Defer interest to 2020?

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ThisWas
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Joined: Tue Sep 16, 2008 8:48 pm

Defer interest to 2020?

Post by ThisWas » Sat Jul 13, 2019 6:13 am

These forums have helped me skate near (but not over) the Affordable Care Act cliff.
I need to keep skating for 6 more months, as we're almost Medicare eligible.
Where can I invest money in July of 2019 that will pay no interest or dividends until January 1, 2020 or later?

I'm aware of individual stocks like BRK.B that currently pay neither interest nor dividends.
I wonder if there are CD, mutual fund, bond, or other investment options that I should explore.

DWNY
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Re: Defer interest to 2020?

Post by DWNY » Sat Jul 13, 2019 6:28 am

26 week tbill would do it.

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Mlm
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Re: Defer interest to 2020?

Post by Mlm » Sat Jul 13, 2019 6:29 am

Back in 2018 I purchased a 12 month CD at Ally that didn't pay interest until 2019. I believe that anything past 12 months in length pays out annually. I chose this specifically for ACA purposes.

pwrdwnsys
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Location: Ohio

Re: Defer interest to 2020?

Post by pwrdwnsys » Sat Jul 13, 2019 6:32 am

A 26-week T-bill should do the trick. Bills are sold at a discount, with all interest paid at maturity.

The next auction is Monday (7/15/2019) for issue date 7/18/2019. If my quick flip through the calendar is correct, that would mean you would receive the interest on 1/9/2020.

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welderwannabe
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Re: Defer interest to 2020?

Post by welderwannabe » Sat Jul 13, 2019 6:56 am

Mlm wrote:
Sat Jul 13, 2019 6:29 am
Back in 2018 I purchased a 12 month CD at Ally that didn't pay interest until 2019. I believe that anything past 12 months in length pays out annually. I chose this specifically for ACA purposes.
A bank can pay interest on a CD as often as it wants, but in no case can it be longer than annually per IRS rules.

In other words, a 5 year CD could pay interest daily if the bank wanted, but it could never pay it only at Maturity. At a minimum it has to disperse once a year.
I am not an investment professional, but I did stay at a Holiday Inn Express last night.

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welderwannabe
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Re: Defer interest to 2020?

Post by welderwannabe » Sat Jul 13, 2019 6:57 am

DWNY wrote:
Sat Jul 13, 2019 6:28 am
26 week tbill would do it.
+1. A 26 week or 52 week bill would be perfect.
I am not an investment professional, but I did stay at a Holiday Inn Express last night.

retiredjg
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Re: Defer interest to 2020?

Post by retiredjg » Sat Jul 13, 2019 7:39 am

I bonds?

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laughlinlvr
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Location: ID, NV

Re: Defer interest to 2020?

Post by laughlinlvr » Sat Jul 13, 2019 11:09 am

retiredjg wrote:
Sat Jul 13, 2019 7:39 am
I bonds?
+1
Investing - The hardest way to make an easy living.

Topic Author
ThisWas
Posts: 18
Joined: Tue Sep 16, 2008 8:48 pm

Re: Defer interest to 2020?

Post by ThisWas » Sat Jul 13, 2019 6:06 pm

All your answers are helpful to me!

It seems that I can buy T-bills from my Fidelity and/or Vanguard accounts, so I don't have to set up a TreasuryDirect account.

I need to invest more than $10,000, so I don't think I bonds are an option:
"In a calendar year, you can acquire: up to $10,000 in electronic I bonds in TreasuryDirect"
and current interest rates are 1.9% compared to about 2% for a 6-month T-bill.

Thanks again! I'll buy some T-bills soon.

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