate Bonds, etc. by ratings, percentages and time. No mention of auction. Have to click on the choice of treasury on the top row of categories and then it says the word auction to bring you to the auction page. Again was not intuitive to me, had to call to learn the process and was just trying to pass along what I learned. Posted all those details a few posts before the one that you quoted. I was answering the person who was upset that it looked like Schwab charged him more than the rate posted on the government results page and was suggesting that he call to see if he was not looking or buying in the correct place for the auction or if Schwab and had made a mistake that could be corrected. That does happen as well.
Agree that once you get to the auction and or new issue page it is very simple and straight forward on both sites.
Happy auctioning! Tomorrow is the 17 week bill that they don't offer on TD Ameritrade but do on Vanguard.
Why not just call Schwab and ask? I had to call TD Ameritrade and Vanguard to find out how to get to the auction page. It is not an intuitive system. They pick up quickly and are usually very helpful.
So I'll just say thank you for correcting me the first time. I listened, edited, learned and didn't make the same mistake again.
- Only need to pay Federal Tax, and no State Tax
https://www.treasurydirYou will need to open an account if you don't have one already.
https://www.treasurydir
Is this safe given Flitch downgraded credit rating?
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https://www.ufbdirect.c
https://www.ufbdirect.com/Savings...ld-savings [ufbdirect.com]
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