Rising MMkt rate
Rising MMkt rate
Hi all,
I just discovered that CIT Bank's latest Money Market rate is 1.75%. FYI, thanks.
I just discovered that CIT Bank's latest Money Market rate is 1.75%. FYI, thanks.
- welderwannabe
- Posts: 1634
- Joined: Fri Jun 16, 2017 8:32 am
Re: Rising MMkt rate
That is a good rate. Hoping Ally raises their rates soon.
I am not an investment professional, but I did stay at a Holiday Inn Express last night.
Re: Rising MMkt rate
VG Prime MM 7 day yield 1.63%.
Why would you want the hassle of a bank?
Why would you want the hassle of a bank?
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
Re: Rising MMkt rate
Online Bank.
Click.
Click.
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee
- gmaynardkrebs
- Posts: 2339
- Joined: Sun Feb 10, 2008 10:48 am
Re: Rising MMkt rate
3 month T-Bill is 1.71% with no state tax, which means after tax will be higher in many states, especially the ones that got clobbered by the elimination of the SALT deduction.
- simplesimon
- Posts: 4578
- Joined: Mon Feb 25, 2008 7:53 pm
Re: Rising MMkt rate
VG Prime MM 7 day yield 1.63%. ?
Where have all the "why bonds" gone?
Good luck y gracias por leer / cfs
Where have all the "why bonds" gone?
Good luck y gracias por leer / cfs
~ Member of the Active Retired Force since 2014 ~
- gmaynardkrebs
- Posts: 2339
- Joined: Sun Feb 10, 2008 10:48 am
Re: Rising MMkt rate
No I didn't know and would not have cared if I did know. I have little reason to keep large amounts of cash around except for what's under the mattress.simplesimon wrote: ↑Fri Mar 23, 2018 6:53 amFDIC insurance, I guess.
As you probably know, VMMXX was recently paying the market rate of ~0% while Ally, Alliant CU, et al were paying 1%.
Many people have this fear of losing money in their short term "emergency" bucket and as a result they are forgoing better returns for very little risk. Say a 1-3 Treasury fund for example.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
Re: Rising MMkt rate
Thanks for the note. Oh, in reference to my last comment, members of "the why bonds gang" understand . . . all others please disregard. Muchas gracias por leer ~cfs~
~ Member of the Active Retired Force since 2014 ~
- willthrill81
- Posts: 32250
- Joined: Thu Jan 26, 2017 2:17 pm
- Location: USA
- Contact:
Re: Rising MMkt rate
I like Ally, but they don't move quickly when it comes to increasing their rates. From what I've seen and heard, CIT is usually the leader or really close.welderwannabe wrote: ↑Thu Mar 22, 2018 9:44 pm That is a good rate. Hoping Ally raises their rates soon.
The Sensible Steward
- simplesimon
- Posts: 4578
- Joined: Mon Feb 25, 2008 7:53 pm
Re: Rising MMkt rate
But for years VMMXX was paying almost nothing while the online banks were paying more than almost nothing.Doc wrote: ↑Fri Mar 23, 2018 8:12 amNo I didn't know and would not have cared if I did know. I have little reason to keep large amounts of cash around except for what's under the mattress.simplesimon wrote: ↑Fri Mar 23, 2018 6:53 amFDIC insurance, I guess.
As you probably know, VMMXX was recently paying the market rate of ~0% while Ally, Alliant CU, et al were paying 1%.
Many people have this fear of losing money in their short term "emergency" bucket and as a result they are forgoing better returns for very little risk. Say a 1-3 Treasury fund for example.
Re: Rising MMkt rate
Why does SALT have anything to do with it?gmaynardkrebs wrote: ↑Fri Mar 23, 2018 6:49 am3 month T-Bill is 1.71% with no state tax, which means after tax will be higher in many states, especially the ones that got clobbered by the elimination of the SALT deduction.
- gmaynardkrebs
- Posts: 2339
- Joined: Sun Feb 10, 2008 10:48 am
Re: Rising MMkt rate
If you live in a high income tax state like NY, DC, Md, etc, your effective tax rate on interest is higher now, due to the loss of the the federal deduction for state income tax.mega317 wrote: ↑Fri Mar 23, 2018 3:34 pmWhy does SALT have anything to do with it?gmaynardkrebs wrote: ↑Fri Mar 23, 2018 6:49 am3 month T-Bill is 1.71% with no state tax, which means after tax will be higher in many states, especially the ones that got clobbered by the elimination of the SALT deduction.
Re: Rising MMkt rate
That was then. This is now.simplesimon wrote: ↑Fri Mar 23, 2018 3:00 pmBut for years VMMXX was paying almost nothing while the online banks were paying more than almost nothing.Doc wrote: ↑Fri Mar 23, 2018 8:12 amNo I didn't know and would not have cared if I did know. I have little reason to keep large amounts of cash around except for what's under the mattress.simplesimon wrote: ↑Fri Mar 23, 2018 6:53 amFDIC insurance, I guess.
As you probably know, VMMXX was recently paying the market rate of ~0% while Ally, Alliant CU, et al were paying 1%.
Many people have this fear of losing money in their short term "emergency" bucket and as a result they are forgoing better returns for very little risk. Say a 1-3 Treasury fund for example.
What do we need to have a big pile of cash for anyway? Taking a little extra term risk in a bucket that we rarely or perhaps never need to use makes a lot of sense to me.
People tend to take the term "safe" too literally. And they tend to give up return just because of the fear of maybe losing a few tenths of a percent if the Fed raises the Federal funds rate by 2% is deemed not safe.
I hope all these people also drive ten MPH less than the speed limit so they can also be safe in their car.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.
Re: Rising MMkt rate
But treasuries are not taxed by the state so the effective rate is 0. Am I crazy?
- gmaynardkrebs
- Posts: 2339
- Joined: Sun Feb 10, 2008 10:48 am
Re: Rising MMkt rate
You are correct it is 0. In high tax states, bank interest is taxed at around 11%-13% for the top brackets). However, because state taxes were deductible on the federal return for non-AMT filers who itemized deductions, the effective state tax rate on non-federal interest ended up considerably lower. The end of SALT has had no impact on Federal obligations, but it has effectively increased the impact of state taxes on interest earned at banks or on corporate bonds for people who itemize deductions, making them even more disadvantaged vs T-Bills in high tax states. However, if you haven't been itemizing, and won't be anymore, obviously the loss of SALT has no impact on you.