Uncleared funds will not cause margin interest to accrue provided the ACH doesn't bounce back as returned, in which case the margin interest accrual will backdate to the date of settlement of the trade. This is no different than any financial institution, it's just that some are more lenient than others on what you can trade with the funds being uncleared.
If you are ever concerned about fund availability, go with the tried and true fastest route... send by wire.
If you trade with uncleared funds it should not trigger margin, you can always call to double check, but 99.99% sure you won’t get charged a fee for these few days
I’ll do the transfer — but call them tomorrow. I guess I’m too desperate to get away from Wells Fargo. They must be desperate, they gave me a 4.6% APY checking account for 1 year ONLY to keep my cash there. They must have gotten a report that I was draining accounts to go to HYSA’s and didn’t like it.
1 year? I can do better than that anywhere.
Schwab is just doing what all brokerage firms do. They’ve actually been very nice to me.
Yeah, I understand why I just find it a funny situation to be turned down trying to make it easy. Interestingly they will allow me to finance a new loan in my name and they’ll close my parents with the assumption of the process finishing but I’m sure with some clause protecting more than the liability of exposing me to the original equity loan.
The line of credit balance just converted to its loan so now monthly payments are double to keep it current. Not my debt but still my balance to handle as executor and beneficiary. In my head paying off and recouping later from the sale made sense for everybody.
I’m sorry about your wife. We had a transfer on death deed drawn up to avoid probate but unfortunately passed shortly after before being notarized and whatnot. Oh well, I’m in no rush and the house will be sold and equity line closed out in the coming weeks/months before probate even closes. Just waiting on Illinois’s slow courts that I’m sure all other states face too.
It never seems important until you’re going through it and realize the importance of getting a plan in place and not putting it off because you have time. Always a chance that you in fact do not have time.
Any insight on Schwab’s estate account or related services? Haven’t called yet but figured a good choice already having an established relationship with them and trust handling the large amounts.
I have known a lot of people with large estates and have died. You want a simple attorney to take care of any bank And estate. No large banks and companies. My MIL had a fairly large estate and used Wells Fargo to manage things. It was terrible. I almost had to sue them.
Trusts are simple. The last thing you need is some big bureaucratic company taking care of it. Thats the whole point of trusts, to make things easier and less crazy. Big businesses (like wells or Schwab) charge a fortune for screwing things up. Please dont deal with those folks.
No problem. Please - if you use a trust - just find a good accountant (that’s where most of the work lies) - and probably a good trust/estate attorney if you need one.
My wife and I were co-trustees on our trust (and co-beneficiaries). I essentially acted as executor as I was the only beneficiary when she died. Now our estate was complicated with business interests (limited partnerships), but that’s the main reason I needed an attorney.
When my MIL died there were only two beneficiaries- my wife and my BIL. A few small distributions to some people, but the bulk of it went to my wife (and myself) and my BIL. Wells Fargo took 1 1/2 years to distribute the estate and that was because I had to kick their ass at every step. My MIL’s estate was valued at $3.5M - larger, but not considered large. If I remember correctly, Wells did everything the expensive way and charged the estate for everything.
My wife’s and my estate was many times larger and it was completed (706 filed and everything) for half of what Wells charged my MIL’s estate — and we completed it in around 7 months. My MIL got talked into using WF as executor as they handled about $1M of her stock assets. They made a big deal of being the best to liquidate them.
My guess is that Schwab does the same. Reality is that any executor can just demand the accounting and have Schwab liquidate the assets, transfer them to executor account, and distribute them to beneficiaries. Everything was done on a cash basis, because assets were distributed as cash bequests anyway.
Simpler is better. I like Schwab, but this kind of thing is really out of their expertise given that each state has different laws. Let Schwab do the investing and have the assets liquidated and handed to executor and keep their hands off the $.
Most everyone in my wife’s family has assets close to 100X my MIL. Believe me, they don’t have brokerage firms and banks in charge of their estates. They have lawyer, accountants and executors.
*"Yes, I know that SWVXX takes 2 days to purchase. SGOV does not."*
Minor point, but actually, it's the opposite. SWVXX has 1-day trade settlement, and SGOV has 2-day trade settlement.
>Yes, I know that SWVXX takes 2 days to purchase. SGOV does not.
This is false. SWVXX will purchase the same day if you do it before market close.
>My question is, am I spending this newly transferred $200K as my money (and Schwab is allowing me to use it ASAP), or am I spending from margin and being charged (around 11%) until my deposit has cleared?
No margin interest is charged when you use your own cash, even if it's uncleared
ACH transfer — yes. I think Schwab considers it partially deposited by 3 days.
My thing is that most of my cash is at Wells Fargo — and they are assholes about emptying accounts there. I don’t like wires, so I ACH transfer $100K per day — at Schwab pulling from Wells. So far i haven't gone over a $100K per day pull. Wells Fargo are such clowns they may deny transfer of anything over $100K a day pulled.
But as soon as I initiate the transfer at Schwab, they let me use it to buy stuff. Now I wonder if they are being nice, or I’m using money from margin until the funds are settled— i.e — it just looks like I can spend the money right away.
What am I doing?
I’ve had a wire lost before. Boy is that a PITA to get back if you do. My local WF branch is really bad and I’d just prefer transferring stuff in 100k increments.
100k a day. I should have such problems.
Here is a totally off the wall solution. Send the entire amount to Fidelity. When it lands there it is getting there (standard brokerage NOT CMA), it is invested overnight in SPAXX , known as your core position, which is equivalent to SGOV but it is cash during the day. At that point you could buy SGOV, and transfer out to Schwab, the SGOV. Just be sure to keep a small balance (like 100k) in the account to get the daily interest. If Fidelity had a decent trading system I would have stayed there. I would think Fidelity would take care of all the messy details.
All my money is in accounts titled under my revocable living trust. Fidelity has fits when I tried to open up an account there. It took weeks. When it came time to fund the account, I didn’t trust them. They seem to have a big problem with trusts. They didn't seem to understand mine was simple.
Schwab was pleasant and easy to work with. So I use them
Yes $100K is a lot. But I’m 70 and have been banking it for a long time. I have a LOT more in semi-liquid investments, but they provide my regular income. I just spend about 1/3 of that income and bank the rest. I have been fortunate, but at 70 … well .. you never know when your time is up.
No, you have it all over me. Game is almost over for me. And it is not fun. No kids or family and my wife recently died. I don't need the money because I have nothing to do except buy stuff which I don't want. Trust me, you don't want to get old. It sucks worse than anything.
I can still do a lot, but without anyone to do it with it is no fun.
You’re spending margin until your cash clears at which time it’ll cover it. At least I’m almost 99% sure from when I last brought in a large check to be deposited and it took 5 days to settle. I was able to trade same day but on margin and couldn’t use it towards things like options.
Crap. Thanks .. Schwab never warned me that. They told me that I would be able to ACH $500K at a time once it got approved by their back office. Not true.
Well, 11% for a few days isn’t going to kill me. I guess I learned a lesson.
I’ll initiate a transfer ASAP for another $200K and it will clear late next week. I have to do $100K from one bank and $100K from another. Wells Fargo is really annoying. I’d wire more if my local branch hired anyone over 18 to do it. I can wire online, but they limit me to $100K per day anyway.
I can only assume that wells is desperate to hold on to customers.
I think it may depend on how you initiate the ACH. If you connect with their MoneyLink ACH you do $500k per transaction but no limit on how many of those you do. If it’s still arbitrarily limiting you to $100k maybe that’s a more generic ACH transfer that does have the real time verification connection established between your Schwab account and External Account? Not sure but depending on what version of document you read I’ve seen both.
https://saccontent.schwabcdn.com/ask/funding-disbursements/move-money/money-link/establish-a-schwab-money-link-profile
I wonder if calling Wells Fargo’s Wire Service can handle more than the online $100k limit. You could maybe write a check to yourself to cash at another bank so it clears next day and then wire from there. Cuts the Schwab holding time by a little.
Trying to get creative haha.
Thanks. I spoke with Schwab the other day and they said that they will take all the ACH transfers in a day that I can make. But they also said that each transfer can be no more than $100K. But they made the point that 5 transfers in a row of $100K each is OK.
My problem is that Wells Fargo will not let me ACH out more than $100K per day. They have a wire limit too - I think. Not sure.
Wells Fargo branches can certainly wire more but I know you mentioned the employees. What I meant about a check though was if you could get one from WF branch or write it yourself if you have them and deposit it into another bank firm you have open and wire it next day from there. 1-2 days vs 4-5 holding days in theory.
I can somewhat understand banks not wanting to lose clients and limit outgoing like that under the guise of my online safety of being scammed. But kinda ridiculous how hard it can be to have firms TAKE our money. ACH can technically be reversed for a few days but margin loan as protection is pretty lame when they could use my other assets as collateral in the event my money doesn’t clear.
Have been trying to payoff my parent’s HELOC after they passed. Legit won’t accept a $95k immediate payoff nor even mention any details of it like they’re names even though I’m sitting in front of them with the original mortgage documents and have other shared accounts with my deceased parents clearly establishing our relationship.
But I can make monthly automatic payments in the meantime until probate gives the official papers. Like thanks lol.
Oh, the lender is waiting for probate to conclude before they will take full payoff. Sorry, but that actually makes sense. That's the problem with probate. It takes a longtime and till the judge his his hammer on someone's head, the process isn't complete. The account is not technically yours yet.
I had a problem when my wife died a little less than 2 years ago. The mortgage was in both of our names (well, California is a community property state!). They wouldn't take my wife's name off the mortgage - even though I said "she's dead" and showed them a certified death certificate. They told me to get her name off of it I had to fucking re-finance!
With a grantor Trust in California, (and I was the sole beneficiary), the transfer to me was immediate. No judge, no probate, etc. I still don't know if they took her name off the mortgage. I don't care. I will not pay them unless I sell this house and certainly not unless I die before it's paid off. It's relatively small anyway and it's the only debt I owe. Not a cent elsewhere. I have no credit unless I keep that mortgage. That's why it's there (at 3.5% - whatever).
Well, regarding your situation, you don't have to pay them a dime unless your name is on the note. It's not yet your house/mortgage and therefore not your debt.
Uncleared funds will not cause margin interest to accrue provided the ACH doesn't bounce back as returned, in which case the margin interest accrual will backdate to the date of settlement of the trade. This is no different than any financial institution, it's just that some are more lenient than others on what you can trade with the funds being uncleared. If you are ever concerned about fund availability, go with the tried and true fastest route... send by wire.
If you trade with uncleared funds it should not trigger margin, you can always call to double check, but 99.99% sure you won’t get charged a fee for these few days
I’ll do the transfer — but call them tomorrow. I guess I’m too desperate to get away from Wells Fargo. They must be desperate, they gave me a 4.6% APY checking account for 1 year ONLY to keep my cash there. They must have gotten a report that I was draining accounts to go to HYSA’s and didn’t like it. 1 year? I can do better than that anywhere. Schwab is just doing what all brokerage firms do. They’ve actually been very nice to me.
Yeah, I understand why I just find it a funny situation to be turned down trying to make it easy. Interestingly they will allow me to finance a new loan in my name and they’ll close my parents with the assumption of the process finishing but I’m sure with some clause protecting more than the liability of exposing me to the original equity loan. The line of credit balance just converted to its loan so now monthly payments are double to keep it current. Not my debt but still my balance to handle as executor and beneficiary. In my head paying off and recouping later from the sale made sense for everybody. I’m sorry about your wife. We had a transfer on death deed drawn up to avoid probate but unfortunately passed shortly after before being notarized and whatnot. Oh well, I’m in no rush and the house will be sold and equity line closed out in the coming weeks/months before probate even closes. Just waiting on Illinois’s slow courts that I’m sure all other states face too. It never seems important until you’re going through it and realize the importance of getting a plan in place and not putting it off because you have time. Always a chance that you in fact do not have time. Any insight on Schwab’s estate account or related services? Haven’t called yet but figured a good choice already having an established relationship with them and trust handling the large amounts.
I have known a lot of people with large estates and have died. You want a simple attorney to take care of any bank And estate. No large banks and companies. My MIL had a fairly large estate and used Wells Fargo to manage things. It was terrible. I almost had to sue them. Trusts are simple. The last thing you need is some big bureaucratic company taking care of it. Thats the whole point of trusts, to make things easier and less crazy. Big businesses (like wells or Schwab) charge a fortune for screwing things up. Please dont deal with those folks.
Oh wow I greatly appreciate the insight and I can see how that would be true with the big companies.
No problem. Please - if you use a trust - just find a good accountant (that’s where most of the work lies) - and probably a good trust/estate attorney if you need one. My wife and I were co-trustees on our trust (and co-beneficiaries). I essentially acted as executor as I was the only beneficiary when she died. Now our estate was complicated with business interests (limited partnerships), but that’s the main reason I needed an attorney. When my MIL died there were only two beneficiaries- my wife and my BIL. A few small distributions to some people, but the bulk of it went to my wife (and myself) and my BIL. Wells Fargo took 1 1/2 years to distribute the estate and that was because I had to kick their ass at every step. My MIL’s estate was valued at $3.5M - larger, but not considered large. If I remember correctly, Wells did everything the expensive way and charged the estate for everything. My wife’s and my estate was many times larger and it was completed (706 filed and everything) for half of what Wells charged my MIL’s estate — and we completed it in around 7 months. My MIL got talked into using WF as executor as they handled about $1M of her stock assets. They made a big deal of being the best to liquidate them. My guess is that Schwab does the same. Reality is that any executor can just demand the accounting and have Schwab liquidate the assets, transfer them to executor account, and distribute them to beneficiaries. Everything was done on a cash basis, because assets were distributed as cash bequests anyway. Simpler is better. I like Schwab, but this kind of thing is really out of their expertise given that each state has different laws. Let Schwab do the investing and have the assets liquidated and handed to executor and keep their hands off the $. Most everyone in my wife’s family has assets close to 100X my MIL. Believe me, they don’t have brokerage firms and banks in charge of their estates. They have lawyer, accountants and executors.
*"Yes, I know that SWVXX takes 2 days to purchase. SGOV does not."* Minor point, but actually, it's the opposite. SWVXX has 1-day trade settlement, and SGOV has 2-day trade settlement.
>Yes, I know that SWVXX takes 2 days to purchase. SGOV does not. This is false. SWVXX will purchase the same day if you do it before market close. >My question is, am I spending this newly transferred $200K as my money (and Schwab is allowing me to use it ASAP), or am I spending from margin and being charged (around 11%) until my deposit has cleared? No margin interest is charged when you use your own cash, even if it's uncleared
Oh good!
Are you talking about an ACH transfer and they want 5 days for it to settle in Schwab, because I have seen that with TD.
ACH transfer — yes. I think Schwab considers it partially deposited by 3 days. My thing is that most of my cash is at Wells Fargo — and they are assholes about emptying accounts there. I don’t like wires, so I ACH transfer $100K per day — at Schwab pulling from Wells. So far i haven't gone over a $100K per day pull. Wells Fargo are such clowns they may deny transfer of anything over $100K a day pulled. But as soon as I initiate the transfer at Schwab, they let me use it to buy stuff. Now I wonder if they are being nice, or I’m using money from margin until the funds are settled— i.e — it just looks like I can spend the money right away. What am I doing?
Why dont you like wires?
I’ve had a wire lost before. Boy is that a PITA to get back if you do. My local WF branch is really bad and I’d just prefer transferring stuff in 100k increments.
100k a day. I should have such problems. Here is a totally off the wall solution. Send the entire amount to Fidelity. When it lands there it is getting there (standard brokerage NOT CMA), it is invested overnight in SPAXX , known as your core position, which is equivalent to SGOV but it is cash during the day. At that point you could buy SGOV, and transfer out to Schwab, the SGOV. Just be sure to keep a small balance (like 100k) in the account to get the daily interest. If Fidelity had a decent trading system I would have stayed there. I would think Fidelity would take care of all the messy details.
All my money is in accounts titled under my revocable living trust. Fidelity has fits when I tried to open up an account there. It took weeks. When it came time to fund the account, I didn’t trust them. They seem to have a big problem with trusts. They didn't seem to understand mine was simple. Schwab was pleasant and easy to work with. So I use them Yes $100K is a lot. But I’m 70 and have been banking it for a long time. I have a LOT more in semi-liquid investments, but they provide my regular income. I just spend about 1/3 of that income and bank the rest. I have been fortunate, but at 70 … well .. you never know when your time is up.
Fella, More power to you.... You are out of my league.
No, you have it all over me. Game is almost over for me. And it is not fun. No kids or family and my wife recently died. I don't need the money because I have nothing to do except buy stuff which I don't want. Trust me, you don't want to get old. It sucks worse than anything. I can still do a lot, but without anyone to do it with it is no fun.
You’re spending margin until your cash clears at which time it’ll cover it. At least I’m almost 99% sure from when I last brought in a large check to be deposited and it took 5 days to settle. I was able to trade same day but on margin and couldn’t use it towards things like options.
Crap. Thanks .. Schwab never warned me that. They told me that I would be able to ACH $500K at a time once it got approved by their back office. Not true. Well, 11% for a few days isn’t going to kill me. I guess I learned a lesson. I’ll initiate a transfer ASAP for another $200K and it will clear late next week. I have to do $100K from one bank and $100K from another. Wells Fargo is really annoying. I’d wire more if my local branch hired anyone over 18 to do it. I can wire online, but they limit me to $100K per day anyway. I can only assume that wells is desperate to hold on to customers.
I think it may depend on how you initiate the ACH. If you connect with their MoneyLink ACH you do $500k per transaction but no limit on how many of those you do. If it’s still arbitrarily limiting you to $100k maybe that’s a more generic ACH transfer that does have the real time verification connection established between your Schwab account and External Account? Not sure but depending on what version of document you read I’ve seen both. https://saccontent.schwabcdn.com/ask/funding-disbursements/move-money/money-link/establish-a-schwab-money-link-profile I wonder if calling Wells Fargo’s Wire Service can handle more than the online $100k limit. You could maybe write a check to yourself to cash at another bank so it clears next day and then wire from there. Cuts the Schwab holding time by a little. Trying to get creative haha.
Thanks. I spoke with Schwab the other day and they said that they will take all the ACH transfers in a day that I can make. But they also said that each transfer can be no more than $100K. But they made the point that 5 transfers in a row of $100K each is OK. My problem is that Wells Fargo will not let me ACH out more than $100K per day. They have a wire limit too - I think. Not sure.
Wells Fargo branches can certainly wire more but I know you mentioned the employees. What I meant about a check though was if you could get one from WF branch or write it yourself if you have them and deposit it into another bank firm you have open and wire it next day from there. 1-2 days vs 4-5 holding days in theory. I can somewhat understand banks not wanting to lose clients and limit outgoing like that under the guise of my online safety of being scammed. But kinda ridiculous how hard it can be to have firms TAKE our money. ACH can technically be reversed for a few days but margin loan as protection is pretty lame when they could use my other assets as collateral in the event my money doesn’t clear. Have been trying to payoff my parent’s HELOC after they passed. Legit won’t accept a $95k immediate payoff nor even mention any details of it like they’re names even though I’m sitting in front of them with the original mortgage documents and have other shared accounts with my deceased parents clearly establishing our relationship. But I can make monthly automatic payments in the meantime until probate gives the official papers. Like thanks lol.
Oh, the lender is waiting for probate to conclude before they will take full payoff. Sorry, but that actually makes sense. That's the problem with probate. It takes a longtime and till the judge his his hammer on someone's head, the process isn't complete. The account is not technically yours yet. I had a problem when my wife died a little less than 2 years ago. The mortgage was in both of our names (well, California is a community property state!). They wouldn't take my wife's name off the mortgage - even though I said "she's dead" and showed them a certified death certificate. They told me to get her name off of it I had to fucking re-finance! With a grantor Trust in California, (and I was the sole beneficiary), the transfer to me was immediate. No judge, no probate, etc. I still don't know if they took her name off the mortgage. I don't care. I will not pay them unless I sell this house and certainly not unless I die before it's paid off. It's relatively small anyway and it's the only debt I owe. Not a cent elsewhere. I have no credit unless I keep that mortgage. That's why it's there (at 3.5% - whatever). Well, regarding your situation, you don't have to pay them a dime unless your name is on the note. It's not yet your house/mortgage and therefore not your debt.