What are pros and cons of buying CDs with brokerage companies like Fidelity/Vanguard/E-Trade/Robinhood etc…
Just buy t-bills instead. No state tax, no lockup
No state tax in WA
I have CDs in my Fidelity 401k if that’s what you’re asking. I work with a Fidelity advisor and asked him to put together a 5 year CD ladder for me. Pros are that they do the shopping around instead of me. They also have access to way more financial institutions that offer them than you or I would. I also have a 5 year CD ladder that I did myself with various banks. Both are easy to do.
What is the interest rate that you will get?
CD rates are based on the Fed rate and vary depending on where you are getting your CDs. I have mine at various banks and the ones through fidelity are banks and other institutions. Fidelity’s rates are a bit higher which makes sense.
I only tried it with Fidelity a couple of times and there were no Cons. If you get municipal bonds then you may have no Federal tax but you need to be in the high tax bracket to really take advantage of this.
I don't see any cons with Fidelity. Some banks will require you to come over to their office to sign paperwork for booking and withdrawal on maturity, which is silly