Tbills for small amount of cash
Hi Terry my question is regarding purchasing tbills. I have $600 sitting in a e*trade account and would like to know when opening the account with the treasury direct if I could use that account # or do I have to transfer the money to my savings account . And should I buy 1-$100 for 6 month tbill or 6-$100 ?
Terry Says
First, ask what kind of interest eTrade is paying on your cash in your account. Second, ask yourself how soon the money will be needed. If it’s less than a year or two, you might as well leave it at eTrade, even if it is earning very little. TreasuryDirect accounts should be used for money that you want to set “out of reach” of the temptation to spend. The accounts are not “liquid” until the Treasury bill you purchase matures. And then it has to be wired back to your bank account. I’m pretty sure that the money can only be wired to/from an FDIC-insured institution — and it would be quite a hassle to do this for just a small amount of money.
