How many of you got the card just to have a titanium Apple card, and never used it, or was that just me?
The 2% back on all touchless/apply pay integrations is what sold it for me.
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Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
221–230 of 306 posts
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#222Earlier quoted context omitted.
You probably want a credit rating for financial products, and that’s independent to a specific country. They could expand to Europe and Canada without too much effort, but I’m not surprised to see them start with the US.
Starting with the US makes sense, but 2 years later not having launched elsewhere and launching a new US-only product, that feels like longer than I expected.
You’d probably need different banking partners in each region, so it’s like a whole new product.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#223It's interesting that they will not accept any transfer-in, even reject a transfer, if the balance exceeds $250,000. This must be because of the FDIC insurance limit, and hence protects the consumer's savings. Quite the opposite of what some banks are trying to do: offer accounts that try to provide FDIC insurance over 250k by spreading your money among other banks. From the footnote 1: https://www.goldmansachs.com/t…
At what point does an investment with Apple actually become just as safe if not safer than the FDIC? Neither is realistically going to fail, but with the debt ceiling once again rearing it’s head, I have more trust in the leadership of Apple not doing something stupid than I do in the US government not doing something stupid. Governmental incompetency and dysfunction seems like a bigger risk than insolvency of Apple.
Apple has approximately $50B in cash on hand. The US government can print a trillion+ on a whim. So if there's a banking crisis I'm going to trust the FDIC to bail me out over Tim Cook (and there's a pretty strong recent precedent of exactly that).
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#224Earlier quoted context omitted.
I could be wrong, but I thought you could sell T-Bills fairly easily on the secondary market. You might take a bit of a haircut, so it's obviously better to hold onto until maturity, but I think in a pinch you can get most of the money back.
Short term rates are still rising, and you will lose money if you sell early. There is risk. There is no risk in a US savings account under $250k
Oh, no argument there; it's about risk management in my mind. How often do financial emergencies happen? How often do I need to dip into long term savings? If I do have to dip into long term savings, how much of a haircut am I willing to take?
The answer to these questions are going to be different for each person and I obviously cannot answer them. What I'm trying to say is the money isn't wholly illiquid.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#225Earlier quoted context omitted.
I could be wrong, but I thought you could sell T-Bills fairly easily on the secondary market. You might take a bit of a haircut, so it's obviously better to hold onto until maturity, but I think in a pinch you can get most of the money back.
Short term rates are still rising, and you will lose money if you sell early. There is risk. There is no risk in a US savings account under $250k
Sure there's some interest rate risk to short term treasuries but the real world risk rounds pretty close to zero. Plus it lessens as it matures.
In the current situation with the 3m at 5.125%, if you were the most unlucky investor in the world and bought it today, and the Fed immediately announced they're raising target rates by %1, and the market actually immediately responded with a commensurate %1 increase in the market rate, and you had to liquidate your position immediately for cash, you'd be down about 0.2375%.
A more realistic 25bps (i.e. .25%) rate hike would be .0605%. And again that's if it happens at exactly the moment after you've acquired the treasury. For every day that passes, the time to maturity shortens even further, so the current price impact to any interest rate change would lessen as well.
If you know you need the cash then yes keep it in a savings account. But if you're unsure, you could a lot worse than buying 3-month T-bills.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#226I feel somewhat confused; my current Wells Fargo saving account APY is 0.01% where did I go wrong? Seems like I might be shifting my money to a new home. Edit: In the very least it will educate many uninformed folks like myself they are getting shafted at their current banks. Double edit: Thank you for all the helpful links and information!
> where did I go wrong Credit unions are typically more competitive than big banks in general. If you truly want to make the most out of every penny then you should be unbundling your bank services (checking at CU A, savings at CU B, credit at X, etc.). This is especially easy with credit unions because they are typically part of a cooperative that streamlines inter-bank transfers (it usually takes There can be highe…
I definitely agree with un-bundling for the best services over all. The problem with credit unions are most are regional (though some are not). I have the best CU in my area which is fine, but it doesn't have a competitive credit card offering or savings rate. It does have good service and some good other benefits and I use it for my main checking account.
I don't agree CUs are more competitive always than big banks. I think for the most part big banks have better credit card offerings for example. There are lots of reasons someone would go for a big bank like Chase for credit cards.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#227Earlier quoted context omitted.
Health insurance feels like a sort of "gross" industry that I don't imagine Apple would want to be associated with. Could be wrong though.
Neither did online advertising. Apple today is mostly about leveraging the iOS moat to sell services, the bulk of which will be gross.
Mobile developers needs advertising because, as awful as it is, it's an important business model. It's an important complement to Apple's business model, even if I think they should have stayed out and just used policy/technical means to ensure other companies aren't too sleazy.
I don't see any similar need to get into health insurance though.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#228Earlier quoted context omitted.
> is there any reason not to just move over completely? Technically Betterment is not a bank, but it sounds like these cash accounts are backed by accounts at banks There is some small risk that if betterment folds, those funds aren’t protected. It’s afaik never been really tested in court. FDIC would protect only the underlying bank - not betterment. It’s a very small risk though. But a real bank doesn’t have that r…
In their terms it sounded like if they close your account for whatever reason, you can still go directly to the banks and recover your funds. They did say the funds would be temporarily uninsured at certain points while in transit (deposit/withdrawal, redistribution, etc) but that seems like a relatively small risk Is it possible they'd try to claim first-dibs on your funds that are living in other banks if they went…
Basically yes.
Typically when companies/banks do this sort of pass through banking, the money isn’t actually held in a personal account at the host bank. It’s usually held in one giant account that had a “managed on behalf of many” type structure. This is legal from an FDIC perspective, but it’s held in the not-banks name (aka betterment). So if betterment goes into debt, it’s a grey area if they could use that money.
They could also mismanage money during that “temp uninsured” period. Again, they’re not a bank so they don’t necessarily comply with banking regulations so you don’t know how long that period is or what’s happening.
There are real regulated entities (banks brokers credit unions etc) that offer good rates and less risk. I don’t know why you’d expose yourself to any risk for 0.x% APR. Even Goldman Sachs (the underlying bank of apple) lets you get a good interest rate on savings directly.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#229How many of you got the card just to have a titanium Apple card, and never used it, or was that just me?
Yeah, same. And now I don't even know where the physical card is.
Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p
#230Earlier quoted context omitted.
Your two statements don't match up. Sounds like they can offer at least 3% more, no?
Yes they do. Do you think a company is going to set themselves for a best case scenario of breaking even? Or just take a 25% hit to profit unless they absolutely need to? I just look at Wells Faro, and they have $900 billion in interest bearing deposits. With NI of $16 billion, just going up to 1% will wipe out 55% of profit.
I don't think I articulated myself well, I wasn't taking a judgement. There is no logical inference that a company needs (or deserves) the profit margin it had last year, for example, that's just a fact of business.
My point was essentially to stay viable, the bank needs to have some profit margin. Here is a classic business choice between maintaining or improving profit margin, and maintaining or improving services.
So my point was they could obviously remaining viable while offering higher rates, they choose not to because it increases short term profit - if they think they are losing enough business to other banks with better rates, presumably they will start raising them to compete.
The fact that they can't really meet current federal rates and stay profitable is interesting, it suggests they have some pretty heavy cost centers to carry.