Fidelity Brokered Deposits Today

Bob42 | Apr 11, 2024 | 25 posts since 2019

Fidelity 5-yr brokered deposits include 4.50 rate

Answers

txFish1 | Apr 11, 2024 | 476 posts since 2023

That is a pretty good increase as I think the best 5 year CD rates at Fidelity last week were right at 4%. The brokered CD rates usually go up (and down) in conjunction with the bond market rates so hopefully some Banks/CU's will follow suit and raise some of their mid to long term rates as well.

w00d00w | Apr 12, 2024 | 360 posts since 2012

currently can buy a 5 year treasury in the secondary market for around 4.6%. carries the same reinvestment risk as a brokered CD, but offers better liquidation terms (if needed), and an income tax break for some if held in a taxable account. when i'm looking to buy a brokered CD, i'd want a higher yield than what the similar maturity treasury is offering

Rickny | Apr 11, 2024 | 1,296 posts since 2017

It would be nice if brokered CDs had compounded intrest.

txFish1 | Apr 11, 2024 | 476 posts since 2023

Rickny I took early retirement so I mainly use Brokered CD's for some monthly income so they work for me but I see your point

Rickny | Apr 11, 2024 | 1,296 posts since 2017

Brokered CDs are similar to bonds Their price fluctuates until maturity (or if callable, called) and they payout intrest. Brokered CDs are FDIC insured.
I like Munis but the pickens are slim.

txFish1 | Apr 11, 2024 | 476 posts since 2023

I most always hold until maturity unless it is really nice gain in my favor. You are right about the Munis. I can usually find some nice Texas State GO bonds or some Texas school district AAA rated bonds that are PSF guaranteed but not so much recently

Rickny | Apr 11, 2024 | 1,296 posts since 2017

My last Muni purchases were during COVD. The bonds are MTA bonds. The MTA runs NYC subways, commuter rail lined and toll bridges and tunnels within NYC and other monies from the state and city. The MTA also collects a sales tax on the counties outside NY. I bought a bit below par between 4 and 4.25% tax free of Fed., state income taxes (you don't have state income tax). I'm in a high tax bracket so munis are very advantageous for me. Our great senior senator Shummer also got a lot of funds for the MTA to help pay for the bonds and other MTA expenses. Had 1 called already and sure the others will be too , but nice to get a few years of this income.

In NY school bonds are secured by interception of state aid. If bonds are not paid the bond holders are allowed to take school aid provided by the state to pay intrest o the bonds and capital too.
I had bonds that payed a call premium in the past. Wish that was still the case.

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