Re:Fidelity Introduces Zero Expense Ratio Index Funds
by anarazel on Sunday August 05, 2018 @04:51AM
(#17690401)
Because "emergency fund" and "illiquid for six months" aren't a great combination?
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Re:Fidelity Introduces Zero Expense Ratio Index Funds
by halbritt on Monday August 06, 2018 @12:54AM
(#17695165)
Illiquid in the sense that it takes a few days to liquidate. One can always get back their original investment with no penalties.
Re:Fidelity Introduces Zero Expense Ratio Index Funds
by oplav on Monday August 06, 2018 @09:04AM
(#17697178)
Is that correct? According to the TreasuryDirect website, you can't redeem a bond within the first year. If a bond is less than 5 years old, you pay a 3 month interest penalty.
https://www.treasurydirect.gov/indiv/research/indepth/ibonds...
Re:Fidelity Introduces Zero Expense Ratio Index Funds
by halbritt on Monday August 06, 2018 @09:48AM
(#17697468)
That is correct. It's twelve months instead of six. I was mistaken. Generally speaking an emergency fund should be 3-6 months of income. I justified the illiquid period by moving a third of my fund into it at a time.
The interest "penalty" is simply not getting back the interest accrued in the prior three months.