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Richard | This questin is for expert only,what'st the best saving account for ammount over 6 figues? |
also is it good idea to put that much into a saving? what would a tax like? is other good idea for a no risk safe investment? |
 |
 
kazink
 |
It all depends on what you're saving it for, if taxes are an issue and if you're concerned with guaranty of principal. If you want to stay safe and in a bank product, look for a bank that participates in the CDARS program (sounds like "cedars"). This allows you to put up to $25 million into CDs and receive FDIC protection.
If taxes are a concern, talk to your broker about ARPs, these are Auction Rate Preferred Securities, are typically AAA rated and pay tax free interest.
If the money is for retirement, you may want to sock some of it in a tax-deferred fixed annuity. These are usually principal guaranteed (check to make sure), by-pass probate, pay a competitive rate of interest (you could probably get over 7% in one right now), have a minimum guaranteed rate and no annual fees or expenses. There are early surrender charges, but they can not come out of your principal, only your interest (unlike a CD!). These are very safe and simple investments that can also pay you a lifetime of income.
All the answers about bonds are good except remember one very important thing. We are in a rising interest rate environment and people are concerned about inflation which means bond yields are going up. If you buy bonds today and have to sell prior to maturity, there is a real chance you can lose some of your principal. You can lose your money in something as safe as a US Treasury if you sell in a down market. Hope that helps. |
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Joe
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You could try Vanguard Prime Money Market Fund at 4.72%. You might do better after taxes in a tax free Money Market Fund such as the Vanguard Tax-Exempt Money Market Fund at 3.35%. You should consider putting some of your money in slightly risky investments such as a diversified stock mutual fund. You will average ~10% a year. |
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tsbr1963
 |
Over $100k?
If you want to go riskless, you need to divide that into increments of less than $100k because (assuming you are in the US) banks are insured only to $100k per account.
Second, you could buy only US Government bonds in varying maturities. This is all strictly savings type accounts. It is actually against modern portfolio theory to put all your money into one vehicle like a savings account..you are taking more risk than you realize. But, that I suppose is another issue.
If you are looking for strictly savings type accounts..buy US Government bonds or split up the money into various banks. |
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muncie birder
 |
T-bills. Do not even consider any other alternative. The interest is free from local taxes, a big advantage. The rates are reset at the end of 3 or 6 months so you are always getting the current rate. Though the U S government is not completely a safe investment, they are safer than most. You can buy them directly from the government or through a broker. |
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Irish
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You want a long term CD and you want to shop around to see who will give you the best interest rate. You can check Banks and also Mutual Funds such as Vanguard.com A variable annuity might suit you well. |
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DakineBoy
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ing account. Interest right now is 4.15%. Zero Risk withdraw at any time. |
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adamdiran
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If its an amount over 6 figures you probably Do not want a savings account!
To answer your first question. Yes its a bad idea to put that much money in a savings account. you can make it work for you and get a better return, even at no risk.
Federal bonds give better rates of return and have virtually no risk. (Safer than a bank savings account). If you have concerns about having to take money out, I'd ask about "Rolling federal bonds." Your bank will happily sell you bonds... With rolling bonds each month (or each 6 months, or each year) a certain percentage of your bonds come due, and unless you tell your bank differently they will immedietly buy new bonds. That way your money is in the bond market but you can always take your money out when some of the bonds come due.
If you were going to put it in savings (Bad idea) you should spread it across multiple banks to maxamize your FDIC Insurance. Also Look into certificates of deposit. |
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Flush
|
The answer depends on your tax situation. Bank savings accounts such as ING, certified deposits may yield 4.5% before taxes, but if you are in a high tax bracket, or living in a high tax state such as California, your real yield would be much lower.
In this case, you are better off with a tax-exempt money market, or state tax-exempt money market fund. For example, VMSXX, VCTXX from Vanguard.
Another solution is to buy T-bills. This is the safest investment anywhere. Currently, the 3-month T-bill yields 4.80%. Furthermore, unlike bank savings/CDs, T-bills are exempt from state taxes. Buy this directly from 'Treasury Direct' to avoid any fee from middlemen. |
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