Bogleheads.org

busdriver11 wrote: ↑Sun Mar 19, 2023 10:08 pm But I think if I present the risk of having over 250K there, she may be less comfortable, and be willing to change something.

Maybe present the cost of this as well . For example having $250K earning 2%, when it could be safely earning 4.5-5% in T-bills or a treasury money market fund is costing her 2.5-3% per year. That comes to $6000-$7500 per year or maybe call it $500-$600 per month. So effectively as if the $250K bank account has a $500-600 monthly fee.

Fidelity has a good auto roll system for T-bills. Vanguard has the best (cheapest) treasury money market fund. And I would say that Schwab has the best fraud protection, at least it seemed so 5 years ago based on this:
viewtopic.php?t=257429

Why do you think that is safer? I would start first by checking the “shadow NAV” of each fund. Not just me look at the outflows/inflows for these two funds today -3.3B and +2B so maybe lot more people think SNSXX is safer and I dont know what is shadow NAV :) I am guessing shadow NAV is the same as market NAV. It was $1.0001 on 3/16. Well, no. The NAV was $1.0000. That is the point. You always buy and sell at $1.0000 even when the Net Asset Value is not $1.0000. On this case it looks like the fund is slightly overfunded, which is a good sign. Schwab lists a "Market-Based NAV" of $1.0001 https://www.schwabassetmanagement.com/products/swvxx Presumably this is what the true NAV would be, if it weren't artificially held to $1. Is thi...

imbogled wrote: ↑Sun Mar 19, 2023 8:47 am

jeffyscott wrote: ↑Sun Mar 19, 2023 8:02 am I think you can find that here: http://eyebonds.info/tips/hist/tips47hista.html

If I understand correctly, that is showing a YTM of 1.96% if you bought at the first issue date and held to maturity. That would account the purchase price of $1,075.06, all coupon payments, and the value at maturity of $1,290.50.

Thanks to all for quick and helpful replies. So, for $100,000 is it as simple as multiplying 100?

I understand that things will be different for the future. I was just wondering in general how that particular time period panned out.

Multiplying by $100, would make initial principal invested about $107,500.

They auctioned at a premium to the $1000 face value. That's why real yield was negative.

Of course it would not be a bill, but there could be a coupon paying note or bond with ~1 year remaining to maturity.

Notes and bonds pay interest every 6 months, so if there were one selling for $950 with a 0.5% coupon, you would get coupon payment(s) of $2.50 and the $1000 face value (along with the final coupon payment) at maturity.

I think you can find that here: http://eyebonds.info/tips/hist/tips47hista.html

If I understand correctly, that is showing a YTM of 1.96% if you bought at the first issue date and held to maturity. That would account the purchase price of $1,075.06, all coupon payments, and the value at maturity of $1,290.50.

Why do you think that is safer? I would start first by checking the “shadow NAV” of each fund. Not just me look at the outflows/inflows for these two funds today -3.3B and +2B so maybe lot more people think SNSXX is safer and I dont know what is shadow NAV :) At the very least, maybe you're helping Schwab in their present difficulties by saving them a little bit in their interest payments. (I moved a little bit myself, after checking at their portfolios on the mutual fund comparison on the Schwab site.) Schwab gets 0.34% per year in either case, the ER is the same for SNSXX and SWVXX. The interest you get is not coming from Schwab, it is coming from the securities held by the fund, which is passed through to you (less the 0.34% ER). If any...

Schwab lets me effectively do exchanges of any mutual funds, while holding no cash (and no margin). I can do this by entering separate buy and sell orders. I also can, for example, enter an order to sell a mutual fund and then enter an order to buy a CD (again this is with no cash and no margin) with the anticipated proceeds. I can not do that on E-trade (nor Vanguard, Fidelity). Will Schwab permit me to exchange one money market fund for another without waiting for a sell to settle before making the buy? Do you mean you want to exchange one money market fund for another money market fund? If so, since money market is just a variety of mutual fund, it should be no different than any other. But, AFAIK, Schwab offers only Schwab money market...

^No COLA probably means you should strongly favor TIPS over nominals.

Your employer offering the subsidy for the 50% option is nice. It's unfortunate that they take that away if you choose the 100% survivor benefit, though. Based on the 4% discount rate figures that #cruncher posted, it appears that it would effectively cost $58,000 to buy that extra protection.

Schwab lets me effectively do exchanges of any mutual funds, while holding no cash (and no margin). I can do this by entering separate buy and sell orders. I also can, for example, enter an order to sell a mutual fund and then enter an order to buy a CD (again this is with no cash and no margin) with the anticipated proceeds. I can not do that on E-trade (nor Vanguard, Fidelity). Will Schwab permit me to exchange one money market fund for another without waiting for a sell to settle before making the buy? Do you mean you want to exchange one money market fund for another money market fund? If so, since money market is just a variety of mutual fund, it should be no different than any other. But, AFAIK, Schwab offers only Schwab money market...

It really comes down to Schwab vs E*Trade. Schwab: - doesn't have as good cash management options - mutual funds are expensive to buy - has foreign ATM and debit transactions refunds - excellent customer service E*Trade - has pretty good cash management - a lot mutual funds are free to buy and sell - does not have debit card that refunds foreign transactions and ATMs. - customer service not as top notch as Schwab To be clear, all (available) mutual funds are now free at E-trade. No transaction fees on any that they offer and also no early redemption fees. Since I prefer mutual funds, this would be a big advantage to E-trade, if I didn't have a waiver for Vanguard, Fidelity, and Dodge and Cox at Schwab (I also assume that I could probably g...

It strikes me that at a time of high inflation claiming early is not as bad as it would otherwise appear— and especially since there is no immediate COLA. ETA: obv we don’t know the inflation rate in five years so this is more of a thought experiment. FWIW, based on TIPS/nominal spread for 5 year, the market expectation is about 2.1% inflation over the next 5 years. The pension has no COLA for the first ten years based on current rules. Does that mean that if she takes it at 55, the COLAs start when she is 65, but if she waits until she is 60 the COLAs would start when she is 70? (Not that I have any idea how that would impact the decision :mrgreen: ) Even a 12% reduction is not that bad ($6k). The break even point for a 12% reduction is 8...

I highly recommend checking out freetaxusa. In 2021 I bought the offline version of H&R Block and found it so terrible that I ended up looking for other solutions. I discovered freetaxusa, which I found significantly better. The interface is far more intuitive and easier to navigate. You can check the filled in pdf tax forms at any time, so it's more clear what's actually happening as you enter data. The free cash app tax (formerly credit karma) also let's you see pdf of forms at any time. Is that not a feature of tax software that people actually pay to use? Cash app tax handled rollovers and Roth conversions for us with no issues. Free to file both federal and state. The only minor issue for me was that it has an odd way of dealing w...

I highly recommend checking out freetaxusa. In 2021 I bought the offline version of H&R Block and found it so terrible that I ended up looking for other solutions. I discovered freetaxusa, which I found significantly better. The interface is far more intuitive and easier to navigate. You can check the filled in pdf tax forms at any time, so it's more clear what's actually happening as you enter data. The free cash app tax (formerly credit karma) also let's you see pdf of forms at any time. Is that not a feature of tax software that people actually pay to use? Cash app tax handled rollovers and Roth conversions for us with no issues. Free to file both federal and state. The only minor issue for me was that it has an odd way of dealing w...

Can you actually buy an annuity that would make up the difference for less than $835 monthly difference? The 20 years of insurance doesn't seem long enough, unless it's expected that the extra money would not really needed by your spouse after 20 years.

How does your spouse feel about the prospect of managing a (larger) pile of money vs. getting a larger monthly check? Mine strongly preferred the latter, so I chose 100% survivor.

All options were supposed to be actuarially equal, except that the retiree's sex was not considered, of course. That fact meant there was a small extra benefit when a male retiree with a female spouse chose the largest survivor benefit and small penalty for the opposite due to life expectancy differences.

^Does the transaction history show the transaction being "as of" the 16th or something like that?

I've seen that sort of thing, but only with mutual funds, at Schwab a few times.

snowblinded wrote: ↑Mon Mar 13, 2023 10:05 pm Given Schwab stock is down nearly 40% in three trading days makes me wonder about their money market funds.

Why?

The money market funds are not investing in Schwab stock.

alex_686 wrote: ↑Wed Mar 15, 2023 7:59 am

jeffyscott wrote: ↑Wed Mar 15, 2023 7:52 am

alex_686 wrote: ↑Wed Mar 15, 2023 5:16 amThere is a reason why settlement periods used to be 21 days and a stock trade was $100.

You meant 100 shares, of course...a round lot.

No, I meant $100 per trade. And yeah, I worked at a full service brokerage after trade commissions were deregulated. But still, trade commissions were high because you did have to shuffle paperwork.

Oh so you were referring to the commission, not the amount of stock that could be traded.

alex_686 wrote: ↑Wed Mar 15, 2023 5:16 amThere is a reason why settlement periods used to be 21 days and a stock trade was $100.

You meant 100 shares, of course...a round lot.

You might take a look at the Vanguard Brokerage versus Mutual Fund Account Decision thread:

viewtopic.php?p=6852567#p6852567

I'm pretty sure that you can't buy a Vanguard money market fund at Fidelity (or vice versa).

The difference of 1.99% vs. 2% for taking statement credits vs. bank deposit amounts to $10 for every $100,000 charged to the card. While I do take it as a bank deposit, it's really not worth worrying about, IMO. I'd just do it whichever way seems most convenient to you.

Also earned income is not a requirement for HSA contributions:
https://www.kiplinger.com/article/insur ... n-hsa.html

The requirements are listed here: https://www.irs.gov/publications/p969#e ... 1000204025

rockstar wrote: ↑Fri Mar 10, 2023 3:53 pm FDIC has a history of paying. But banks do fail. Don’t put in more than insured. It’s not hard to put money in 1 month rolling t-bills. Of course, if the treasury defaults, it will be much worse than the GFC, so it’s a reasonable risk. SIPC doesn’t have a good history, nor is it funded like the FDIC. Pick your poison.

Not sure why companies don't do that, buy T-bills or a treasury money market fund, rather that having millions in a single bank, far beyond the $250K limit.

You can just make the contributions yourself and deduct them.

I'm not a retired fed, but am retired, collecting a pension, and deducting HSA contributions each year. For us this increases our Roth conversions as it provides a little more space in the 12% bracket.

^ Yes, only the US Treasury money fund is exempt from state income taxes.

https://www.schwabassetmanagement.com/r ... nformation

As you can see at the link, in 2022 the government money and Treasury obligations funds each got only about 20% of income from direct US government obligations. Since CA has a minimum threshold, there's no exempt income. For most states a portion would be exempt.

For those with Platinum Honors and who use the customized cash card for occasional travel, how broad is travel defined? Do Airbnb and VRBO code as travel? We don't travel much but I am looking for a card with better travel cash back benefits than our US Bank Altitude Connect. No AF would be nice! Not what you asked, but I recently used a Citi Costco card for a VRBO deposit and it was categorized as hotel/lodging and earned 3%. Part of the charge came directly from Vacasa and that also qualified for 3%. I would assume if they are hotels/lodging for one Visa they are that for all. (Immediately after I had used that card without thinking about it much, I'd thought it was a mistake as I think VRBO and similar had not earned 3% for previous pur...

martha wrote: ↑Thu Mar 09, 2023 8:44 pmWe will be moving a VOYA 401k to a Fidelity Rollover IRA -- so two different custodians.

You might want to check into doing the rollover at Voya and then transferring the IRA to Fidelity. Doing it that way, you may be able to avoid being out of the market (and also avoid the mailing around of checks).

My spouse did that with T. Rowe and Schwab. Rolled to IRA at T. Rowe and then as soon as that was done, she transferred the IRA in-kind to Schwab (with a bonus).

^Ah, US Cellular, the forgotten network operator. I guess with Sprint gone, they now operate the 4th largest network in the US.

I bought some of the 2053 TIPS at auction in mid Feb and am looking to add some more. Now that they have settled on 2/28/23, I do see them on Fidelity secondary market. However, for the past 2 days, I've seen very limited bids/asks with only quantity of 50 or 75. Does it generally take time for the depth of book to fill in like the rest of the TIPS? That's a great question. Market is closed, but what I see now is no depth of book at all. Just min qty 50. Let's take a look tomorrow. Looks like Vanguard and Fidelity have a pretty shallow book right now, with min quantities of 50. Schwab is much better, offering the almost ask price for min-quantity of 1, and a better bid price. Yes, the Schwab price difference for 1 vs. 50 is so small it's a...

^ Regarding that choice, I found an email from last Oct that says, in part:

You chose to receive your Settlement payment via check. The Settlement Administrator can now offer you the ability to receive your payment electronically via PayPal or pre-paid card. If you would like to switch your payment selection to electronic payment via PayPal or pre-paid card rather than a physical check, please click here.

If you do not want to change your payment selection of check, you do not need to do anything. If we don’t hear from you by October 14, 2022, your payment will be sent to you by check.

^Thanks for explaining why closing only the mutual fund door wouldn't work.

Obviously, I have learned that in the future, remove ALL payment methods from PayPal except for the one you want to use. Yes, and the last few times I switched cards, there was an additional annoying step to take, removing "pay with points", which PayPal had automatically enabled. I got an offer from Citi to get 5% via PayPal. I clicked to enable that, but then realized it'll require too much adding and removing of cards to be worth bothering with unless we have a large purchase (I already get 5% on utility payments with US Bank). We're spending a few hundred at Home Depot and Lowes this quarter, but since Chase and Discover are 5% on groceries, Custom Cash is giving me 5% at home improvement stores, without the need to involve P...

Schwab Value Advantage Money Fund® – Investor Shares (SWVXX) 4.48% yield 0.34% ER Schwab Government Money Fund – Investor Shares (SNVXX) 4.16% yield 0.34% ER Schwab Treasury Obligations Money Fund – Investor Shares (SNOXX) 4.26% yield 0.34% ER Schwab U.S. Treasury Money Fund – Investor Shares (SNSXX) 4.07% yield 0.34% ER Schwab U.S. Treasury Money Fund – Ultra Shares (SUTXX) 4.22% yield 0.34% ER What is the risk of the prime vs Gov't MM? I know Gov't is more heavily in tbills...but what is my real risk vs. prime? Very high? From my reading SNSXX seemed the safest as most heavily tbills. It's a shame those expense ratios are so high. I hear they are lower on Vanguard MM funds, but my investments are all at Schwab. I'm looking for immediate ...

He notes, there is one fund company that has filed with the SEC to register funds with this structure. The SEC has not approved the registration yet. Interesting that the application is for actively managed funds. Besides the SEC maybe being more reluctant to approve for managed funds, the article mentions another issue: Mutual funds have the option to close their doors to new investors as the fund grows and its ability to outperform its benchmark erodes. Adding an ETF share class forfeits that option because ETFs don’t possess a mechanism to prevent new money from entering. I wonder if they still could close the mutual fund, even though that would not stop money from coming in via the ETF? Wouldn't that at least stop individuals from addi...

... And, as a tie breaker if nothing else, you can look at the actual allocations. According to M*, VPGDX has (net) U.S. Equity at 35% and Non-U.S. Equity at 25.5%, this is nearly identical to VSMGX (Moderate Growth) with U.S. Equity at 35.5% and Non-U.S. Equity at 24%... Ah, but fans of the fund when it was still Managed Payout often objected to characterizing it by percentage of stocks as stated by Vanguard, on the grounds that some of it's component funds included short positions on stocks that ought to be subtracted, and that the low correlations of its components meant the that actual risk we much lower than an indicated by percentage of stocks. But I'm just being argumentative, of course. Morningstar shows the short positions and sub...

TLC wrote: ↑Thu Feb 16, 2023 12:42 pm

tonyclifton wrote: ↑Thu Feb 16, 2023 11:59 am At Schwab I must write checks from a checking account which is a different account than the brokerage account where the money market fund is held.

I have a Schwab One account with a debit card for ATM withdrawals, direct deposit for my paychecks, their bill pay service, and write checks against it. I do not have a linked Investor Checking account with them. I use SWVXX and routinely buy/sell enough to satisfy my cash flow needs for the services above. I wish they still had an auto-sweep product.

If you can only use the brokerage sweep account for those things, there doesn't seem to be any advantage over having and using the checking account. Both have similar, low interest rates.

Freeadvice wrote: ↑Thu Feb 16, 2023 12:13 pm Does SNOXX avoid state and local taxes?

https://www.schwabassetmanagement.com/r ... nformation

Treasury obligations apparently earned most income from repurchase agreements last year. Only 18% was potentially exempt, depending on your state rules.

The US Treasury money fund was 100% exempt.

Also use SWVXX, but keep very little cash only about $4-5K currently.

In IRA, I use short term bond index, CDs, Treasuries, and TIPS in place of actual cash. Since I'm old, I could access IRA moneys should SWVXX ever be locked up.

If I were going to have a substantial sum in a money market there, I would probably use one of the others. State tax is 5.x%, so the after-tax yield difference between them is not much.

IslandTime wrote: ↑Thu Feb 16, 2023 8:13 amSchwab U.S. Treasury Money Fund – Ultra Shares (SUTXX) 4.22% yield 0.34% ER

ER is actually 0.19% for that one, but it requires $1 million. They also have ultra versions of the others, with lower ERs, for those who have $1 million or more in cash: https://www.schwab.com/money-market-funds

Merging VPGDF, the "Vanguard Managed Allocation," previously "Managed Payout" fund, though, seems precipitous and inconsiderate. To begin with, I would have thought that a $1.2 billion fund would be big enough to merit continuation. For another... another weird detail... I'd have thought that it was a better match for the LifeStrategy Conservative Growth fund than for the Moderate Growth fund. Although I guess that's in the eye of the beholder. Well as another beholder, the charts look to me like it depends on what period you focus on. But, if you look at the std dev. and max drawdown, the moderate fund seems to me to be a much better match to the risk level of Managed Allocation. And, as a tie breaker if nothing else, ...

In the end, TIPS do not change their nature due to being owned by a fund. Whatever complexity there is around distributions, NAV changes, and SEC yield, the 0-5 or 1-5 year TIPS funds will earn the real yields of those TIPS, less the ER.

You can get about 2% real on some of those that mature in the next 2 years. For the funds I think #cruncher's yield (less the ER) is a better indicator than SEC's:
viewtopic.php?p=7095152#p7095152

One factor affecting the fund distributions is that they include the inflation adjustment. This would also affect reported SEC yield for funds that calculate it based on those distributions, rather than reporting it as a real yield (which Vanguard does).

Thanks for confirming the suspicion that these are not really of any use to individuals.

billaster wrote: ↑Sun Feb 12, 2023 8:47 pmThe $20 they paid back to you should be probably be treated as a brokerage bonus and is taxable.

It's just a refund of a $20 charge, why would you think that's taxable?

protagonist wrote: ↑Sat Feb 11, 2023 7:05 pm (The figure for 100 or more at Schwab was not included in Kevin's post.)

It would have been the same price for 100 as for 1 at Schwab.

As Kevin said, "Schwab has the best pricing for min quantity 1 for all the TIPS I looked at". That means that the lowest price quote on Schwab required buying just 1.

The price quotes for TIPS do not include the inflation adjustment. So 1 can be significantly more than $1000 for some TIPS. There's a couple that currently have inflation adjusted principle of $1800+, so buying one of those would cost about $1800 if price were about 100.

NiceUnparticularMan wrote: ↑Sat Feb 11, 2023 8:44 am Indeed, for that matter you can look at the very end of the graph. We're still inverted, but since the inversion period started, 10-year bond rates have gone down, and 10-year bond prices have gone up.

And 3 months ago, if seeing that inverted curve led you to buy a 3 month Treasury with money that you'd otherwise have invested in total bond, you'd have gained about 1.1% over those 3 months (one quarter of the ~4.3% yield available in mid-November). Meanwhile, an investment in total bond would've gained 2.87% in the past 3 months.

Besides sign-up bonuses, the US Bank cash+ card allows you to select two 5% categories. Two of the choices are home improvements and furniture stores. Limit is $2000 per quarter, so $100. There might be a $200 sign-up bonus, as well. That doesn't seem like a good value for the OP unless they are planning to spread out their purchases over several years. Seems like a lot of effort for $100. You have a point but that US Bank card is great for utilities as it's the only card I know of that one can get 5% cash back on utilities. Right there could be a different category or two that make it worth using after the new house related spending. Streaming is another choice for 5%. You do have to choose your categories each quarter, even if not changi...

Prior to age 62, I was open to the possibility of just taking it at 62 (if SS were still available when, and if, I even got there). So I made sure to have all my Roth conversions out of the way, just in case. But once I got to 62 and could now take SS anytime I wanted, my strategy mostly became "Not today. Just let it grow since you don't need the income, it will just raise your taxes, I have little interest in putting it into stocks, it will be frozen at that set amount for the rest of your life, etc." Plus, if things suddenly changed like the future of SS started looking shaky and new laws were being discussed that would adversely affect MY unique situation, or if some health issue were to come up, I could always just file at t...

Lemonaid56 wrote: ↑Fri Feb 10, 2023 7:55 am There are expense ratios tied to them that don't exist in SPAXX so doesn't that make your "cash" decrease?

SPAXX has an ER of 0.42%, which is the same as that for SPRXX and higher than that for FZDXX. In any case, the yields already accounts for the ERs.

* While there are "no fees" associated with VG (and presumably other) funds, E*Trade does (unless changed in last months) levy an Early Redemption Fee to discourage short term trading, on any shares sold within 90 days of purchase. I don't churn my accounts, but didn't want to have a disincentive to sell when needed or wanted. This fee does NOT apply to ETFs. Then there is also the issue of moving things between brokerages, which I have yet to do but understand works better with ETFs (if it even works at all with MFs). I'd skip mutual funds and work with ETF equivalents. *Perhaps it was the relative size of initial transfer, but I was hooked up with a personal rep (in my state, but not my town). He has been very helpful in naviga...

Besides sign-up bonuses, the US Bank cash+ card allows you to select two 5% categories. Two of the choices are home improvements and furniture stores.

Limit is $2000 per quarter, so $100. There might be a $200 sign-up bonus, as well.

I figure and anyone can correct me if I’m wrong; is if my finances are solid enough to last till 70, I have a family history of good health/longevity well past average death rates, it is probably in my best interest as being the older higher earner spouse to wait till 70. That is even if the calculator may say a year or two earlier is best. Also, in my experience people with higher income and higher savings tend to be healthier compared to average because they have the finances to eat healthier, afford their medications, afford to see doctors timely, and afford gym memberships or other activities that promote improved health. I would wager that the members of this forum will live longer than actuarial averages of social security. When you ...