simplifying my financial life -- should i get rid of treasury direct?

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emlowe
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by emlowe »

Did you mean you had E bonds, or EE bonds?

E bonds stopped paying interest a long time ago (I think in 2010). They were last sold in 1980.

EE bonds pay very little annually (pretty close to zero recently) - however, they are guaranteed to double after 20 years. So basically at year 20, they suddenly turn into a (yearly) yield of 3.5%.

This makes EE bonds quite a curious investment; held for 20 years they are pretty good, 3.5% completely risk-free. Before 20 years, however, they are pretty much the equivalent of a mattress (the last time the yearly rate was more than 1% was 2011 and the last time it was more than 1.5% was 2007 - the rate is current 0.1%).

I think I-Bonds can serve several purposes in a portfolio - your Emergency fund is one popular reason.

Seeing as you can buy just about every other form of treasury using a brokerage (eg. Fidelity, etc), it really is a shame you can't do the same with savings bonds.
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anoop
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by anoop »

emlowe wrote: Sun Mar 03, 2019 4:45 pm Did you mean you had E bonds, or EE bonds?
EE
dbr
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by dbr »

I bailed on TD. The proverbial straw was when they mailed out that plastic code card you needed to get into the account.

If we had a pile of 3% I bonds there it would be different, but we didn't.
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emlowe
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by emlowe »

That plastic card didn't last long though - you don't need it anymore. That was ditched in 2011 from what I can tell.

I wish they would ditch the dumb web keyboard thing - it's easily overridden by using some simple scripts, and offers no additional security that I can think of.

If they introduced 2FA using any standard 2FA tool (Google Authenticator, Lastpass, Symantec VIP) that would improve security.
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smectym
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by smectym »

"Re: simplifying my financial life -- should i get rid of treasury direct?
Unread post by fipt2030 » Wed Mar 14, 2018 4:03 pm

Wow, is that such a big hassle dealing with TD
I am 20 yrs (hopefully) from retirement and just started buying both Saving bonds for both of us, to diversify our bond holdings.
In 20 years they could be 20% of our portfolio, and happy with their place to meet our needs in 20 years

What am I missing"

I respect the concerns of those who have trouble with TD, but I wouldn't follow their lead.

When I review the savings bonds I have on there I realize they're just about all well above current market rates, plus federal tax deferred and state tax free.

It's regrettable that Treasury quit marketing savings bonds and discontinued paper bonds, true. But that doesn't negate the unique features of savings bonds and the key role they can play in a portfolio.

Also, TD is a great place to buy other treasury securities. And come on, the site isn't THAT hard to navigate.

As to estate issues, the holdings on TD can be assigned "POD" beneficiaries just like a bank account or brokerage account. No probate.

Smectym
MrJones
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by MrJones »

anoop wrote: Thu Mar 15, 2018 11:41 pm What do you do if you, say, sell a car and need to deposit cash?
Money order + online deposit. Worth the time and couple bucks in fees for one-time rare events.
EZ James
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by EZ James »

I am also single and doing this for my heir but it's costing me a lot to do so.

I have gone from 9 banks and two credit unions plus Vanguard to two banks, one credit union and Vanguard. Everything is titled POD except for one local bank which can be tapped for probate expenses.

I have a house that I might set up for TOD but this is rather involved and requires further cogitation.

I have some I-bonds in a SDB at the local bank and they have advised me I can cash them anytime. If I think my time on this planet is about up hopefully I will be able to cash them so she doesn't have to deal with the problem.

I also have a TSP account which I am trying to roll into an IRA at Vanguard,

My Legacy TD account was zeroed out a dozen years ago and I want nothing to do with government accounts going forward,

For treasuries I set up a 6 month ladder with weekly rungs at Vanguard and buy every week at auction.

My heir is quite naive and I figured she could not handle the stocks and one ETF at Vanguard so I sold them and incurred large cap gains.

Since then I have come to realize that she won't even be able to manage the MFs at Vanguard so those sales were for naught. She will never be computer literate and will have to do transactions by phone or maybe hire their advisor service.

I agree simplicity may trump returns at some point for some of us.
dcabler
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by dcabler »

J295 wrote: Wed Mar 14, 2018 9:21 am I think I’m lucky… Buying I bonds in the past has been a breeze on Treasury Direct. Personally, they have a role in our portfolio so I’m keeping them in place.
Same here. Pretty easy. Yeah, the TD interface is a bit odd, compared to just about anything else I do on the web. Filled up my tax advantaged space and this is a place where both of us can add a little every year with Ibonds. The only thing that's painful, if you can call it that, is dealing with paper bonds if you use your tax refund to purchase Ibonds. When you send them into TD to convert them to electronic form, TD puts them in their own special place in your account. Again, odd, but not really painful. Yeah, they don't earn much above inflation, but that's OK - eventually we'll use them after we turn 70 as an inflation adjusted supplement to SS.
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happymob
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by happymob »

randomizer wrote: Wed Mar 14, 2018 1:27 amI personally didn't bother holding individual treasuries until recently, and I can see myself living without them in the future.
I originally opened a Treasury Direct account primarily to buy TIPS at auction. Then I found out I could do this on Fidelity easily. Then Vanguard offered the same on their platform. So Treasury Direct became superfluous, other than holding I Bonds.

We qualify for the education tax deduction on I Bond interest now and looking at the math, we may not in 10 years when the kids will be going to college, so we decided to cash out our I Bonds now (well, over 3 years) and transfer the money to 529 plans to get tax-free interest now and a 2x state tax deductions (we can take a single contribution off of both our KS and OK state returns). Simplification plus maximizing tax benefits.
HomeStretch
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by HomeStretch »

dcabler wrote: Mon Mar 04, 2019 7:24 am The only thing that's painful, if you can call it that, is dealing with paper bonds if you use your tax refund to purchase Ibonds. When you send them into TD to convert them to electronic form, TD puts them in their own special place in your account. Again, odd, but not really painful.
I merged my TD conversion account that held my converted paper bonds into the main account with my electronic bonds per user tibbitts post in the BH thread, below. Now all bonds are together. viewtopic.php?f=2&t=198737&newpost=3039450
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aj76er
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by aj76er »

MrJones wrote: Mon Mar 04, 2019 2:41 am
anoop wrote: Thu Mar 15, 2018 11:41 pm What do you do if you, say, sell a car and need to deposit cash?
Money order + online deposit. Worth the time and couple bucks in fees for one-time rare events.
If you have a capital one 360 account (checking), then you can now use a capital one cafe to deposit cash. They have automated bill counters built into the ATM machines there. I just tried doing it this weekend and it went through instantly (the cash showed up in my account instantly and was available to spend). They told me that there are about 30 of the cafes around the country (I'm guessing in major metro areas).
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by Broken Man 1999 »

I closed our TD account last year as interest rates on the savings bonds held there were low. Also holding total was small (< $15,000).

The 1099 form was available in January, amounts were correct, so I'm good with that account.

Not sure why TD website is often the subject of negative experiences. I never found it difficult to navigate, or to easily conduct my activities. I never used the option to have my PC registered, so I always needed a onetime code to sign in. The onetime codes were always waiting in my email account when I went to it to retrieve them. No wait time.

Over the years I had to call TD one time when I lost my card needed to sign-in. I was quickly connected to someone who could help, and a new card was delivered promptly. Of course a couple of days after receiving my new card I found the old one.

For what it is worth, here is their poll of users taking the time to answer after they log off:

TreasuryDirect® Survey Results
Thank you for completing our survey. Your feedback is very important to us, as we work to improve our services. The results shown below are for the last 30 days and include your score. Due to rounding, the numbers below may not add to 100. Also, some of the numbers may be 0 because of either rounding or small sample size. If you'd like to provide more specific comments, please e-mail us.


TreasuryDirect
Excellent 71%
Good 22%
Fair 4%
Poor 3%
Freedom of Information Act|Law & Guidance|Privacy & Legal Notices|Webs


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BogleMelon
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by BogleMelon »

I had I bonds before, but for simplifying purposes I have sold them (except few, because of the 1 year rule restriction) and moved the money to Ally saving
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dcabler
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by dcabler »

HomeStretch wrote: Mon Mar 04, 2019 9:22 am
dcabler wrote: Mon Mar 04, 2019 7:24 am The only thing that's painful, if you can call it that, is dealing with paper bonds if you use your tax refund to purchase Ibonds. When you send them into TD to convert them to electronic form, TD puts them in their own special place in your account. Again, odd, but not really painful.
I merged my TD conversion account that held my converted paper bonds into the main account with my electronic bonds per user tibbitts post in the BH thread, below. Now all bonds are together. viewtopic.php?f=2&t=198737&newpost=3039450
Awesome! Thanks for the pointer. Guess I know what I'm doing next time I log into TD. :sharebeer
AnonJohn
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by AnonJohn »

emlowe wrote: Sun Mar 03, 2019 5:53 pm That plastic card didn't last long though - you don't need it anymore. That was ditched in 2011 from what I can tell.

I wish they would ditch the dumb web keyboard thing - it's easily overridden by using some simple scripts, and offers no additional security that I can think of.

If they introduced 2FA using any standard 2FA tool (Google Authenticator, Lastpass, Symantec VIP) that would improve security.
Could you recommend a script? My randomly generated 20 character password makes me hate that keyboard beyond words ... I guess it provides some protection against EM sniffing of keyboards, but ... that's not really on my list of concerns. As you say 2FA is what they need ...
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emlowe
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by emlowe »

AnonJohn wrote: Mon Mar 04, 2019 12:11 pm
emlowe wrote: Sun Mar 03, 2019 5:53 pm That plastic card didn't last long though - you don't need it anymore. That was ditched in 2011 from what I can tell.

I wish they would ditch the dumb web keyboard thing - it's easily overridden by using some simple scripts, and offers no additional security that I can think of.

If they introduced 2FA using any standard 2FA tool (Google Authenticator, Lastpass, Symantec VIP) that would improve security.
Could you recommend a script? My randomly generated 20 character password makes me hate that keyboard beyond words ... I guess it provides some protection against EM sniffing of keyboards, but ... that's not really on my list of concerns. As you say 2FA is what they need ...
I'll PM you
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mptfan
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by mptfan »

anoop wrote: Wed Mar 14, 2018 12:53 am Have any of you guys chosen to close your TD account and liquidate all the I/E bonds?
Yes, I did.
Quaestner
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by Quaestner »

In a quick look over of responses, I didn't notice anyone reminding you that the EE-bonds, while having an absurdly low rate, do have the special feature of DOUBLING in value after 20 years! I'm not sure how long you've owned these, but that 20 year doubling is equal to more than a 3.5% tax deferred return. If you just bought these a year, or three ago, so what - sell them. But if I bought these 5 or more years ago I'd hold them (and that admittedly irksome TD account) until they hit 20 years. If you bought them, for example, 7 years ago, could you really find an equally safe investment that would double in value in 13 years?
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anoop
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by anoop »

Quaestner wrote: Mon Mar 04, 2019 6:29 pm In a quick look over of responses, I didn't notice anyone reminding you that the EE-bonds, while having an absurdly low rate, do have the special feature of DOUBLING in value after 20 years! I'm not sure how long you've owned these, but that 20 year doubling is equal to more than a 3.5% tax deferred return. If you just bought these a year, or three ago, so what - sell them. But if I bought these 5 or more years ago I'd hold them (and that admittedly irksome TD account) until they hit 20 years. If you bought them, for example, 7 years ago, could you really find an equally safe investment that would double in value in 13 years?
That was the reason I originally bought them and only started doing so a couple of years ago, but because of health challenges, planning that far out is no longer a priority for me (single, no dependents).

If rates go up, EEs will start to look pretty bad (aside from the tax advantage, but I'm not so sure that is an advantage if tax rates go up which I think is likely to be the case). Some agency debt will get better returns.
smectym
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by smectym »

Quaestner wrote: Mon Mar 04, 2019 6:29 pm In a quick look over of responses, I didn't notice anyone reminding you that the EE-bonds, while having an absurdly low rate, do have the special feature of DOUBLING in value after 20 years! I'm not sure how long you've owned these, but that 20 year doubling is equal to more than a 3.5% tax deferred return. If you just bought these a year, or three ago, so what - sell them. But if I bought these 5 or more years ago I'd hold them (and that admittedly irksome TD account) until they hit 20 years. If you bought them, for example, 7 years ago, could you really find an equally safe investment that would double in value in 13 years?
Good point. we have quite a few that double in 17 years--several in 2019. It would be a mistake to sell these early under the flag of "simplifying my financial life."

Treasury Direct is a bit of an odd duck, no question. The criticisms raised above are not without merit. But by now we've figured out the quirks, and we'll stick with TD.
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by yogesh »

TreasureDirect is an example of "security by obscurity". My wife would never login to such site so I simplified by selling everything in TD and moving all assets to one brokerage firm for checking/saving/emergency, credit card, brokerage, 401k as four accounts for life. Everything is set on auto-pilot. My RSU's can't be auto-sold on deposit so I showed her how to "Sell all shares" and "by more" into index fund as 3 min activity per year and that itself wasn't appreciated so talk about dealing with TD. My "hit bus" plan is that my CPA/CFA can help her "stay the course" and use as much automation as possible.
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Taylor Larimore
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Simplicity. My safe is unlocked!

Post by Taylor Larimore »

Bogleheads:

For most of my life my wife and I had both a safety deposit box at the bank and a small combination safe at home. They were an expensive nuisance. My wife died May 10, 2013 after 62 years of marriage.

I sold or gave away her jewelry, and I ended the safe-deposit box expense.

I own no jewelry so the fire-resistant safe contains only personal papers and is unlocked. I no longer must remember the combination and my heirs will thank me.

Simplicity is great -- at home and with investments.
Our life is frittered away with detail. Simplify. Simplify. -- Henry David Thoreau.
Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle
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anoop
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Re: simplifying my financial life -- should i get rid of treasury direct?

Post by anoop »

AnonJohn wrote: Mon Mar 04, 2019 12:11 pm As you say 2FA is what they need ...
Don't they already have 2FA? I used to get emailed a OTP (one time passcode) each time I tried to get in, before being prompted for my password.
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