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I recently opened a Fidelity account in addition to an account I have at TD Ameritrade (soon to be a Schwab account). From what I have seen for a few months, TDA seems to have a larger selection of very short term (1-3 months) brokered CDs than Fidelity. As a result, I’ve been buying short term T-Bills through Fidelity rather than brokered CDs. The T-Bill interest rate has also been higher than their brokered CDs recently. I do like that Fidelity sweeps cash into a money market account while cash at TDA earns only .40%.
Higher rate, and yes, there's a risk it will be called before the 13 months is up, and I'm willing to take that chance.
I have been looking into CD’s at Vanguard. It seems callable is worth the risk in the short term and non-callable for a lower rate but guaranteed return might be better in the longer term. I am buying within an IRA, so staying conservative with these funds.
Fidelity also has a very easy site to set up a CD ladder. The CDs in the ladder are noted on your Holdings page.
I saw that.
I like the custom choices setup and found that easy to search, sort, select, and transact, but for those who want a one-and-done approach to a bond or CD ladder, Fidelity made it super simple.
I have been looking into CD’s at Vanguard. It seems callable is worth the risk in the short term and non-callable for a lower rate but guaranteed return might be better in the longer term. I am buying within an IRA, so staying conservative with these funds.
Since I'm not committing for longer than a year, if a CD gets called after 6 months or 9 months, NBD. Easy enough to select another CD or bond thereafter.
Since I'm not committing for longer than a year, if a CD gets called after 6 months or 9 months, NBD. Easy enough to select another CD or bond thereafter.
However the main reason it would get called in would be a large drop in interest rates. Therefore the one you replace it with would likely be at a lower rate than the current non callable. That’s the trade off. Since you are talking about relatively short term CD’s I think what you’re doing is worth the risk.
I have mine in a five year ladder so I only buy non callable.
However the main reason it would get called in would be a large drop in interest rates. Therefore the one you replace it with would likely be at a lower rate than the current non callable. That’s the trade off. Since you are talking about relatively short term CD’s I think what you’re doing is worth the risk.
I have mine in a five year ladder so I only buy non callable.
However the main reason it would get called in would be a large drop in interest rates. Therefore the one you replace it with would likely be at a lower rate than the current non callable. That’s the trade off. Since you are talking about relatively short term CD’s I think what you’re doing is worth the risk.
I have mine in a five year ladder so I only buy non callable.
That was my criteria. Over 13 months, I'd opt for non-callable. This is money I'll be spending down starting in about 6 months and for 2 or so years.
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I saw that.