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Are interest rates high enough again to make laddering worth it?
by selimthegrim 4y ago
Are interest rates high enough again to make laddering worth it?
- mlyle 4y agoNo. But if you're going to hoard cash, laddering is a slightly better way to do so.
- vasco 4y agoThat's for you to assess based on your risk profile. My answer is at the moment it's not worth it
- jacobr1 4y agoFor I-Bonds the rates are now worth it. They are very CD-like, in that you can't withdraw them for the first year, and in the first 5 there is a few month interest penalty for early withdrawal. You can only buy $10k per person per year, but as a married couple, you could build up 100K in savings over 5 years, and even faster if you hold them in a trust.
- Infernal 4y agoCan you explain why it would be faster to hold I-bonds in a trust?
- bombcar 4y agoFrom the internet: One limitation of buying I Bonds is the annual purchase limit. Each person can buy a maximum of $10,000 per calendar year as the primary owner. In addition, if you have a trust, you can buy another $10,000 per year under the name of the trust. A lawyer created a revocable living trust for us back in 2018. It was surprisingly easy when I opened an account for the trust at TreasuryDirect last month. It took only 15 minutes to open a new trust account and buy another $10,000 of I Bonds. So it lets you double the amount you can buy.
- robotresearcher 4y agoWas offered 1% for 11 month deposit yesterday. Much better than last year's 0.25%, but still, what, 1/8 of US inflation?!
- bombcar 4y agoEven less worth it when Alliant is paying 1% for a bog-standard saving account: https://www.alliantcreditunion.org/bank/high-yield-savings https://www.alliantcreditunion.org/bank/high-yield-savings
- robotresearcher 4y agoThat's relatively good. My credit union is still offering only 0.2% on >$100K. The main benefit of cash recently is losing less value each day than stocks! https://kpcu.com/Rates https://kpcu.com/Rates
- dmux 4y agoI only mentioned laddering to ease any fears of "locking everything up all at once" the OP may have had -- I hadn't considered interest rates.