Gyroscopic Investing

I need to put more into cash, making it easily available during an emergency,  and I also want to avoid counterparty risk.

TD seems convenient for this, but I am unclear on one point. If I buy treasury bills or notes through TD, do I have to wait until each bill and note matures to cash them in, or will TD liquidate them early and send me the proceeds upon request?

goodasgold wrote: I need to put more into cash, making it easily available during an emergency,  and I also want to avoid counterparty risk.

TD seems convenient for this, but I am unclear on one point. If I buy treasury bills or notes through TD, do I have to wait until each bill and note matures to cash them in, or will TD liquidate them early and send me the proceeds upon request?

To sell a bill, note, or bond purchased through TD before it matures, you have to transfer it from TD to a brokerage (I'm not sure how long this takes, perhaps a day or two).  If you buy through a brokerage in the first place (rather than buy through TD), you don't have to go through this "extra" step to sell early.  The difference in risk between buying and holding in a TD account vs. buying and holding in a brokerage account is extremely small as long as you aren't holding the bill/note/bond in a margin account (my understanding is anything you hold in a margin account can be lent out by the brokerage to facilitate other customers' short sales, but that this is not allowed for regular, non-margin, accounts).  If the brokerage goes bankrupt, your assets with the brokerage might be tied up for a while - with TD you're not tied to any specific brokerage so an event even as bad as a major brokerage going under would not really affect you.

rickb wrote: To sell a bill, note, or bond purchased through TD before it matures, you have to transfer it from TD to a brokerage (I'm not sure how long this takes, perhaps a day or two). ...  If the brokerage goes bankrupt, your assets with the brokerage might be tied up for a while - with TD you're not tied to any specific brokerage so an event even as bad as a major brokerage going under would not really affect you.

TD used to be so much easier...  (you could sell anything with longer than 6mo maturity).

Another idea that should work for most situations, instead of planning to tie up all the money in TD and then being forced to sell early, how about a ladder?  (short of TEOTWAWKI, for which you want to keep your assets in hand rather than deposited anywhere)

Keep enough cash available that is readily accessible (e.g. CD's with low/no penalty) to get thru a few weeks.  Then structure TBills/Bonds so that one is maturing every few weeks.  Then in an emergency, start with 1) the cash, then 2) a series of maturing bills.  At the very least the initial cash should give time to do the transfer and sale if a bigger lump is needed than the next maturing bill will provide.

AgAuMoney wrote: Keep enough cash available that is readily accessible (e.g. CD's with low/no penalty) to get thru a few weeks.  Then structure TBills/Bonds so that one is maturing every few weeks.  Then in an emergency, start with 1) the cash, then 2) a series of maturing bills.  At the very least the initial cash should give time to do the transfer and sale if a bigger lump is needed than the next maturing bill will provide.

Good advice.  I buy an I-Bond every week and will for the rest of my life.  It may be an accounting nightmare for everyone involved, but too friggin' bad.