Credit cards, savings accounts, CDs…

[SDS]

With all of the interest rate changes, I’m looking to shuffle some things around. There are savings accounts with interest rates between 3.5 to 5%. You can get a six month CD for 5%. Cashback credit cards can be had with 2% on everything rewards.

 

Has anyone started to take advantage of this? Does anyone have a good card set up?

[muppy]

what you are mentioning here read as very smart investment strategy.

 

I'm assuming that the lower yield but guaranteed CD rate offset more volatile uncertain return in your portfolio.

 

I like the 2% rewards on credit card purchases  Travel Rewards FTW are especially appealing

 

My families strategy is to

 

#1 Pay off Credit cards and keep balance as low as possible. Credit bureaus love that

 

#2. The ideal scenario is to use any credit card. But then pay it off in full every month. Which frees money up for gain instead of paying credit card companies interest.

 

I guess it depends on your income and how many resources are realistically available at any given time

 

we have a great financial guy who manages our portfolio (and at a deep discount)  because we referred he clients in the past as well as 2 company changes in 2 years in which we followed him to the new company. I'll ask him.  Keep him on his toes type question 🙂

 

No specifics in answer to your do I have any good card set ups question today. But I hopefully will soon.  It' an interesting thought  

 

m

Edited April 24, 2023 by muppy

[SDS]

5 minutes ago, muppy said:

what you are mentioning here read as very smart investment strategy.

 

I'm assuming that the lower yield but guaranteed CD rate offset more volatile uncertain return in your portfolio.

 

I like the 2% rewards on credit card purchases will help offset the interest charges THEY charge if you keep a balance. The set up of THAT strategy I think might not work for me personally

 

My families strategy is to

 

#1 Pay off Credit cards and keep balance as low as possible. Credit bureaus love that

 

#2. The ideal scenario is to use any credit card. But then pay it off in full every month. Which frees money up for gain instead of paying credit card companies interest.

 

I guess it depends on your income and how many resources are realistically available at any given time

 

we have a great financial guy who manages our portfolio (and at a deep discount)  because we referred he clients in the past as well as 2 company changes in 2 years in which we followed him to the new company. I'll ask him.  Keep him on his toes type question 🙂

 

No specifics in answer to your do I have any good card set ups question today. But I hopefully will soon.  It' an interesting thought  

 

m

I think you misunderstood the question. I’m really talking about the different products that are out there now and if people are starting to take advantage of them. 

 

Capital one 360 performance savings account offers a 3.5% rate. Wells Fargo active cash card gives 2% back on everything, however that companies full of thieves. CIT offer is a 5% six month CD. 
 

This could mean real money compared to the 0.1% types of rates we have been getting for 10 years.

[muppy]

5 minutes ago, SDS said:

I think you misunderstood the question. I’m really talking about the different products that are out there now and if people are starting to take advantage of them. 

 

Capital one 360 performance savings account offers a 3.5% rate. Wells Fargo active cash card gives 2% back on everything, however that companies full of thieves. CIT offer is a 5% six month CD. 
 

This could mean real money compared to the 0.1% types of rates we have been getting for 10 years.

Yes well in any case  the 0.1% number is almost zero so any amount higher clearly an improvement. I'll get back to you with a better answer. And maybe you will get more informed answers from posters.

Edited April 24, 2023 by muppy

[LeviF]

CDs nuts lmao

[WhoTom]

Several years ago we opened a high-yield savings account with Citizen's Access, a fully-online bank. (It's affiliated with a brick-and-mortar bank, though, and it's FDIC insured.) At the time, the rate was 2.5%. We put most of our savings there, and then bought two five-year CDs at 3.5%. Over the first couple of years, the savings interest rate kept decreasing, reaching a low of 0.4% before rebounding. (Still a ton better than our credit union, but disappointing.) The current rate on the savings account is 4.75%.

 

Our Chase Visa card has 1% cash back on every purchase, and 5% on select purchases. The "select" category rotates every three months. In the summer, it's gasoline purchases. If you take your refund in form other than cash (Amazon gift card, etc.), then you get more money than the points would indicate.

 

If you're interested in safe long-term investments, think about an I-Bond. https://keilfp.com/blogpodcast/i-bond-rate-november-2022-may-2023/

 

[SDS]

56 minutes ago, WhoTom said:

Several years ago we opened a high-yield savings account with Citizen's Access, a fully-online bank. (It's affiliated with a brick-and-mortar bank, though, and it's FDIC insured.) At the time, the rate was 2.5%. We put most of our savings there, and then bought two five-year CDs at 3.5%. Over the first couple of years, the savings interest rate kept decreasing, reaching a low of 0.4% before rebounding. (Still a ton better than our credit union, but disappointing.) The current rate on the savings account is 4.75%.

 

Our Chase Visa card has 1% cash back on every purchase, and 5% on select purchases. The "select" category rotates every three months. In the summer, it's gasoline purchases. If you take your refund in form other than cash (Amazon gift card, etc.), then you get more money than the points would indicate.

 

If you're interested in safe long-term investments, think about an I-Bond. https://keilfp.com/blogpodcast/i-bond-rate-november-2022-may-2023/

 

not really thinking about long-term investments, just every day money management. I’ve looked at that citizens savings account. I have one now that can be converted into a much better rate at the same bank, it’s just not the absolute best right that’s out there right now.
 

I think I’m leaning towards getting one card for every day purchases at 2% and 1 or 2 more that hits groceries, restaurants, and dining. You can’t really get all three at the same time. The Wells Fargo one looks like it’s the most straightforward but I’ve been waiting to get away for that company for years after all the consumer fraud that occurred a few years ago. Citibank has a 2% card to that fits, but the Wells Fargo one has a $200 introduction offer and why would I not want $200? That’s right. Because I hate these people. Lol

[ICanSleepWhenI'mDead]

Flat 2% back on all purchases with no annual fee:

 

https://www.nerdwallet.com/reviews/credit-cards/fidelity-rewards

 

You can set up a Fidelity "cash management account" to accept the 2% cash back each month.  The cash back money doesn't need to stay in that account for any specific length of time.  You can set it up so that you can make an online transfer from the Fidelity "cash management account" to your checking account at any bank you choose whenever you want.

[Guffalo]

I am not an expert by any means, but I too have watched the various offerings from the banks and we started to try to fine tune how we were holding our cash assets. For CDs, we recently moved on from our money market accounts to take advantage of the higher rates on CDs. We have set up a ladder approach by creating a series of 3, 6 and 12 month CDs to allow for some flexibility. If rates get better, we can roll them over to new rate, whereas if it drops, the funds can be allocated elsewhere. 

 

As someone mentioned before, I bonds also seem like a great investment although you can only allocate 10K per year, But you can create various accounts for the wife and kids ( 10K each). Its a good way to put some cash away for the kids.

[Augie]

We keep excess cash at Barclay’s and transfer chunks in or out as needed. I haven’t looked at the current rates, but figure the rising tide will raise all ships, to some degree. We haven’t done anything different regarding credit cards. Chase Sapphire is the daily use card.

 

When we moved about a year ago we wanted to just pay for the house with cash. That has an enormous appeal to it. But we listened to the less emotional advisors around us and took a modest mortgage. That 30 year loan under 3% is looking pretty attractive right now. As someone recently said to me, not everybody loves their house, but a lot of people in recent years are LOVING their mortgage!  

[zevo]

11 hours ago, SDS said:

With all of the interest rate changes, I’m looking to shuffle some things around. There are savings accounts with interest rates between 3.5 to 5%. You can get a six month CD for 5%. Cashback credit cards can be had with 2% on everything rewards.

 

Has anyone started to take advantage of this? Does anyone have a good card set up?

Ive been taking advantage of offers for years. Ive opened and closed several credit cards over the years and utilizing them for their cash back bonuses when the spend criteria was met. minimal effort and have earned thousands. I've slowed down quite a bit and use a Wells Fargo active cash for unlimited 2 % for all purchases. We also use an amex blue preferred which gives up 6 % back on groceries and 3% on gas. Those have been the go to cards. As far as savings accounts go pretty much any will have 3.5% and up. I use discover savings that gives 3.75% return currently but you can do better than that.

[SDS]

2 hours ago, zevo said:

Ive been taking advantage of offers for years. Ive opened and closed several credit cards over the years and utilizing them for their cash back bonuses when the spend criteria was met. minimal effort and have earned thousands. I've slowed down quite a bit and use a Wells Fargo active cash for unlimited 2 % for all purchases. We also use an amex blue preferred which gives up 6 % back on groceries and 3% on gas. Those have been the go to cards. As far as savings accounts go pretty much any will have 3.5% and up. I use discover savings that gives 3.75% return currently but you can do better than that.

yeah. I’m looking at a bunch of the same ones you mentioned. It really looks like you need three credit cards to cover all your bases if you want to maximize your returns. Like maybe one for gas and groceries, one for restaurants, and one for everything else. the rewards can really be substantial. 

[sherpa]

I took over as Treasurer of our Volunteer Fire Dept. They were keeping their cash reserves in the checking account bank's proprietary money market fund, which was yielding about 1% at the the time, now 3%, but not competitive.

I transferred half those  reserves into a 6 month cd at 4.75% and a one year at 4.95%.

The other half of the funds, which we desired to be more liquid, I moved into the Schwab Value Advantage Money Fund, (SWVXX), which has a current yield of 4.66%, completely liquid.

 

That fund is also where I keep our personal family cash in our trading account. 

 

Yields have certainly moved up rapidly with the past many months of Fed hikes. 

[Saxum]

Banks and credit card companies know who we are.

 

We almost never have a balance on a credit card and not paid credit card interest in over 10 years with one exception and this affected my wife being able to get a credit card at PNC Bank.   I told my wife to get a credit card in her own name for security in case I am not available but they refused her for her credit profile did not match customers they were seeking since she has not carried a balance and was rejected.  When I found out this I immediately went to the bank and closed all accounts telling representative "their lending profile did not match banks we were seeking since we had over $100K in assets in bank but refused to issue her a credit card.  I received two calls after this one was bank manager who was there when I closed accounts and the other was a corporate VP trying to get me to return saying "representative did not explain correctly why we denied credit card request but we corrected issue".   PNC later merged with another "equal bank" Suntrust we had account with creating Truist but we have not closed any accounts yet. We did notice that none of the personnel from the PNC branch are working at local Truist bank branch.

 

Our exception was when bank Chase changed billing period and coincidently also did not send statement to us in time.

We immediately paid everything owed including what not owed yet but due next month for it is only interest free if you pay balance completely.

We told bank issue and that we did not know about change but they stated we still owed money on interest so we told them we were closing credit card and closed all of the liquid account (those not tied to a CD.  Amount was miniscule but the principle remains - we do not remain with financial institutions which make mistakes and fail to correct them.   

 

We paid a credit card balance with another bank once which was $10.14 cents and bank only took out $10 and sent us statement saying we owed $0.14.  We sent back to them copy of their check showing it was for full amount (before era of digital checks)  expecting them to correct it and next statement they sent us statement stating interest on the $0,14 AND a non-payment fee of $25.  We immediately went to bank, paid of credit card and non-payment fee and disputed the charges however.  Bank manager said it was put of his hands and that non-payment fee was clearly listed in plain written terms ignoring that it should have been corrected by bank.  He stated that we should have paid the $0.14 amount and then disputed it.   We closed bank account and when we did that they required us to provide written reason why so we wrote on form 'Asinine bank manager" then his name.  He stated that was not a proper response and we stated based on plain written instructions there is nothing wrong.

 

 

Currently for our "liquid assets" we use a variety of financial institutions including Discover, HSBC, M&T Bank, Capital One, Truist, Burke and Herbert as well as two credit unions Apple and Andrews FCU.   We mix short term CDs with longer term ones with minimum early termination lost of interest. Local bank branches have been closing down to save money and as HSBC and Capital One make it less convenient to bank we reduce use of those institutions.  We have found that locally best rates for CDs have been at the two credit union and have best services,  Apple CU in particular provides a financial advisor who will help with your planning even if you do not open investments with them.

 

We owe nothing on house, cars or anything else other than taxes and revolving credit card balances for more than 10 years,

 

We have rebate credit cards and I find American Express the best for they will fight for customers on lemons and I use the rebates to maintain my Hilton points.

[Saxum]

Another thing to look are Treasury I bonds.

 

https://www.treasurydirect.gov/

Rate Change Deadline: To receive the current 6.89% rate for I Bonds in TreasuryDirect, you must complete your purchase by 11:59 p.m. Eastern Time on Thursday, April 27. Learn More.

 

I Bonds:

https://www.treasurydirect.gov/savings-bonds/i-bonds/

[boyst]

Fidelity money market account drawing just under 5% interest if you got $10k to invest it's liquid vs invested. 

[Nextmanup]

On 4/24/2023 at 4:57 PM, Augie said:

We keep excess cash at Barclay’s and transfer chunks in or out as needed. I haven’t looked at the current rates, but figure the rising tide will raise all ships, to some degree. We haven’t done anything different regarding credit cards. Chase Sapphire is the daily use card.

 

When we moved about a year ago we wanted to just pay for the house with cash. That has an enormous appeal to it. But we listened to the less emotional advisors around us and took a modest mortgage. That 30 year loan under 3% is looking pretty attractive right now. As someone recently said to me, not everybody loves their house, but a lot of people in recent years are LOVING their mortgage!  

This makes sense, you would think.

But I had a savings account with Capital One that was still paying the good old .3% interest a while ago.  It began life as ING Orange and was the highest paying interest rate savings account on the planet when I opened it.

 

So I go to the Capital One website to play with my account and notice that they are doing a big push to get people to open up new savings accounts---at 3.5% interest.   I look at my account (as a long time "valued customer") and assume I am getting that new rate automatically.  NOPE! 

 

I immediately opened the new account at 3.5%, and transferred the max they would allow at account start up.  After a few days I could get the rest in there, then I closed the old account that paid .3% .

 

The rising tide may not raise all ships. 

 

I am investigating other accounts as you hear that some pay 5%.  The ones that are actually paying 4 or 4.5 or 5, and don't have strings attached, are few and far between, and tend to come from weird places I have never heard of.  Not sure I want to open those.

 

I am about to open another one at 4% though.  It's not as simple as putting all the money in 1 account that pays the highest, b/c I'm over the FDIC insurance limits and need to diversify.

 

 

[SDS]

37 minutes ago, Nextmanup said:

This makes sense, you would think.

But I had a savings account with Capital One that was still paying the good old .3% interest a while ago.  It began life as ING Orange and was the highest paying interest rate savings account on the planet when I opened it.

 

So I go to the Capital One website to play with my account and notice that they are doing a big push to get people to open up new savings accounts---at 3.5% interest.   I look at my account (as a long time "valued customer") and assume I am getting that new rate automatically.  NOPE! 

 

I immediately opened the new account at 3.5%, and transferred the max they would allow at account start up.  After a few days I could get the rest in there, then I closed the old account that paid .3% .

 

The rising tide may not raise all ships. 

 

I am investigating other accounts as you hear that some pay 5%.  The ones that are actually paying 4 or 4.5 or 5, and don't have strings attached, are few and far between, and tend to come from weird places I have never heard of.  Not sure I want to open those.

 

I am about to open another one at 4% though.  It's not as simple as putting all the money in 1 account that pays the highest, b/c I'm over the FDIC insurance limits and need to diversify.

 

 

same exact story. Started with the ING account, went to capital one, got shafted with 0.3%. Now I’m in the process of moving out. I wouldn’t have looked into this if they just gave me the 3.5% and now they will be losing all my business because because they gave me incentive to look for something else.

[Augie]

2 hours ago, Nextmanup said:

This makes sense, you would think.

But I had a savings account with Capital One that was still paying the good old .3% interest a while ago.  It began life as ING Orange and was the highest paying interest rate savings account on the planet when I opened it.

 

So I go to the Capital One website to play with my account and notice that they are doing a big push to get people to open up new savings accounts---at 3.5% interest.   I look at my account (as a long time "valued customer") and assume I am getting that new rate automatically.  NOPE! 

 

I immediately opened the new account at 3.5%, and transferred the max they would allow at account start up.  After a few days I could get the rest in there, then I closed the old account that paid .3% .

 

The rising tide may not raise all ships. 

 

I am investigating other accounts as you hear that some pay 5%.  The ones that are actually paying 4 or 4.5 or 5, and don't have strings attached, are few and far between, and tend to come from weird places I have never heard of.  Not sure I want to open those.

 

I am about to open another one at 4% though.  It's not as simple as putting all the money in 1 account that pays the highest, b/c I'm over the FDIC insurance limits and need to diversify.

 

 

 

1 hour ago, SDS said:

same exact story. Started with the ING account, went to capital one, got shafted with 0.3%. Now I’m in the process of moving out. I wouldn’t have looked into this if they just gave me the 3.5% and now they will be losing all my business because because they gave me incentive to look for something else.

 

I don’t sit in the room as they make those pricing decisions, but that sounds like an AWFUL plan to pay 0.3% in the current market. That is not just low, that is PISS ME OFF low. I looked up our Barclays account and I believe it’s paying 3.8%. (My wife handles most of the investment stuff, so I had to check.) If you are getting 4% or 4.25%, I’m OK with that. I’m not chasing every penny on a regular basis, but 0.3% in this market is how you get people to commit to never doing business with you again. Great, you made a little bit more off of me for a little while, but you lose in the long run. 

 

There is a gas station on a great corner right by my house. They routinely charge 40-70 cents/gallon more than multiple stations a mile in any direction. People fill up with gas there all day long. Again, I don’t need the BEST deal, but this feels like an insulting stupidity tax. I wouldn’t buy a bottle of water from them if I was thirsty. 

 

 

[SDS]

1 minute ago, Augie said:

 

 

I don’t sit in the room as they make those pricing decisions, but that sounds like an AWFUL plan to pay 0.3% in the current market. That is not just low, that is PISS ME OFF low. I looked up our Barclays account and I believe it’s paying 3.8%. (My wife handles most of the investment stuff, so I had to check.) If you are getting 4% or 4.25%, I’m OK with that. I’m not chasing every penny on a regular basis, but 0.3% in this market is how you get people to commit to never doing business with you again. Great, you made a little bit more off of me for a little while, but you lose in the long run. 

 

There is a gas station on a great corner right by my house. They routinely charge 40-70 cents/gallon more than multiple stations a mile in any direction. People fill up with gas there all day long. Again, I don’t need the BEST deal, but this feels like an insulting stupidity tax. I wouldn’t buy a bottle of water from them if I was thirsty. 

 

 

I doubt I would’ve made the effort to move from 3.5% to 4.75%, even if I did look into it. But it’s like if I’m going through all of the aggravation to open up a new account and then close my current one, I might as well take the best offer I can find. That is not with capital one.