I accidentally loaned all my money to the US government • Hacker News Board

Re: I accidentally loaned all my money to the US government

#321

Post by mindslight » Sun, May 01, 2022, 5:33 PM UTC

FireBeyond wrote: post #314

coffeeblack wrote: post #260

Earlier quoted context omitted.

This wasn’t the authors fault at all. It’s 2022, not 1998. I would expect a banking/payment UI to be very clear and foolproof.

I am not sure how much clearer "Your deposit exceeded the limit. The excess funds will be returned" could be.

You have not quoted the email correctly. The email says "excess purchase".

As someone who has experience with savings bonds and Treasury Direct, I still have no clue how to interpret that phrase. Savings bonds are discrete things with discrete values, even though TD has worked to smooth over that quality with arbitrary purchase amounts and partial redemptions. "Excess purchase" may very well mean a refund of the entire singular $9,975 bond that was purchased.

The way to find out is to call TD or search around web forums, but it's understandable that OP reacted to one possible implication of the message rather than taking a few hours to find out what it means.

Re: I accidentally loaned all my money to the US government

#322

Post by OJFord » Sun, May 01, 2022, 5:34 PM UTC

OJFord wrote: post #27

eterm wrote: post #21

Earlier quoted context omitted.

That's an odd interpretation of the refund. The email clearly states, > "A refund of the excess purchase..." So they'd be refunded the excess, i.e. $25. Putting another $9,975 through just feels like being "too smart".

I found that ambiguous, could either read it as the excess amount or the entirety of the purchase that resulted in excess balance. But anyway it just shows more UX issues - if it's the former then why didn't the balance update to show $10k; in either case why does it accept the payment before checking? It should just say no you've hit your limit this year, or you've already subscribed $25 this year you're limit is $9…

Missed the edit window, but I can't leave that - I meant 'your limit', of course. I blame Android keyboard.

Re: I accidentally loaned all my money to the US government

#323

Post by midjji » Sun, May 01, 2022, 5:37 PM UTC

I always find it fascinating that one of the few things so badly designed that they just have to be a scam, is actually real .gov stuff.

Re: I accidentally loaned all my money to the US government

#324

Post by ellisv » Sun, May 01, 2022, 5:38 PM UTC

sangnoir wrote: post #315

0daystock wrote: post #311

> it dawned on me that not only did I just loan $19,975 to the government for 2 months with zero interest, but I’d locked myself out of the golden window for buying I-bonds. This guy has less than 20 grand to his name and he's investing in I-Bonds? That's the real tragedy.

Ok, I'll bite - what should they be investing in if their investment horizon is 12 months? The stock market is in the middle of a correction, and there's no telling when that will end.

> This guy has less than 20 grand to his name and he's investing in I-Bonds? That's the real tragedy.

That was the shocking bit for me too, although I suspect (hope?) the author has more money outside that bank account.

I wouldn't recommend anyone with only $20k invest it or at least not entirely. Sure they have (probably) the best risk-adjusted return right now but Savings I Bonds aren't a great emergency fund because of 12 month lockup and 3 month interest penalty for liquidation in the first 5 years.

Re: I accidentally loaned all my money to the US government

#325

Post by adrianmonk » Sun, May 01, 2022, 5:41 PM UTC

todd8 wrote: post #279

Roughly the same thing happened to me on a much much bigger scale. I was making an estimated income tax prepayment (as required by law) on the ridiculous IRS direct pay site. There was no way to undo my error that I could find on the IRS websites. I foolishly thought that when the IRS web page said something like “system problem try again later” meant that I should try again later. I feel like the agencies should jus…

In the early days of the web, I did this with college textbooks. It was the very first semester that textbook web sites were open for business. IIRC, they advertised heavily. A zillion college students got on the site all at once to save money and try out this new e-commerce concept, and the site collapsed under the load.

I went through the process 3 times and got an error each time. Eventually I gave up and decided I'd have to buy books in person the old-fashioned way. I'm pretty sure I got at least 2 sets of books delivered to me.

I had to arrange for a return, and customer service wasn't happy about it. These days, it's pretty obvious that an error on a web page doesn't conclusively mean a purchase didn't go through, but back then I don't think either they or I clearly understood that.

Re: I accidentally loaned all my money to the US government

#326

Post by mise_en_place » Sun, May 01, 2022, 5:41 PM UTC

hedora wrote: post #192

otherme123 wrote: post #54

Earlier quoted context omitted.

So if someone makes an honest mistake and types and extra number, it's OK to both 1) don't process any amount and 2) hold the money for two months. That doesn't feel right to me. E.g. I buy shares and mistype the ticker or buy extra. It processes but then I notice my mistake and I can either fix it by selling, or decide ir doesn't matter and keep the shares. What doesn't make any sense is the broker keeping the money…

Have you ever paid taxes in the US? The IRS loves creating scenarios that lead to them incorrectly holding big wads of your cash.

One of my coworkers told me a long time ago, it's better to increase your withholding allowances. That way the government is giving you an interest free loan.

Re: I accidentally loaned all my money to the US government

#327

Post by nullc » Sun, May 01, 2022, 5:46 PM UTC

The obsession with the high variable rate on ibonds right now strikes me as weird.

With a fixed rate of 0% at the moment, the ibond is an "investment" which is guaranteed to lose real value because the 'gains' from the ibond are taxed so if the fixed rate is zero it will lose real value. It will also lose value due to systematic understatement of inflation e.g. due to the substitution correction-- but even if you believe that its inflation metric is fair the taxation makes it lose value.

Now-- if your investment plans direct you to hold something cash-like which ibonds withdraw delays are still good enough to satisfy, then okay sure, it does pay more than cash. But that's the right comparison. Ibonds are not, for example, a good alternative to buying a market index with a historical return of 10% after inflation.

Re: I accidentally loaned all my money to the US government

#328

Post by redisman » Sun, May 01, 2022, 5:46 PM UTC

bombcar wrote: post #35

vasco wrote: post #32

The venn diagram of internet users that read about super specific financial products, decide to buy them, while not even understanding the need to keep an emergency fund such that a move like this leaves them with under $200 in their account seems to be growing. It seems to be a weird mix of wall street cosplay and financial ineptitude.

To be fair this mystical 8.4% has been plastered everywhere as a “buy now” which is causing serious fomo. Also the blog clearly indicates they were going to poke the fate bear, poked said bear, and then went surprised pikachu.

The investment is good and safe. I also bought I bonds and will buy more as I accrue cash. It’s not even really an investment as technically you make $0 in purchasing power. This is more of a UX and lack of emergency fund fail.

Re: I accidentally loaned all my money to the US government

#329

Post by redisman » Sun, May 01, 2022, 5:48 PM UTC

mynameishere wrote: post #241

fortran77 wrote: post #185

Earlier quoted context omitted.

You can take the money out of an ibond with a small penalty after a relatively short time. So it's not a huge risk if you have enough short-term credit, etc, for an emergency before the time comes when you can cash the iBond.

Seriously, what the hell. Acting like this guy is blowing his future on a roulette wheel by getting some savings bonds. Is anybody else just sick to death of the term "emergency fund"? If you go to /r/personalfinance, every other comment is reminding people to stock up their emergency fund. Towelie says, "Don't forget to bring a towel!" I'll tell you about my real "emergency fund": In an actual, living emergency, eve…

Only $200 in your checking account is just logistically a nightmare. If OP has any autopay set up they’re very likely to overdraw

Re: I accidentally loaned all my money to the US government

#330

Post by redisman » Sun, May 01, 2022, 5:51 PM UTC

nullc wrote: post #327

The obsession with the high variable rate on ibonds right now strikes me as weird. With a fixed rate of 0% at the moment, the ibond is an "investment" which is guaranteed to lose real value because the 'gains' from the ibond are taxed so if the fixed rate is zero it will lose real value. It will also lose value due to systematic understatement of inflation e.g. due to the substitution correction-- but even if you bel…

What are the options? Get -8% on your checking or savings or a very volatile stock market return? It’s perfect for saving for a down payment. I’d still of course max out 401ks and such in addition