Comments on: T-Bill Investment Rate: Is it APR or APY? And What Is Your Taxable Equivalent Yield? http://www.thesunsfinancialdiary.com/investing/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/ Fri, 03 Feb 2012 17:42:24 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Sunhttp://www.thesunsfinancialdiary.com/investing/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-36023 Sun Thu, 24 Jan 2008 03:28:54 +0000 http://www.thesunsfinancialdiary.com/2006/11/06/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-36023 Steve: To consider whether investing in T-bills still makes sense to you, you need to calculate your equivalent yield of the T-bill because the T-bill rate given by the Treasury is APR that doesn't not include state income tax. To do the calculation, you need to covert APR to APY first then get the yield corresponding to your state income tax rate. Given the current rate of T-bills, I am afraid it won't make too much sense to invest in T-bills. Locking in a higher rate CD before the rate falls again may be a better option. Steve: To consider whether investing in T-bills still makes sense to you, you need to calculate your equivalent yield of the T-bill because the T-bill rate given by the Treasury is APR that doesn’t not include state income tax. To do the calculation, you need to covert APR to APY first then get the yield corresponding to your state income tax rate. Given the current rate of T-bills, I am afraid it won’t make too much sense to invest in T-bills. Locking in a higher rate CD before the rate falls again may be a better option.

]]> By: Stevehttp://www.thesunsfinancialdiary.com/investing/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-34722 Steve Mon, 14 Jan 2008 21:38:40 +0000 http://www.thesunsfinancialdiary.com/2006/11/06/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-34722 I have a traditional CD which yields 5.1% APR - I think. It is locked for 9 months - lets just say I have 10,000 to invest. Would it make more since to invest in t - bills or just keep it in the traditional CDthanks I have a traditional CD which yields 5.1% APR – I think. It is locked for 9 months – lets just say I have 10,000 to invest. Would it make more since to invest in t – bills or just keep it in the traditional CD

thanks

]]> By: alanhttp://www.thesunsfinancialdiary.com/investing/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-34389 alan Sun, 13 Jan 2008 04:57:32 +0000 http://www.thesunsfinancialdiary.com/2006/11/06/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-34389 am i crazy for looking for a 7-8% return, is there such a thing, that is safe? there is a bank, mlnbank.com, millenium bank i think that is offering 8% long term cds. For real, or pipe dream? am i crazy for looking for a 7-8% return, is there such a thing, that is safe? there is a bank, mlnbank.com, millenium bank i think that is offering 8% long term cds. For real, or pipe dream?

]]> By: Sunhttp://www.thesunsfinancialdiary.com/investing/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-14321 Sun Thu, 19 Jul 2007 01:51:33 +0000 http://www.thesunsfinancialdiary.com/2006/11/06/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-14321 Paul & Sean: It doesn't matter which investment/saving vehicle you are using, the ultimate goal is to make the most of your money. For savings accounts, my money always go to the one that pays the highest rate. This is also true for T-bills. If the T-bill rate (the effective yield after you factor in your state income tax rate) is identical to that the rate of an online savings account, there's no reason to favor T-bill over a savings account. I have stopped buying T-bills for more than a month and I have no plan to jump back in if the rate stays at current level.If I have $10K, I will definitely invest it. Then where to invest the money depends on when you will need the money. If you will use it in, say, 2 to 3 years, buy a long term CD may be the best choice. If the money is for your retirement or that you won't touch in 10 or 20 years, then investing it in an index fund or ETF in lump sum makes more sense. Paul & Sean: It doesn’t matter which investment/saving vehicle you are using, the ultimate goal is to make the most of your money. For savings accounts, my money always go to the one that pays the highest rate. This is also true for T-bills. If the T-bill rate (the effective yield after you factor in your state income tax rate) is identical to that the rate of an online savings account, there’s no reason to favor T-bill over a savings account. I have stopped buying T-bills for more than a month and I have no plan to jump back in if the rate stays at current level.

If I have $10K, I will definitely invest it. Then where to invest the money depends on when you will need the money. If you will use it in, say, 2 to 3 years, buy a long term CD may be the best choice. If the money is for your retirement or that you won’t touch in 10 or 20 years, then investing it in an index fund or ETF in lump sum makes more sense.

]]> By: Seanhttp://www.thesunsfinancialdiary.com/investing/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-14263 Sean Wed, 18 Jul 2007 04:55:06 +0000 http://www.thesunsfinancialdiary.com/2006/11/06/t-bill-investment-rate-is-it-apr-or-apy-and-what-is-your-taxable-equivalent-yield/#comment-14263 Paul raised a very good question. Would like to hear some feedback on his question.Sun, Thank you for keeping such an informative blog. I've spent hours on your site learning as much as I can.Appreciatively, Sean Paul raised a very good question. Would like to hear some feedback on his question.

Sun,
Thank you for keeping such an informative blog. I’ve spent hours on your site learning as much as I can.

Appreciatively,
Sean

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