Bank accounts or Vanguard/Fidelity cash accounts?

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kvdecide
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Bank accounts or Vanguard/Fidelity cash accounts?

Post by kvdecide »

Hello All:

Fidelity offers cash management accounts. They are offering all the benefits of a bank account including FDIC insurance of 1.25million*. If we use these, do we really need to maintain any bank accounts? Is there any risk in having all our cash in Fidelity cash management account? I am not seeing any risk, but wanted to check if I am missing something.

Vanguard does not seem to offer such a cash management account. They used to, but closed it.


*: I think Fidelity keeps our cash in multiple banks and hence the FDIC insurance limit is so high?
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

Fidelity cash management account is a good substitute for bank accounts. So unless you have other needs such as safe deposit box, I think a cash management account is sufficient.
Last edited by student on Thu May 19, 2022 7:19 am, edited 1 time in total.
Affable at 50
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by Affable at 50 »

I utilize Fidelity’s Cash Management Account for the majority of my checking needs. I also maintain accounts at a local bank for access to a safe deposit box and the ability to get medallion signature guarantees, certified/official checks when it is necessary.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

kvdecide wrote: Thu May 19, 2022 3:59 am Hello All:

Fidelity offers cash management accounts. They are offering all the benefits of a bank account including FDIC insurance of 1.25million*. If we use these, do we really need to maintain any bank accounts? Is there any risk in having all our cash in Fidelity cash management account? I am not seeing any risk, but wanted to check if I am missing something.

Vanguard does not seem to offer such a cash management account. They used to, but closed it.


*: I think Fidelity keeps our cash in multiple banks and hence the FDIC insurance limit is so high?
There are still certain things you can't do with these cash management accounts, like deposit cash and withdraw large amounts of cash.
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retired@50
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by retired@50 »

anon_investor wrote: Thu May 19, 2022 6:43 am
kvdecide wrote: Thu May 19, 2022 3:59 am Hello All:

Fidelity offers cash management accounts. They are offering all the benefits of a bank account including FDIC insurance of 1.25million*. If we use these, do we really need to maintain any bank accounts? Is there any risk in having all our cash in Fidelity cash management account? I am not seeing any risk, but wanted to check if I am missing something.

Vanguard does not seem to offer such a cash management account. They used to, but closed it.


*: I think Fidelity keeps our cash in multiple banks and hence the FDIC insurance limit is so high?
There are still certain things you can't do with these cash management accounts, like deposit cash and withdraw large amounts of cash.
The "large amounts of cash" issue can pop up if you are buying or selling a used car, or something along those lines. I still like to have a local bank or credit union as part of my financial picture.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

retired@50 wrote: Thu May 19, 2022 10:07 am
anon_investor wrote: Thu May 19, 2022 6:43 am
kvdecide wrote: Thu May 19, 2022 3:59 am Hello All:

Fidelity offers cash management accounts. They are offering all the benefits of a bank account including FDIC insurance of 1.25million*. If we use these, do we really need to maintain any bank accounts? Is there any risk in having all our cash in Fidelity cash management account? I am not seeing any risk, but wanted to check if I am missing something.

Vanguard does not seem to offer such a cash management account. They used to, but closed it.


*: I think Fidelity keeps our cash in multiple banks and hence the FDIC insurance limit is so high?
There are still certain things you can't do with these cash management accounts, like deposit cash and withdraw large amounts of cash.
The "large amounts of cash" issue can pop up if you are buying or selling a used car, or something along those lines. I still like to have a local bank or credit union as part of my financial picture.

Regards,
It doesn't even have to be THAT large an amount of cash. Most ATMs limit you to how much you can withdraw a day. So even if you are buying something in cash for like $2k, you might not be able to immediately withdraw it. I don't think you can get a certified check from Vanguard, not sure about Fidelity, since they have physical locations.

But I definitely keep around a brick and mortar bank. I bought a used car a few years ago, and I was able to walk in to the branch and get a certified check the same day.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 10:11 am
retired@50 wrote: Thu May 19, 2022 10:07 am
anon_investor wrote: Thu May 19, 2022 6:43 am
kvdecide wrote: Thu May 19, 2022 3:59 am Hello All:

Fidelity offers cash management accounts. They are offering all the benefits of a bank account including FDIC insurance of 1.25million*. If we use these, do we really need to maintain any bank accounts? Is there any risk in having all our cash in Fidelity cash management account? I am not seeing any risk, but wanted to check if I am missing something.

Vanguard does not seem to offer such a cash management account. They used to, but closed it.


*: I think Fidelity keeps our cash in multiple banks and hence the FDIC insurance limit is so high?
There are still certain things you can't do with these cash management accounts, like deposit cash and withdraw large amounts of cash.
The "large amounts of cash" issue can pop up if you are buying or selling a used car, or something along those lines. I still like to have a local bank or credit union as part of my financial picture.

Regards,
It doesn't even have to be THAT large an amount of cash. Most ATMs limit you to how much you can withdraw a day. So even if you are buying something in cash for like $2k, you might not be able to immediately withdraw it. I don't think you can get a certified check from Vanguard, not sure about Fidelity, since they have physical locations.

But I definitely keep around a brick and mortar bank. I bought a used car a few years ago, and I was able to walk in to the branch and get a certified check the same day.
The used car lot do not accept personal checks? I don't know whether you can get a certified check from Fidelity but you can get a cashier's check. http://personal.fidelity.com/misc/ekits ... equest.pdf In any case, I still maintain brick and mortar accounts.
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Leif
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by Leif »

For a long time my only checking was at Fidelity. A couple of years ago I opened a local bank account to get a cash bonus. I've kept the account open, with a small balance, to handle any special needs. I might at some point want to cash one of my paper Treasury I/EE bonds. They should be able to do that. I don't feel real comfortable mailing them in, although I did original get them through the mail.

Also, if I need a cashier check then they can help me. Outside of Fidelity and my local bank I have a high yield savings account. That could back me up if for some reason Fidelity was not available for a period of time.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 10:20 am
anon_investor wrote: Thu May 19, 2022 10:11 am
retired@50 wrote: Thu May 19, 2022 10:07 am
anon_investor wrote: Thu May 19, 2022 6:43 am
kvdecide wrote: Thu May 19, 2022 3:59 am Hello All:

Fidelity offers cash management accounts. They are offering all the benefits of a bank account including FDIC insurance of 1.25million*. If we use these, do we really need to maintain any bank accounts? Is there any risk in having all our cash in Fidelity cash management account? I am not seeing any risk, but wanted to check if I am missing something.

Vanguard does not seem to offer such a cash management account. They used to, but closed it.


*: I think Fidelity keeps our cash in multiple banks and hence the FDIC insurance limit is so high?
There are still certain things you can't do with these cash management accounts, like deposit cash and withdraw large amounts of cash.
The "large amounts of cash" issue can pop up if you are buying or selling a used car, or something along those lines. I still like to have a local bank or credit union as part of my financial picture.

Regards,
It doesn't even have to be THAT large an amount of cash. Most ATMs limit you to how much you can withdraw a day. So even if you are buying something in cash for like $2k, you might not be able to immediately withdraw it. I don't think you can get a certified check from Vanguard, not sure about Fidelity, since they have physical locations.

But I definitely keep around a brick and mortar bank. I bought a used car a few years ago, and I was able to walk in to the branch and get a certified check the same day.
The used car lot do not accept personal checks? I don't know whether you can get a certified check from Fidelity but you can get a cashier's check. http://personal.fidelity.com/misc/ekits ... equest.pdf In any case, I still maintain brick and mortar accounts.
Good to know you can get a cashier's check from Fidelity.
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8foot7
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by 8foot7 »

anon_investor wrote: Thu May 19, 2022 10:35 am
Good to know you can get a cashier's check from Fidelity.
Actually, at least as of three months ago, you cannot get a cashier's check from Fidelity.
https://www.reddit.com/r/fidelityinvest ... &context=3
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

8foot7 wrote: Thu May 19, 2022 10:43 am
anon_investor wrote: Thu May 19, 2022 10:35 am
Good to know you can get a cashier's check from Fidelity.
Actually, at least as of three months ago, you cannot get a cashier's check from Fidelity.
https://www.reddit.com/r/fidelityinvest ... &context=3
Interesting.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 10:45 am
8foot7 wrote: Thu May 19, 2022 10:43 am
anon_investor wrote: Thu May 19, 2022 10:35 am
Good to know you can get a cashier's check from Fidelity.
Actually, at least as of three months ago, you cannot get a cashier's check from Fidelity.
https://www.reddit.com/r/fidelityinvest ... &context=3
Interesting.
So good to have a bank with a local brick and mortar branch.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 10:52 am
student wrote: Thu May 19, 2022 10:45 am
8foot7 wrote: Thu May 19, 2022 10:43 am
anon_investor wrote: Thu May 19, 2022 10:35 am
Good to know you can get a cashier's check from Fidelity.
Actually, at least as of three months ago, you cannot get a cashier's check from Fidelity.
https://www.reddit.com/r/fidelityinvest ... &context=3
Interesting.
So good to have a bank with a local brick and mortar branch.
I still have one. I guess I am one of those old geezers who like to have a safe deposit box.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 10:57 am
anon_investor wrote: Thu May 19, 2022 10:52 am
student wrote: Thu May 19, 2022 10:45 am
8foot7 wrote: Thu May 19, 2022 10:43 am
anon_investor wrote: Thu May 19, 2022 10:35 am
Good to know you can get a cashier's check from Fidelity.
Actually, at least as of three months ago, you cannot get a cashier's check from Fidelity.
https://www.reddit.com/r/fidelityinvest ... &context=3
Interesting.
So good to have a bank with a local brick and mortar branch.
I still have one. I guess I am one of those old geezers who like to have a safe deposit box.
We have 2. BoA so we can get Platinum Honors status and a regional bank we have had an account with for a long time with a branch close to us. We get much better service at the regional bank than BoA, that is where I have gone for certified checks, and notary/signature guarantee services.
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retired@50
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by retired@50 »

anon_investor wrote: Thu May 19, 2022 11:10 am ...
We have 2. BoA so we can get Platinum Honors status and a regional bank we have had an account with for a long time with a branch close to us. We get much better service at the regional bank than BoA, that is where I have gone for certified checks, and notary/signature guarantee services.
Does the Platinum Honors include the safe deposit box for free?

I have a friend with a BofA safe deposit box, but it has an annual fee.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
hoffse
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by hoffse »

I have had a Fidelity cash account for about 10 years. I used to have a brick and mortar bank for "just in case" but eventually closed it, because it had become pointless for how I live life.

Fidelity does all the billpay things you would expect. Check writing is free and ordering checks themselves are free with free shipping. Wire transfers in are free with no limit, and wires out are free up to a pretty high limit. My husband is now paid by wire, so this is important to us. Fidelity reimburses ATM fees worldwide. I have used my Fidelity debit card in ATMs in more than a dozen countries, and they have always been reimbursed the next business day.

In the 10 years that I have had the account the only thing I have ever wanted to do that I couldn't do was deposit cash.

There were a couple times early on that I had a need to deposit cash - usually for things like group gifts, etc. - and having a B&M bank was good for that.

Then Venmo was invented, and I haven't needed to deposit cash in several years. Virtually everyone I split costs with uses Venmo or Zelle. In fact, I hardly ever use cash for anything these days except for tipping valet. Thankfully I work in a building with an ATM that dispenses $1 bills. So once or twice a year I withdraw $20 in $1 bills, and that's all the cash I carry for the year.

I've been really happy consolidating down to just Fidelity only.
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by radiowave »

While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
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student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

retired@50 wrote: Thu May 19, 2022 11:13 am
anon_investor wrote: Thu May 19, 2022 11:10 am ...
We have 2. BoA so we can get Platinum Honors status and a regional bank we have had an account with for a long time with a branch close to us. We get much better service at the regional bank than BoA, that is where I have gone for certified checks, and notary/signature guarantee services.
Does the Platinum Honors include the safe deposit box for free?

I have a friend with a BofA safe deposit box, but it has an annual fee.

Regards,
Yes. Platinum Honors includes a small one for free. Some said that they are not available at many places but I was able to get one.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
But I think it still doesn't have certain real bank services like cash deposit or cash withdrawal (other than ATM).
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by radiowave »

student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
I've seen posts here on the forum that you can't go down to your local Schwab office to deposit or withdraw cash and there are no safe deposit boxes.
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student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 12:03 pm
student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
But I think it still doesn't have certain real bank services like cash deposit or cash withdrawal (other than ATM).
radiowave wrote: Thu May 19, 2022 12:04 pm
student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
I've seen posts here on the forum that you can't go down to your local Schwab office to deposit or withdraw cash and there are no safe deposit boxes.
Yes. I think that is true. I was speaking in the sense that it is a "FDIC insured bank."
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 12:14 pm
anon_investor wrote: Thu May 19, 2022 12:03 pm
student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
But I think it still doesn't have certain real bank services like cash deposit or cash withdrawal (other than ATM).
radiowave wrote: Thu May 19, 2022 12:04 pm
student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
I've seen posts here on the forum that you can't go down to your local Schwab office to deposit or withdraw cash and there are no safe deposit boxes.
Yes. I think that is true. I was speaking in the sense that it is a "FDIC insured bank."
Yeah, basically on online bank. I heard the main benefit of a Schwab bank account is for using the ATM abroad because they do not have any foreign transaction fees and reimburse for ATM charges. I am not sure if Fidelity offers that, but most brick and mortar banks do not.
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RetirementClass2021
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by RetirementClass2021 »

I have used Fidelity as my sole bank since 2009. As other respondents have mentioned the banking
perks (free check writing, free checks, reimbursed ATM withdrawal fees, free bill pay, etc.) are great.

The main advantage for me is that my R-IRA and T-IRA are also with fidelity. This makes transfers/withdrawls between all accounts quick and easy.

In a world of electronic transfer transactions I have not had to write a check in about 10 years.
VTI 52% VXUS 13% BND 10.5% BNDX 7% SCHP 17.5% | Globally diversified low-cost passive index fund portfolio | “Forget the needle, buy the haystack.” - John C. Bogle
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

Recently Retired wrote: Thu May 19, 2022 12:21 pm I have used Fidelity as my sole bank since 2009. As other respondents have mentioned the banking
perks (free check writing, free checks, reimbursed ATM withdrawal fees, free bill pay, etc.) are great.

The main advantage for me is that my R-IRA and T-IRA are also with fidelity. This makes transfers/withdrawls between all accounts quick and easy.

In a world of electronic transfer transactions I have not had to write a check in about 10 years.
Are you doing the Fidelity one stop shop with a Fido CC?
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 12:20 pm
student wrote: Thu May 19, 2022 12:14 pm
anon_investor wrote: Thu May 19, 2022 12:03 pm
student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
But I think it still doesn't have certain real bank services like cash deposit or cash withdrawal (other than ATM).
radiowave wrote: Thu May 19, 2022 12:04 pm
student wrote: Thu May 19, 2022 11:52 am
radiowave wrote: Thu May 19, 2022 11:39 am While the Fidelity cash management account is quite good and can link to a brokerage account, I keep a brick and mortar local bank for most of my banking needs to bring coins, safe deposit box, and well the donuts of course :). Also, Schwab has a bank account as well, don't know much about it.
I think the difference is that Schwab bank is an actual bank.
I've seen posts here on the forum that you can't go down to your local Schwab office to deposit or withdraw cash and there are no safe deposit boxes.
Yes. I think that is true. I was speaking in the sense that it is a "FDIC insured bank."
Yeah, basically on online bank. I heard the main benefit of a Schwab bank account is for using the ATM abroad because they do not have any foreign transaction fees and reimburse for ATM charges. I am not sure if Fidelity offers that, but most brick and mortar banks do not.
Yes. Fidelity offers the same from cash management account, but not the brokerage account. I have both Fidelity and Schwab. I think the only difference is Schwab reimburses right away and Fidelity reimburses at the end of the statement period. At Ieast I think this was the difference when I used them round 2020.
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RetirementClass2021
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by RetirementClass2021 »

anon_investor wrote: Thu May 19, 2022 12:24 pm
Recently Retired wrote: Thu May 19, 2022 12:21 pm I have used Fidelity as my sole bank since 2009. As other respondents have mentioned the banking
perks (free check writing, free checks, reimbursed ATM withdrawal fees, free bill pay, etc.) are great.

The main advantage for me is that my R-IRA and T-IRA are also with fidelity. This makes transfers/withdrawls between all accounts quick and easy.

In a world of electronic transfer transactions I have not had to write a check in about 10 years.
Are you doing the Fidelity one stop shop with a Fido CC?
I am. The cash back every couple of months is nice.
VTI 52% VXUS 13% BND 10.5% BNDX 7% SCHP 17.5% | Globally diversified low-cost passive index fund portfolio | “Forget the needle, buy the haystack.” - John C. Bogle
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by Vanguard User »

I’ve had WF since 2003.

Does Fidelity give us access to free ATM for cash deposit/withdrawal?
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 12:28 pm
anon_investor wrote: Thu May 19, 2022 12:20 pm
student wrote: Thu May 19, 2022 12:14 pm
anon_investor wrote: Thu May 19, 2022 12:03 pm
student wrote: Thu May 19, 2022 11:52 am

I think the difference is that Schwab bank is an actual bank.
But I think it still doesn't have certain real bank services like cash deposit or cash withdrawal (other than ATM).
radiowave wrote: Thu May 19, 2022 12:04 pm
student wrote: Thu May 19, 2022 11:52 am

I think the difference is that Schwab bank is an actual bank.
I've seen posts here on the forum that you can't go down to your local Schwab office to deposit or withdraw cash and there are no safe deposit boxes.
Yes. I think that is true. I was speaking in the sense that it is a "FDIC insured bank."
Yeah, basically on online bank. I heard the main benefit of a Schwab bank account is for using the ATM abroad because they do not have any foreign transaction fees and reimburse for ATM charges. I am not sure if Fidelity offers that, but most brick and mortar banks do not.
Yes. Fidelity offers the same from cash management account, but not the brokerage account. I have both Fidelity and Schwab. I think the only difference is Schwab reimburses right away and Fidelity reimburses at the end of the statement period. At Ieast I think this was the difference when I used them round 2020.
Interesting, I might need to open up a Fidelity CMA for that benefit for a planned international trip next year. I already have a Fidelity brokerage account. Kind of disappointing that BoA doesn't offer a similar benefit even with Platinum Honors status...
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by Parkinglotracer »

I have had an Morgan chase checking account for 20+ years. It is right down the street.

There I have:
-wired a down payment and cash payment for house
-had 10+ documents notarized
-had two or three medallion guarantees done
-had a 23K cash purchase for boat deposited
-numerous large cash amounts withdrawn for a roof, boat, garage floor etc
-numerous ATM cash withdrawals

I have never paid a fee for the account

I Keep a few grand in it

I have had a few fraud alerts on the account when in tried to transfer 100K (25K a time) to a t mobile mm account

I would like an account like that where i can get some interest on the money though. I could see having a fidelity cash management account in addition if they paid 1% or more on the money there - how much do they pay?
backpacker61
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by backpacker61 »

My preference is still to maintain a banking relationship with a local brick and mortar bank, for obtaining cashier's checks (if needed), depositing a large amount of cash (I sold an old vehicle in a person-to-person transaction), and obtaining Medallion Signature Guarantees (I have needed a few over the years).

I think it's also useful to have a relationship with a bank that "knows who you are" in case you need a personal loan, or become incapacitated and a bank is required to handle your financial affairs (trust services department).

My local bank is listed in my Durable Power of Attorney to act on my behalf should my close relatives predecease me.
“Now shall I walk or shall I ride? | 'Ride,' Pleasure said; | 'Walk,' Joy replied.” | | ― W.H. Davies
increment
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by increment »

Parkinglotracer wrote: Thu May 19, 2022 12:51 pm I could see having a fidelity cash management account in addition if they paid 1% or more on the money there - how much do they pay?
They pay 0.25%. You can manually take that money and buy any of their money-market funds in order to get more than 0.3% currently, as described in the long Fidelity one-stop thread. These days you will probably have to go out of the way if you want to get more than 0.6% with a government guarantee.
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by Parkinglotracer »

increment wrote: Thu May 19, 2022 1:32 pm
Parkinglotracer wrote: Thu May 19, 2022 12:51 pm I could see having a fidelity cash management account in addition if they paid 1% or more on the money there - how much do they pay?
They pay 0.25%. You can manually take that money and buy any of their money-market funds in order to get more than 0.3% currently, as described in the long Fidelity one-stop thread. These days you will probably have to go out of the way if you want to get more than 0.6% with a government guarantee.
I have a t mobile account paying 1% fdic insured - no strings but dont think it is good for a primary checking account. I keep my retirement money that i may need in the next few years there - about 125K. I’d like to find a place to get more interest. - maybe some short term treasury securities as interest rates rise.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 12:47 pm
student wrote: Thu May 19, 2022 12:28 pm
anon_investor wrote: Thu May 19, 2022 12:20 pm
student wrote: Thu May 19, 2022 12:14 pm
anon_investor wrote: Thu May 19, 2022 12:03 pm

But I think it still doesn't have certain real bank services like cash deposit or cash withdrawal (other than ATM).
radiowave wrote: Thu May 19, 2022 12:04 pm

I've seen posts here on the forum that you can't go down to your local Schwab office to deposit or withdraw cash and there are no safe deposit boxes.
Yes. I think that is true. I was speaking in the sense that it is a "FDIC insured bank."
Yeah, basically on online bank. I heard the main benefit of a Schwab bank account is for using the ATM abroad because they do not have any foreign transaction fees and reimburse for ATM charges. I am not sure if Fidelity offers that, but most brick and mortar banks do not.
Yes. Fidelity offers the same from cash management account, but not the brokerage account. I have both Fidelity and Schwab. I think the only difference is Schwab reimburses right away and Fidelity reimburses at the end of the statement period. At Ieast I think this was the difference when I used them round 2020.
Interesting, I might need to open up a Fidelity CMA for that benefit for a planned international trip next year. I already have a Fidelity brokerage account. Kind of disappointing that BoA doesn't offer a similar benefit even with Platinum Honors status...
I think Chase Sapphire does. https://www.chase.com/personal/fees/sapphire-checking
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 1:40 pm
anon_investor wrote: Thu May 19, 2022 12:47 pm
student wrote: Thu May 19, 2022 12:28 pm
anon_investor wrote: Thu May 19, 2022 12:20 pm
student wrote: Thu May 19, 2022 12:14 pm



Yes. I think that is true. I was speaking in the sense that it is a "FDIC insured bank."
Yeah, basically on online bank. I heard the main benefit of a Schwab bank account is for using the ATM abroad because they do not have any foreign transaction fees and reimburse for ATM charges. I am not sure if Fidelity offers that, but most brick and mortar banks do not.
Yes. Fidelity offers the same from cash management account, but not the brokerage account. I have both Fidelity and Schwab. I think the only difference is Schwab reimburses right away and Fidelity reimburses at the end of the statement period. At Ieast I think this was the difference when I used them round 2020.
Interesting, I might need to open up a Fidelity CMA for that benefit for a planned international trip next year. I already have a Fidelity brokerage account. Kind of disappointing that BoA doesn't offer a similar benefit even with Platinum Honors status...
I think Chase Sapphire does. https://www.chase.com/personal/fees/sapphire-checking
Not really worth parking $75k at Chase to get benefits you can get at Fidelity for free. I park $100k at Merrill Edge in ETFs in order to get Platinum Honors status at BoA, so I can get the 75% boost to credit card cash back.
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kvdecide
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by kvdecide »

ok Thank you for all the responses.

IN terms of FDIC insurance, Fidelity is claiming 1.25 million. How are they insuring up to that amount?

Also, does Vanguard have a cash management account?
aristotelian
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by aristotelian »

Short Term Treasuries are also a possibility for Vanguard/Fidelity. Right now their rates are beating savings accounts and money market funds.
increment
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by increment »

kvdecide wrote: Thu May 19, 2022 2:01 pm IN terms of FDIC insurance, Fidelity is claiming 1.25 million. How are they insuring up to that amount?
They send your cash to some big bank. If you have more than the single-bank limit, they divide it up among several.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 1:45 pm
student wrote: Thu May 19, 2022 1:40 pm
anon_investor wrote: Thu May 19, 2022 12:47 pm
student wrote: Thu May 19, 2022 12:28 pm
anon_investor wrote: Thu May 19, 2022 12:20 pm

Yeah, basically on online bank. I heard the main benefit of a Schwab bank account is for using the ATM abroad because they do not have any foreign transaction fees and reimburse for ATM charges. I am not sure if Fidelity offers that, but most brick and mortar banks do not.
Yes. Fidelity offers the same from cash management account, but not the brokerage account. I have both Fidelity and Schwab. I think the only difference is Schwab reimburses right away and Fidelity reimburses at the end of the statement period. At Ieast I think this was the difference when I used them round 2020.
Interesting, I might need to open up a Fidelity CMA for that benefit for a planned international trip next year. I already have a Fidelity brokerage account. Kind of disappointing that BoA doesn't offer a similar benefit even with Platinum Honors status...
I think Chase Sapphire does. https://www.chase.com/personal/fees/sapphire-checking
Not really worth parking $75k at Chase to get benefits you can get at Fidelity for free. I park $100k at Merrill Edge in ETFs in order to get Platinum Honors status at BoA, so I can get the 75% boost to credit card cash back.
The money in JP Morgan Self Direct counts. I did this for a bonus. JP Morgan Self Direct is one of few places that one can buy many Vanguard funds for free. I have Platinum Honors status at BoA too (mostly for the credit card bonus).
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retired@50
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by retired@50 »

kvdecide wrote: Thu May 19, 2022 2:01 pm Also, does Vanguard have a cash management account?
I think you answered your own question in your original post when you wrote:
kvdecide wrote: Vanguard does not seem to offer such a cash management account. They used to, but closed it.
This is my understanding as well.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 3:05 pm
anon_investor wrote: Thu May 19, 2022 1:45 pm
student wrote: Thu May 19, 2022 1:40 pm
anon_investor wrote: Thu May 19, 2022 12:47 pm
student wrote: Thu May 19, 2022 12:28 pm

Yes. Fidelity offers the same from cash management account, but not the brokerage account. I have both Fidelity and Schwab. I think the only difference is Schwab reimburses right away and Fidelity reimburses at the end of the statement period. At Ieast I think this was the difference when I used them round 2020.
Interesting, I might need to open up a Fidelity CMA for that benefit for a planned international trip next year. I already have a Fidelity brokerage account. Kind of disappointing that BoA doesn't offer a similar benefit even with Platinum Honors status...
I think Chase Sapphire does. https://www.chase.com/personal/fees/sapphire-checking
Not really worth parking $75k at Chase to get benefits you can get at Fidelity for free. I park $100k at Merrill Edge in ETFs in order to get Platinum Honors status at BoA, so I can get the 75% boost to credit card cash back.
The money in JP Morgan Self Direct counts. I did this for a bonus. JP Morgan Self Direct is one of few places that one can buy many Vanguard funds for free. I have Platinum Honors status at BoA too (mostly for the credit card bonus).
Does JP Morgan Self Direct allow for SpecID cost basis for Vanguard mutual funds?
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 3:48 pm
student wrote: Thu May 19, 2022 3:05 pm
anon_investor wrote: Thu May 19, 2022 1:45 pm
student wrote: Thu May 19, 2022 1:40 pm
anon_investor wrote: Thu May 19, 2022 12:47 pm

Interesting, I might need to open up a Fidelity CMA for that benefit for a planned international trip next year. I already have a Fidelity brokerage account. Kind of disappointing that BoA doesn't offer a similar benefit even with Platinum Honors status...
I think Chase Sapphire does. https://www.chase.com/personal/fees/sapphire-checking
Not really worth parking $75k at Chase to get benefits you can get at Fidelity for free. I park $100k at Merrill Edge in ETFs in order to get Platinum Honors status at BoA, so I can get the 75% boost to credit card cash back.
The money in JP Morgan Self Direct counts. I did this for a bonus. JP Morgan Self Direct is one of few places that one can buy many Vanguard funds for free. I have Platinum Honors status at BoA too (mostly for the credit card bonus).
Does JP Morgan Self Direct allow for SpecID cost basis for Vanguard mutual funds?
My recollection is that all the lots with cost bases were transferred correctly but when I checked online recently, I no longer see them. I vaguely remember that someone on this board mentioned that you need to call them if you want to sell using SpecID. But I am not sure whether I remember correctly. So I guess I am not even willing to bet a donut on it. lol.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 3:53 pm
anon_investor wrote: Thu May 19, 2022 3:48 pm
student wrote: Thu May 19, 2022 3:05 pm
anon_investor wrote: Thu May 19, 2022 1:45 pm
student wrote: Thu May 19, 2022 1:40 pm

I think Chase Sapphire does. https://www.chase.com/personal/fees/sapphire-checking
Not really worth parking $75k at Chase to get benefits you can get at Fidelity for free. I park $100k at Merrill Edge in ETFs in order to get Platinum Honors status at BoA, so I can get the 75% boost to credit card cash back.
The money in JP Morgan Self Direct counts. I did this for a bonus. JP Morgan Self Direct is one of few places that one can buy many Vanguard funds for free. I have Platinum Honors status at BoA too (mostly for the credit card bonus).
Does JP Morgan Self Direct allow for SpecID cost basis for Vanguard mutual funds?
My recollection is that all the lots with cost bases were transferred correctly but when I checked online recently, I no longer see them. I vaguely remember that someone on this board mentioned that you need to call them if you want to sell using SpecID. But I am not sure whether I remember correctly. So I guess I am not even willing to bet a donut on it. lol.
Yuck. I converted my Vanguard mutual funds to ETFs before I transferred them to Merrill Edge. Chase just doesn't sound all that appealing since you can get the major benefits for free with a Fidelity CMA. At least with BoA you get a CC cash back boost. I think a Fidelity + BoA/Merrill Edge combo probably gets you everything you need.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 3:58 pm
student wrote: Thu May 19, 2022 3:53 pm
anon_investor wrote: Thu May 19, 2022 3:48 pm
student wrote: Thu May 19, 2022 3:05 pm
anon_investor wrote: Thu May 19, 2022 1:45 pm

Not really worth parking $75k at Chase to get benefits you can get at Fidelity for free. I park $100k at Merrill Edge in ETFs in order to get Platinum Honors status at BoA, so I can get the 75% boost to credit card cash back.
The money in JP Morgan Self Direct counts. I did this for a bonus. JP Morgan Self Direct is one of few places that one can buy many Vanguard funds for free. I have Platinum Honors status at BoA too (mostly for the credit card bonus).
Does JP Morgan Self Direct allow for SpecID cost basis for Vanguard mutual funds?
My recollection is that all the lots with cost bases were transferred correctly but when I checked online recently, I no longer see them. I vaguely remember that someone on this board mentioned that you need to call them if you want to sell using SpecID. But I am not sure whether I remember correctly. So I guess I am not even willing to bet a donut on it. lol.
Yuck. I converted my Vanguard mutual funds to ETFs before I transferred them to Merrill Edge. Chase just doesn't sound all that appealing since you can get the major benefits for free with a Fidelity CMA. At least with BoA you get a CC cash back boost. I think a Fidelity + BoA/Merrill Edge combo probably gets you everything you need.
I agree. I just couldn't resist the account bonus. BTW, it used to offer a free safe deposit box but they got rid of the benefit.
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anon_investor
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by anon_investor »

student wrote: Thu May 19, 2022 4:00 pm
anon_investor wrote: Thu May 19, 2022 3:58 pm
student wrote: Thu May 19, 2022 3:53 pm
anon_investor wrote: Thu May 19, 2022 3:48 pm
student wrote: Thu May 19, 2022 3:05 pm

The money in JP Morgan Self Direct counts. I did this for a bonus. JP Morgan Self Direct is one of few places that one can buy many Vanguard funds for free. I have Platinum Honors status at BoA too (mostly for the credit card bonus).
Does JP Morgan Self Direct allow for SpecID cost basis for Vanguard mutual funds?
My recollection is that all the lots with cost bases were transferred correctly but when I checked online recently, I no longer see them. I vaguely remember that someone on this board mentioned that you need to call them if you want to sell using SpecID. But I am not sure whether I remember correctly. So I guess I am not even willing to bet a donut on it. lol.
Yuck. I converted my Vanguard mutual funds to ETFs before I transferred them to Merrill Edge. Chase just doesn't sound all that appealing since you can get the major benefits for free with a Fidelity CMA. At least with BoA you get a CC cash back boost. I think a Fidelity + BoA/Merrill Edge combo probably gets you everything you need.
I agree. I just couldn't resist the account bonus. BTW, it used to offer a free safe deposit box but they got rid of the benefit.
If BoA/Merrill Edge ever got rid of the CC cash back boost, I would totally just transfer all my ETFs to Fidelity and close out my BoA checking. I would probabably just keep my BoA CCs though, just not use them as much.
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beyou
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by beyou »

I believe one should have 2 bank accts.

A “burner” acct for use with more risky purposes such as venmo, paypal and others where you give out your permission to transact on your checking acct.

A primary acct that pays interest, use for online bill pay and traditional paper checks.

So it’s not one or other, why must it be ?

Fidelity could be your primary, but I would keep a B&M low balance acct for other uses.
student
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by student »

anon_investor wrote: Thu May 19, 2022 4:04 pm
student wrote: Thu May 19, 2022 4:00 pm
anon_investor wrote: Thu May 19, 2022 3:58 pm
student wrote: Thu May 19, 2022 3:53 pm
anon_investor wrote: Thu May 19, 2022 3:48 pm

Does JP Morgan Self Direct allow for SpecID cost basis for Vanguard mutual funds?
My recollection is that all the lots with cost bases were transferred correctly but when I checked online recently, I no longer see them. I vaguely remember that someone on this board mentioned that you need to call them if you want to sell using SpecID. But I am not sure whether I remember correctly. So I guess I am not even willing to bet a donut on it. lol.
Yuck. I converted my Vanguard mutual funds to ETFs before I transferred them to Merrill Edge. Chase just doesn't sound all that appealing since you can get the major benefits for free with a Fidelity CMA. At least with BoA you get a CC cash back boost. I think a Fidelity + BoA/Merrill Edge combo probably gets you everything you need.
I agree. I just couldn't resist the account bonus. BTW, it used to offer a free safe deposit box but they got rid of the benefit.
If BoA/Merrill Edge ever got rid of the CC cash back boost, I would totally just transfer all my ETFs to Fidelity and close out my BoA checking. I would probabably just keep my BoA CCs though, just not use them as much.
Yes. But wait for transfer bonus. lol.
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zincTwo
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by zincTwo »

3 years ago, I spoke with a Fidelity advisor at their local branch office. They reviewed my employer 401K options. (I have a CMA, IRA's, HSA, and 401K at fidelity. I do have a checking account and safe box at a local BofA.

I asked the same question..."Do I need a brick & mortar bank?" The answer/advise was, "yes, keep an account open at brick and mortar bank. You never know when you need to handle "cash" and talk to a person face to face."

That is my plan. It is also handy when we travel, because I can get foreign currency very easily at the bank, and deposit cash on occasion.
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JoMoney
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by JoMoney »

I've needed cashiers checks on a few occasions, when I've asked Fidelity about that recently they told me "due to COVID 19" they have suspended offering cashiers checks at this time. No idea if or when they'll return to offering them, nor any clear explanation about why COVID 19 impacted the ability to get a check ¯\_(ツ)_/¯

When I needed a Medallion Signature Guarantee stamp to unlock my Treasury Direct account (in the middle of the COVID panic), Fidelity had also suspended those and other access at their branch offices. No idea if that service is available again.

I have had need to deposit cash on occasion. There's no way to do that with Fidelity.

Outside of the above, the Fidelity CMA has been a great bank-like checking account. You have the option to transfer funds from the default FDIC bank sweep into certain money market funds (like FDRXX currently has a .42% SEC yield) and can transact/debit those funds the same as if it was in the bank sweep. The Fidelity ATM card will reimburse all fees for using whatever ATMs are convenient for you. Vanguard has higher yield money market funds, but doesn't have those bank-like features to transact with the account.
If you have the Fidelity 2% cash back visa rewards credit card, its a handy account to deposit those rewards to. Personally I've stopped using that card though, I'm getting better bonuses with a different card, and the Fidelity card dropped CDW waiver for car rentals.

I like the Fidelity CMA account for most things but haven't been able to completely break away from a brick and mortar bank. FWIW, one can use the Fidelity CMA for checking and have a trivial savings or credit union "share" account with a local brick and mortar for the benefits those are good for.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
Topic Author
kvdecide
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Re: Bank accounts or Vanguard/Fidelity cash accounts?

Post by kvdecide »

JoMoney wrote: Thu May 19, 2022 9:47 pm
Outside of the above, the Fidelity CMA has been a great bank-like checking account. You have the option to transfer funds from the default FDIC bank sweep into certain money market funds (like FDRXX currently has a .42% SEC yield) and can transact/debit those funds the same as if it was in the bank sweep.
But if you invest in a money market fund like FDRXX, you are not covered by FDIC anymore. So a sweep into FDRXX is not as risk-free as a traditional FDIC insured savings bank account.

Granted, its unusual for FDRXX to breach $1 threshold.
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