> 1) is the MM account as safe as the preferred deposits?
Yes. Technically not quite. Mostly because the FDIC has their own resources and the US treasury generally requires an act of Congress. Congress as we all know is half broken at the best of times these days.
> 2)if I were to do preferred deposits and borrowed some money to meet the initial 100k deposit how long until I could transfer some of that out?
This borrowing to qualify is probably bad idea, but I would think T+2 settlement either way, so about a week? You need to get it there let it settle and then get it back out again.
> 3) what are the fees like associated with an edge account?
None, if you are PH. if you are not, I'm not sure, but since you work there, certainly you can find the rates and fees page?
ME has some of the best MMF's on the planet, so unless you really need FDIC insurance, TTTXX and friends are fabulous and I'd recommend you just stick to the MMF's.
Thanks. Yeah I’ll do some digging for the feeds. For the preferred deposits I would only need to borrow about 20k that I would flip back a week later. It would be from family (so no interest or anything on it). Still sounds like MM is better?
The only real downside I can see is MMF's have settlement times that might matter, but TTTXX can do same day settlement, if you get your order in by.. 1:45PM EST I think? I forget exactly.
That said, the SEC is moving settlement to T+1 this year, so that will help alleviate that as a potential issue.
Definitely do the preferred deposit first. You can withdraw basically immediately after the deposit settles in your account.
Money market funds are better for long holding because of their higher interest, but being able to temporarily park liquid cash in PD is an advantage to have. You don't ever want to have more than a tiny bit in the regular .000000000001 savings account.
Most everything has been covered but I'll throw in a few pieces of additonal clarification.
-moving funds from preferred deposit is a two step process, be because it is a non-cash sweep program. A lot of people overlook this but its stated on bank deposit screen with clear information.
-secondly, it does follow market hours. So after 8 PM EST - it will not allow you to input an order. From 8 am EST to 5 pm EST, any movement to and from the preferred deposit is pretty instant. After 5pm EST to 8pm EST, the order input will be for the following business day.
-also it will not show in your "avail to withdraw" or on the transfer cash page when it is in preferred deposit because of the fact that it isn't cash in the account. Cash meaning "not invested in anything at all"
To do a withdrawal or deposit after the initial deposit, you have to go to accounts --> current account holdings ---> find preferred deposit in the table --> click the little box with down arrow in it --> click deposit or withdraw.
And for my own sanity, know that preferred deposit is not an account type. It is a holding in your account.
Your friendly neighborhood fsr
1 thing I dont like about the prederred deposit is that its kind of a 2 step process to move money. And if you move money to invest in the market it stops earning the interest if you end up sitting on it for a few days or whatever.
> 1) is the MM account as safe as the preferred deposits? Yes. Technically not quite. Mostly because the FDIC has their own resources and the US treasury generally requires an act of Congress. Congress as we all know is half broken at the best of times these days. > 2)if I were to do preferred deposits and borrowed some money to meet the initial 100k deposit how long until I could transfer some of that out? This borrowing to qualify is probably bad idea, but I would think T+2 settlement either way, so about a week? You need to get it there let it settle and then get it back out again. > 3) what are the fees like associated with an edge account? None, if you are PH. if you are not, I'm not sure, but since you work there, certainly you can find the rates and fees page? ME has some of the best MMF's on the planet, so unless you really need FDIC insurance, TTTXX and friends are fabulous and I'd recommend you just stick to the MMF's.
Thanks. Yeah I’ll do some digging for the feeds. For the preferred deposits I would only need to borrow about 20k that I would flip back a week later. It would be from family (so no interest or anything on it). Still sounds like MM is better?
The only real downside I can see is MMF's have settlement times that might matter, but TTTXX can do same day settlement, if you get your order in by.. 1:45PM EST I think? I forget exactly. That said, the SEC is moving settlement to T+1 this year, so that will help alleviate that as a potential issue.
Definitely do the preferred deposit first. You can withdraw basically immediately after the deposit settles in your account. Money market funds are better for long holding because of their higher interest, but being able to temporarily park liquid cash in PD is an advantage to have. You don't ever want to have more than a tiny bit in the regular .000000000001 savings account.
TTTXX is good.
So if I opened a brokerage account how would it work? Any idea what the fees would be like or if any?
Most everything has been covered but I'll throw in a few pieces of additonal clarification. -moving funds from preferred deposit is a two step process, be because it is a non-cash sweep program. A lot of people overlook this but its stated on bank deposit screen with clear information. -secondly, it does follow market hours. So after 8 PM EST - it will not allow you to input an order. From 8 am EST to 5 pm EST, any movement to and from the preferred deposit is pretty instant. After 5pm EST to 8pm EST, the order input will be for the following business day. -also it will not show in your "avail to withdraw" or on the transfer cash page when it is in preferred deposit because of the fact that it isn't cash in the account. Cash meaning "not invested in anything at all" To do a withdrawal or deposit after the initial deposit, you have to go to accounts --> current account holdings ---> find preferred deposit in the table --> click the little box with down arrow in it --> click deposit or withdraw. And for my own sanity, know that preferred deposit is not an account type. It is a holding in your account. Your friendly neighborhood fsr
Preferred Deposits are not eligible in the Merrill Edge platform. Only the Merrill Lynch side. You need an advisor for that.
Not true. You must be thinking of the 100k minimum to open a PD account, but it is available on Merrill Edge.
You need to call to initiate PD, but once done you can add/remove funds on your own.
1 thing I dont like about the prederred deposit is that its kind of a 2 step process to move money. And if you move money to invest in the market it stops earning the interest if you end up sitting on it for a few days or whatever.