[NA]Any good short term investments yet?[NA]

Let'sgoflying!

Let'sgoflying!

Touchdown! Greaser!
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Dave Taylor
The requirements for this are:

-very low risk. Insured is better

-flexible: see next item. Chances of withdrawing before the 1 year is minimal but at the 1yr mark I have to dump it elsewhere.

-I need to set aside 6k per month for a note that is payable each July. So the balance will never exceed 66K.

-current offerings are savings accounts 0.10%, 30 day CD 0.35%, Funds Held account with mortgager 0.50%

Is there really nothing out there?

I say 'yet' in the title. I guess I am an optimist.
 
You have to define good.

High return? Highly liquid? Very safe?

If you absolutely have to have it, an insured CD with a quality bank is a good way to go. TBills are another choice.
 
On a certain day in 2008 I was tired of the bank paying 1% on balance(s). My broker had said that something was in the wind but was unknowing as to what. We got out of stocks on the "certain day" and bought equity funds. It was a good move. At a 9.5% return(guaranteed), payable quarterly, it beats the pants off what the banks were "returning." That "certain day" was September 09; and within the following week the first fell-swoop of Wall Street occurred. And, of course, it was only the beginning of what was to come. But the 9.5%(quarterly) keeps coming, regardless of the market values of the various funds. The only bad spot was when one of the funds discontinued (temporarily) their dividends. But after the fund sold Piper Aircraft for $390,000,000(??) in cash to the foreign purchaser the dividends were restored. The arrangement surely beats the averages re stocks.

HR
 
a company claims to be FDIC insured;
How do I verify it?

Once they have my deposit;
How do I know they will not drop the insurance?
 
You can start here http://www2.fdic.gov/idasp/main_bankfind.asp

If the institution isn't listed here, they should be able to direct you to where that information would be. It could be a crime to falsely advertise FDIC insurance and not have it. ('Course, that may not matter if the bad guy has your money and you're trying to find him.)

It can be a reason to deal with people of good reputation you have known for sometime or that are referred by trusted friends. I'd stick to institutions listed on the FDIC site.

This is not something someone just drops. Even troubled institutions maintain this so there isn't a run on assets. That being said, if not a major, reputable institution, ask them that question.

Best,

Dave
 
Dave: To share some perspective: on Bloomberg today, 3 month and 6 month Treasure bills have zero yield. People are flocking to safe investments and have driven yield to none to be sure they have liquidity. One year bills yield .8%. You can usually buy these in $10,000 denomination.
Some short term money market accounts are paying just over 1% annualized. Not guaranteed, but in very short term money market instruments. Mine didn't vary in the melt down last year. I have funds at Schwab and USAA.
There just aren't a lot of alternatives for short term funds where they will be paid in over time and withdrawn within a year.

Best,

Dave
 
Well it sure isn't like 2005 but I'm getting 1.7% at Ally Bank on our liquid savings and laddering their CDs on another balance for a bit better average return.
 
This is, of course, one of the biggest reasons stocks have done so well. Just not a lot of good yield alternatives without taking risk.

Best,

Dave
 
Let'sgoflying! said:
well, I did say very low risk, and I did note the liquidity issue.
I think return is discussed too.

Let me know if you have any ideas.
Click to expand...


Well, that's just it. Are you trying to optimize all three? You're going to have to accept some risk to get return. TBills, as noted, effectively 0 risk but 0 return. As long as you stay below the FDIC limits, the bank insurance works very well. I know several people who've had CDs or savings accts at banks that have bellied-up and have gotten their money swiftly. Just make sure it is federally insured.

I would trust a CD from a federally insured institution, maybe go with the 3month option and roll-over as needed. Not as liquid as a savings account, but you should pick up yield in exchange for loss of flexibility. Thus, my question. Are you looking for highest yield? Most flexibility? Greatest safety? What's most important for you? If flexibility matters, go with the savings account. If yield matters, a 9month CD. If safety matters, go TBill.
 
I'd like to know what kind of investment pays "a 9.5% return(guaranteed), payable quarterly."

None that I'm aware of. :dunno:
 
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