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Frequent Contributor

RMDs coming up, and I've accumulated some other cash in standard savings/checking accounts.  Some is currently tied up in CDs at 2.5% for a few more months.  I'm looking for places to put money in exchange for bonuses, higher interest rates, etc. 

CITI has a bonus being offered of $500 on a minimum $15k deposit to a new checking account for 60 days.  Initial deposit has to be made within 30 days of opening and $1.5k after the 60-day period to avoid fees (fees also waived for those over 62, I believe).  That one seems like a no-brainer to me.

Someone recently mentioned a 4% interest-bearing account I'd like to look into, but I can't seem to find that post again!?  Can anyone point me to that?  Anyone have some other opportunities they know about?  Can set up a direct deposit/direct payment pair if required.

How about cash in a brokerage?  Anything useful aside from something like FZDDX? Inquiring minds and all that....

I could envision (envisage?) this as a continuing thread in this climate especially!

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@racqueteer wrote:

Someone recently mentioned a 4% interest-bearing account I'd like to look into, but I can't seem to find that post again!?  Can anyone point me to that?  Anyone have some other opportunities they know about?  Can set up a direct deposit/direct payment pair if required.

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@racqueteer wrote:

Someone recently mentioned a 4% interest-bearing account I'd like to look into, but I can't seem to find that post again!?  Can anyone point me to that?  Anyone have some other opportunities they know about?  Can set up a direct deposit/direct payment pair if required.

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Frequent Contributor

Cash is T-Bills, m-mkt funds, m-mkt accounts [FDIC insured at banks], online savings accounts. These pay around 2% or under.

There are promos by some banks/credit union for high interest accounts but limited to $20-30 K and requiring direct deposits and 6+ uses per month of their ATM/credit cards.

There are some misguided people into using 4-5% yield funds as cash and they will learn a good lesson one day. They can be on merry-go-round until the music stops.

I take my RMDs in early January and invest then as necessary in taxable accounts. That is another option - not wait to take RMDs.

YBB
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@racqueteer:  The 4% interest bearing account you are inquiring about, I saw that post also, and recall that it was from a credit union, good for up to $30,000.  However, you will have to become a member of the credit union (usually a low-hurdle requirement for most these days), but more significantly you generally have to have an ongoing direct deposit and use their debit card "x" number of times a month, or other similar restrictions.  Lots of credit unions offer similar deals if you are interested, but it's not a no-strings proposition.  So far, Redneck Bank Mega Money Market (up to $50,000) and MySavingsDirect (all monies as far as I can tell) are holding at 2.4% (I have accounts with both) and they don't have any ongoing requirements.  I can recommend both, but I suspect it is only a matter of time.

 

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@yogibearbull wrote:

There are promos by some banks/credit union for high interest accounts but limited to $20-30 K and requiring direct deposits and 6+ uses per month of their ATM/credit cards.

That ($30k) is acceptable to me.  Not sure about the cards.  Haven't used them in the past; not sure I want to now.


@yogibearbull wrote:

I take my RMDs in early January and invest then as necessary in taxable accounts. That is another option - not wait to take RMDs.


I've considered that.  Frankly, I haven't come up with a good reason to do it.  Whereas NOT doing it keeps any growth non-taxable.  May be a timing consideration?  Better at a peak or a minimum?  Otoh, early, and it doesn't get lost in any confusion.  Not sure.  Your thoughts on this?

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On re-read, I may have misunderstood. I thought you were accumulating cash in tax-deferred accounts in preparation for RMDs. But I see that your taking RMDs and accumulating cash in taxable a/c are distinct things - unrelated.

As for me, I don't want to be too fancy with cash. I have enf risk elsewhere.

YBB
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My wife and I take RMDs from Vanguard in full during January and have the TIAA funds distributed equally each month.  So we have money to invest, plan or supplement on the one hand, and a monthly “allowance” on the other.

Brian

Racq - I have the same concerns about cash.  When I was little, I’d go to the toy store, cash in hand, looking to buy something to entertain myself.  I didn’t usually find anything.  My father would note that the money was “burning a hole in my pocket.” I am reminded of that now.

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@mlott1 wrote:

@racqueteer:  The 4% interest bearing account you are inquiring about, I saw that post also, and recall that it was from a credit union, good for up to $30,000.  However, you will have to become a member of the credit union (usually a low-hurdle requirement for most these days), but more significantly you generally have to have an ongoing direct deposit and use their debit card "x" number of times a month, or other similar restrictions.  Lots of credit unions offer similar deals if you are interested, but it's not a no-strings proposition.  So far, Redneck Bank Mega Money Market (up to $50,000) and MySavingsDirect (all monies as far as I can tell) are holding at 2.4% (I have accounts with both) and they don't have any ongoing requirements.  I can recommend both, but I suspect it is only a matter of time.


Thanks for that, @mlott1.  This one doesn't have the dd requirement, but it DOES have the atm/debit card requirement.  That's the part I have to look into.  4%, otoh, makes it a little less onerous to jump through a hoop or two.

On the lighter side, I'm not so sure about the "Redneck Bank" as an investment!  The images which come to mind are...interesting.  I'm picturing Daisy Duke as a teller!  :-)

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Orion FCU has a 4% checking account for $30k max.

no direct deposit necessary. i just transfer $500 from my checking every month (auto) and then auto the deposit back in to my account.
8 debit card transactions per month, which isn't hard with everyday spending.

The "hurdle" to join is a non issue.

Worth the monthly 4% for me.

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I would use it in any way you want.  Use it while the dollar is still the only major reserve currency and before the Plaza Accord is blown away in the current currency war and before the cryptos take over. The long-term future for the dollar as we know it doesn't look good as we sink more into national debt.  The world will repay us for a former Treasury secretary's famous quote that the dollar is our currency but your problem.    

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The high-rate Reward Checking Accounts (RCAs) with some tedious requirements (e.g., monthly debit card transactions) are there for a long time.  The real challenge for RCAs is the long-term sustainability for high APY.  The other factor, besides eligibility, is the number of accounts allowed (typically each account is $25K maximum for the high rate). 

I do have "a lot" of RCAs (from the same non-specified credit union) that has the same 4% APY for more than twelve years.  It took some skills to be a member there and some luck to have so many accounts and a sustainable rate.  It is not repeatable since they set the maximum of two accounts long time ago.  It is and will be my ideal vehicle for much retirement cash. 

Issues of Orion FCU RCA: (1) a minimum of $500 DD/ACH monthly - trouble for multiple account holders (what is the maximum number of accounts per social security number?), (2) $5 monthly service fee if not meeting the requirement - not a problem for a 1-2  accounts; a real problem for those who have multiple accounts with some accounts as a "placeholder" for future planning.

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@racqueteer:  If the requirements are no problem, no reason not to go for it.  4% on $30,000 (insured!) is pretty dang good, especially these days.  The credit union I use has a similar program, with a 2% rate (was 3% when I first signed up for it), but I had to do at least 15 credit transactions with my debit card each month, and that did get tedious.  Plus, I'm not a spender at all, so some months if I wasn't paying attention I would not have the minimum transaction requirement.  That's one reason I opened up the Redneck Bank Mega Money Market Account.  The only requirement was to open with an initial $50.  Nothing after that, and no monthly fees.  Like I said earlier, the rate is good up to $50,000.  If you want a laugh, go on their website (redneck.bank).  I did get a debit card, and it has their mascot (the donkey) on it.  I mentioned this account last year to my older half-brother down in Georgia, and he opened up an account with them.  He's had some fun using the debit card.  But back to the subject at hand.  Kiplinger's magazine has a page every month for the best rates for various savings, checking, CD,  and money market accounts.  There are usually some credit unions mentioned with offers of checking accounts with various interest rates.  So you might want to check out a few and see which one best suites your needs and preferences.

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this site is updated monthly for latest checking/savings/cd's/business checking rates, etc.


https://www.doctorofcredit.com/high-interest-savings-to-get/
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I don't have a lot of cash these days.  I keep things simple with it.  I accumulate IRA distributions in SPAXX.  Every 6 months I transfer $18K to DBLSX and draw from that each month to pay my gap expenses.  

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For information, one can park cash at Fidelity or Vanguard in their respective relationship banks account, instead of MM funds.

What's the advantage you ask?  FDIC Insurance!

During the 2009 financial crisis, some posters (incl me) kept funds in these accounts, and slept a little better knowing FDIC Insurance applied, which is not so for MM accounts.

Simply ask the fund family to do it, and they will arrange it.

R48

 

 

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Raqueteer, 
I might sign up if it was Daisy Duke as a teller, but more likely with a name like “Redneck Bank”, I’m thinking it will be “Granny” from the Beverly Hillbillies as a teller. 

Win
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Investors ask this question for years and my answer is always the same. NO CASH FOR ME ever before retirement and probably after retirement.  Some retirees may hold cash but not at high %.  Retirees, who watch their portfolio, know what they are doing like you and don't have high % in stocks then why cash?

Remember, all the posts we had on 01-02/2018 and everybody was excited about 2.2%, wait no I got 2.35% and...bond funds had one of the best performance.

So, if I count all the extra % my family, friends and I made over MM,CD in the last 8-9 years it's amazing.  

Wait, that's not all, you just discovered that your CD are tight and you have to wait several more months.  My money is never tight anywhere because there are always opportunities.  Example: just imagine that PCI is down 10% in the next 4-8 weeks and you buy it.

We are in a new norm of lower rates and why the old school of thinking is out.

and I'm definitely will not open several bank accounts, jump thru hoops and chase hundreds when I'm looking to make thousands.

It's also amazed me how much time and effort many spend on FDIC insurance and if one MM is a bit better and safer than the other, instead of how to make easily more money in bond funds for many years.

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FD ....  Do you have to metastasize into every thread?  You are one delusional boy.  A true genius investor at least in your own mind.  

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@retiredat48 wrote:

 

For information, one can park cash at Fidelity or Vanguard in their respective relationship banks account, instead of MM funds.

What's the advantage you ask?  FDIC Insurance!

During the 2009 financial crisis, some posters (incl me) kept funds in these accounts, and slept a little better knowing FDIC Insurance applied, which is not so for MM accounts.

Simply ask the fund family to do it, and they will arrange it.

R48


My situation is somewhat different.  The money I've been talking about is non-tax-deferred, and I'm just looking for something better than what I've been getting.  FDIC is a plus.

In tax-deferred, I'm at TDA and Wells, and I'll have to look into options for cash there.  The Vanguard and Fidelity fund options aren't viable, but maybe Wells has something along those lines?

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