cancel
Showing results for 
Search instead for 
Did you mean: 

Navy Federal Credit Union Digital Investor Service?

tag
Have1
Regular Contributor

Navy Federal Credit Union Digital Investor Service?

I have done a search on the forum and I can't seem to locate any posts about NFCUs Digital Investor service.  So I figure here is the place to ask.

 

I am looking to start investing some money in the market and, since I am a member already, the service looks to be a good fit for me.  But I haven't any experience with investing other than an old deferred compensation plan that I cashed out years ago to fund a business.  Turns out that was a poor investment, but that is a story for another time.  sigh.

 

NFCU Digital Investor has a $3.50 /month fee per account,  no minimum investment to start, ability to buy fractional shares and what appear to my inexperienced eye to be low transaction costs. 

 

My intent will be to buy and hold some index funds and maybe a few individual stocks after I get myself comfortable. 

 

I already have two pensions (one I am already receiving and the other will start paying in five years) and I hope to be able to collect my Social Security when the time comes.  I have a small 401K that I am maximizing the employer match for, as well.  I'm looking to build a savings that will return higher yields than a savings account or CD but be accessible if needed sooner than when I will eligible to start pulling from my 401k or HSA accounts without penalties.  

 

The positives that I see with Digital Investor are that the bar to entry is low, I have NFCU membership and the checking account already set up and the fees don't seem high.  I don't have the experience to identify the negatives.

 

Do those of you that have experience with investing have any thoughts, advice, cautions, etc. that you are willing to share?  I really appreciate it. 

Message 1 of 21
20 REPLIES 20
SouthJamaica
Mega Contributor

Re: Navy Federal Credit Union Digital Investor Service?


@Have1 wrote:

I have done a search on the forum and I can't seem to locate any posts about NFCUs Digital Investor service.  So I figure here is the place to ask.

 

I am looking to start investing some money in the market and, since I am a member already, the service looks to be a good fit for me.  But I haven't any experience with investing other than an old deferred compensation plan that I cashed out years ago to fund a business.  Turns out that was a poor investment, but that is a story for another time.  sigh.

 

NFCU Digital Investor has a $3.50 /month fee per account,  no minimum investment to start, ability to buy fractional shares and what appear to my inexperienced eye to be low transaction costs. 

 

My intent will be to buy and hold some index funds and maybe a few individual stocks after I get myself comfortable. 

 

I already have two pensions (one I am already receiving and the other will start paying in five years) and I hope to be able to collect my Social Security when the time comes.  I have a small 401K that I am maximizing the employer match for, as well.  I'm looking to build a savings that will return higher yields than a savings account or CD but be accessible if needed sooner than when I will eligible to start pulling from my 401k or HSA accounts without penalties.  

 

The positives that I see with Digital Investor are that the bar to entry is low, I have NFCU membership and the checking account already set up and the fees don't seem high.  I don't have the experience to identify the negatives.

 

Do those of you that have experience with investing have any thoughts, advice, cautions, etc. that you are willing to share?  I really appreciate it. 


1.  Stocks are risky; I wouldn't put money in stocks that I'm not prepared to lose.

2.  Since you have a 401k, depending on how it's invested, you may already be subject to stock market risks.

3.  Transaction costs in consumer type brokerage accounts are not always transparent... e.g., the spread between bid and asked prices. Some brokerages are better than others in reducing that.

4.  I wouldn't pay a monthly fee to have a brokerage account.

5.  Chase bank offers a trading account that has no fees at all on transactons.

6. One of the risks of stock market investing is reliance on a single stock or small number of stocks, so that particular part of the risk can be reduced by using no load mutual funds instead of individual stocks.

 


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 2 of 21
EAJuggalo
Established Contributor

Re: Navy Federal Credit Union Digital Investor Service?

I use Stockpile for fractional share investing for my personal use in addition to having two retirement accounts through my employer.  Stockpile charges no fees and are able to trade in most stocks.  I'm not planning on selling any of these anytime soon so I'm not going to put too much research into finding the absolute best product.

EX700 TU 704 EQ 694 4/03/22
Cap1 QS-$4,500 Chase Freedom Flex- $800 Chase Freedom Unlimited- $1,000 Victoria's Secret- $1,200 Citi DC- $800 Amazon Store Card- $3,500 AMEX Hilton Honors-$1,000 Discover It-$1,000 Wal-Mart MC $290 Chase Sapphire Preferred-$5,000 NFCU Flagship $13,800 AMEX BCE-$1,000 AMEX Gold-$5,000 AMEX Delta Blue $1,000 Lowe's $5,000 Navy Platinum $17,000 AMEX BBP $2,000
Message 3 of 21
TheFIGuy
Established Contributor

Re: Navy Federal Credit Union Digital Investor Service?


@Have1 wrote:

I have done a search on the forum and I can't seem to locate any posts about NFCUs Digital Investor service.  So I figure here is the place to ask.

 

I am looking to start investing some money in the market and, since I am a member already, the service looks to be a good fit for me.  But I haven't any experience with investing other than an old deferred compensation plan that I cashed out years ago to fund a business.  Turns out that was a poor investment, but that is a story for another time.  sigh.

 

NFCU Digital Investor has a $3.50 /month fee per account,  no minimum investment to start, ability to buy fractional shares and what appear to my inexperienced eye to be low transaction costs. 

 

My intent will be to buy and hold some index funds and maybe a few individual stocks after I get myself comfortable. 

 

I already have two pensions (one I am already receiving and the other will start paying in five years) and I hope to be able to collect my Social Security when the time comes.  I have a small 401K that I am maximizing the employer match for, as well.  I'm looking to build a savings that will return higher yields than a savings account or CD but be accessible if needed sooner than when I will eligible to start pulling from my 401k or HSA accounts without penalties.  

 

The positives that I see with Digital Investor are that the bar to entry is low, I have NFCU membership and the checking account already set up and the fees don't seem high.  I don't have the experience to identify the negatives.

 

Do those of you that have experience with investing have any thoughts, advice, cautions, etc. that you are willing to share?  I really appreciate it. 


Hey OP,  just my 2cents:

 

But you will get a broader index/buy-and-hold audience for investing questions here: https://bogleheads.org/forum/index.php 

 

I would say I'm a true boglehead and buy-and-hold VTSAX/VTI (Vanguard Total Stock Market Index Fund) in 80/20 split. 20% being International markets. I won't slide to bonds—(BND) for awhile as I believe I have more years left on my life lol.

 

I also would recommend an actual brokerage firm for investing: Schwab, Fidelity, Vanguard instead of NFCU (I know crazy talk)...

 

That forum will be able to help you with all your pressing questions! There are stickies that will answer a lot of buy-and-hold questions + index funds recommended for long-term investing.

 

Goodluck OP!

Message 4 of 21
Have1
Regular Contributor

Re: Navy Federal Credit Union Digital Investor Service?


@SouthJamaica wrote:

@Have1 wrote:

 

Do those of you that have experience with investing have any thoughts, advice, cautions, etc. that you are willing to share?  I really appreciate it. 


1.  Stocks are risky; I wouldn't put money in stocks that I'm not prepared to lose.

--  I agree that the risk to principal is real. 

 

2.  Since you have a 401k, depending on how it's invested, you may already be subject to stock market risks.

--  My employer does a match and the investments are what they are.  The 401K is aimed at unschooled workers who don't know, or want to know, what it is other than "retirement" money.

 

3.  Transaction costs in consumer type brokerage accounts are not always transparent... e.g., the spread between bid and asked prices. Some brokerages are better than others in reducing that.

--  That's the thing.  I'm trying to figure out what is a reasonable cost to buy.

  

4.  I wouldn't pay a monthly fee to have a brokerage account.

--  Fair.

 

5.  Chase bank offers a trading account that has no fees at all on transactions.

--  I have a Chase Amazon card so I will take a look.

 

6. One of the risks of stock market investing is reliance on a single stock or small number of stocks, so that particular part of the risk can be reduced by using no load mutual funds instead of individual stocks.

--  My plan is for index funds mainly.  The possible single stock buy would be an exception.  


 Thank you for your thoughts.   

 

Message 5 of 21
Have1
Regular Contributor

Re: Navy Federal Credit Union Digital Investor Service?


@TheFIGuy wrote:

@Have1 wrote:

Do those of you that have experience with investing have any thoughts, advice, cautions, etc. that you are willing to share?  I really appreciate it. 


Hey OP,  just my 2cents:

 

But you will get a broader index/buy-and-hold audience for investing questions here: https://bogleheads.org/forum/index.php 

 

I would say I'm a true boglehead and buy-and-hold VTSAX/VTI (Vanguard Total Stock Market Index Fund) in 80/20 split. 20% being International markets. I won't slide to bonds—(BND) for awhile as I believe I have more years left on my life lol.

 

I also would recommend an actual brokerage firm for investing: Schwab, Fidelity, Vanguard instead of NFCU (I know crazy talk)...

 

That forum will be able to help you with all your pressing questions! There are stickies that will answer a lot of buy-and-hold questions + index funds recommended for long-term investing.

 

Goodluck OP!


Thank you for your thoughts.  I will check out bogleheads.  I'll take a look at those firms again.  It's been a long while since I looked at them but I seem to remember there being a several thousand dollar ante to use them.  And a lot of marketese and buzzword bingo.  I'm quite allergic to both.

Message 6 of 21
tortoise_credit
Regular Contributor

Re: Navy Federal Credit Union Digital Investor Service?

I'm also a Boglehead, and Fidelity is a great platform. There's no minimum investment, and they currently have an easy to get free $100 promotion: https://www.fidelity.com/go/special-offer


 FICO 8Inq/1230/60/90 LatesAAoA
EX78114/0/09 yr 3 mo
EQ79313/1/08 yr 6 mo
TU77714/0/18 yr 9 mo
Last updated: 4/3/2022
Message 7 of 21
Anonymous
Not applicable

Re: Navy Federal Credit Union Digital Investor Service?

I would second what @TheFIGuy said. You should go with Charles Schwab, Fidelity or Vanguard. There will be no monthly fees or transaction fees to invest in index funds with them. I believe Vanguard still has a high minimum to invest in their S&P 500 index fund ($3,000), so the other two might be better if that is too high of a minimum. Start with their S&P 500 index funds and broaden out to other index funds later. They each have their own low cost version.

 

Fidelity has FXAIX. Expense Ratio of 0.015% and $0 minimum.

Charles Schwab has SWPPX. Expense Ratio of 0.02% and $0 minimum.

Vanguard has VFIAX. Expense Ratio of 0.04% and $3,000 minimum.

 

All of these index funds follow the S&P 500 very closely and are very cheap. They have all been around for quite a while, so we have a good track record for them. You can't go wrong with any of them. I am more interested in splitting my investments between different index funds myself rather than doing a total market index fund. I have more control over how much of my money is invested in small vs. large companies at any given time.

Message 8 of 21
Anonymalous
Valued Contributor

Re: Navy Federal Credit Union Digital Investor Service?


@Have1 wrote:

I have done a search on the forum and I can't seem to locate any posts about NFCUs Digital Investor service.  So I figure here is the place to ask.

 

I am looking to start investing some money in the market and, since I am a member already, the service looks to be a good fit for me.  But I haven't any experience with investing other than an old deferred compensation plan that I cashed out years ago to fund a business.  Turns out that was a poor investment, but that is a story for another time.  sigh.

 

NFCU Digital Investor has a $3.50 /month fee per account,  no minimum investment to start, ability to buy fractional shares and what appear to my inexperienced eye to be low transaction costs. 

 

My intent will be to buy and hold some index funds and maybe a few individual stocks after I get myself comfortable. 

 

I already have two pensions (one I am already receiving and the other will start paying in five years) and I hope to be able to collect my Social Security when the time comes.  I have a small 401K that I am maximizing the employer match for, as well.  I'm looking to build a savings that will return higher yields than a savings account or CD but be accessible if needed sooner than when I will eligible to start pulling from my 401k or HSA accounts without penalties.  

 

The positives that I see with Digital Investor are that the bar to entry is low, I have NFCU membership and the checking account already set up and the fees don't seem high.  I don't have the experience to identify the negatives.

 

Do those of you that have experience with investing have any thoughts, advice, cautions, etc. that you are willing to share?  I really appreciate it. 


I agree with other posters that a credit union would not be my first choice for investing. Vanguard, Fidelity, and Schwab are the obvious choices, though some of the newer fintech investment platforms like M1 Finance or Betterment seem pretty solid and may have a more friendly interface for newer investors. Just stay away from apps like Robin Hood that encourage day trading, because that's just a form of gambling. Low fee index funds or ETFs should be the core of your portfolio. Avoid actively managed funds: Over time and after costs, they all lose to index funds. I third the Boglehead recommendations of @TheFIGuy and @tortoise_credit. Jack Bogle's disciples know what they're talking about, and more importantly they have the right approach.

 

But have you considered the other options? If you're close to retirement and think you may need the money sooner rather than later, the goal should be more about preserving wealth than gambling on potential gains. The stock market is the best place for money for people with long time horizons (say 30 years from retirement), because over any sufficiently long period it will beat any other investment. But over shorter time frames, it's highly volatile. Even if you minimize your risk by investing in broad-based index funds instead of individual companies, the stock market could easily crater sometime in the next 5 years, and you might lose 30% or more of your investment just when you need it. Bonds are a traditional refuge. Less potential upside, but shallower dips. Just be aware that bond funds have a poor track record recently, and are less tax efficient than stocks, so you'll pay more on any gains if they're in a taxable account.

 

A specific short term option that might be appealing is I Bonds. They're indexed for inflation (CPI-U), with the rate adjusted every 6 months. Their current APR is 6.12%. They won't increase your wealth over time, but they can prevent your money from losing value as prices rise. The downside is you have to buy them from the government itself (Treasury Direct), there's a limit of $10,000/year (+$5,000 if you pay with a tax refund), and you can't cash them in for a year (if they're between 1 and 5 years old, you can cash them in but lose 3 months of interest).

 

If you haven't already, you should start by putting together a list of all your assets and liabilities, and calculate your net worth. The most important aspect of investing is asset allocation, or figuring out how much of your money you want to be allocated to different categories, and the first step in that direction is figuring out how they're currently allocated. This needs to be done from the perspective of all your assets, not from the perspective of each individual account -- if your goal is a 75/25 allocation and you have $10,000 in an 401k that's invested in a mutual fund with a 75/25 allocation, you may think you've met your goal. But if you also have $10,000 in a money market account, you haven't (that's a 38/62 split).

 

Depending on your income, you may qualify for a Roth IRA, and Roths are more flexible about withdrawing money than 401ks, so that may be worth a look. You could even rollover and do a Roth conversion of some of your 401k, though whether that's worth it can get complicated.

Message 9 of 21
Have1
Regular Contributor

Re: Navy Federal Credit Union Digital Investor Service?


@tortoise_credit wrote:

I'm also a Boglehead, and Fidelity is a great platform. There's no minimum investment, and they currently have an easy to get free $100 promotion: https://www.fidelity.com/go/special-offer


@tortoise_credit and @Anonymous 

 

I'm sorry for the late reply, I don't really have time during the week to sit down and write out replies.  

 

I will be spending some time on bogleheads.  And I will start researching Fidelity, Vanguard and Schwab anew.  It has been a few years.

Message 10 of 21
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.