Paypal at 5.03%

[mom-from-missouri]

Does anyone keep money in a paypal account? I just noticed they are at 5.03%.

[disneysteve]

I do. I started the account years ago when I was selling on ebay big time. Now, I only sell occasionally (and buy occasionally) but when rates climbed, they were actually one of the top yields for a while, even listed in Money and Kiplinger's in their rankings. So I transferred most of my emergency funds into that account because it was way outperforming the MMA I had. Simple to use and I've had no problems at all.

[sparkysgirl]

they are not fdic insured and that makes me nervous. I don't keep large amounts in there at all.

[disneysteve]

Originally Posted by sparkysgirl

they are not fdic insured

The money I have in stocks, mutual funds and bonds isn't FDIC insured either. A very small percentage of my portfolio is insured.

As for money market funds, not one has ever lost money in modern history.

[sweeps]

Why risk keeping money in a non-FDIC insured account especially for an inferior interest rate? Just keep enough in your Paypal to cover ebay transactions. Put the rest in a safer place.

[safari]

I've heard horror stories about PayPal freezing the money in people's accounts for various reasons. I never keep even a penny in my PayPal account. The minute I receive a payment for my eBay auction, I initiate a transfer to my checking account. When I pay for the stuff I bought on eBay, I always use a credit card with PayPal, and never an instant transfer (for the same reason I never make purchases with a debit card).

[BillsGirl]

Originally Posted by safari

I've heard horror stories about PayPal freezing the money in people's accounts for various reasons. I never keep even a penny in my PayPal account. The minute I receive a payment for my eBay auction, I initiate a transfer to my checking account. When I pay for the stuff I bought on eBay, I always use a credit card with PayPal, and never an instant transfer (for the same reason I never make purchases with a debit card).

so I have been wondering bout this... say you get the money and instantly transfer it to your bank, and then paypal wants to do one of those horror stories to take the money, wont it come out of your bank account???

I have noticed the % is dropping, and i have read that it is possible to lose money the the market account... if you lose money will the deduct it from your bank account?

[jc3900]

they are not fdic insured and that makes me nervous. I don't keep large amounts in there at all.

Heaven forbid there is a place that is not fdic insured!

[Slug]

Originally Posted by BillsGirl

so I have been wondering bout this... say you get the money and instantly transfer it to your bank, and then paypal wants to do one of those horror stories to take the money, wont it come out of your bank account???

I have noticed the % is dropping, and i have read that it is possible to lose money the the market account... if you lose money will the deduct it from your bank account?

The likely of a money market account actually going negative is low low low. however, the risk exists if the low risk assets the fund is holding turn out to be higher risk and default (e.g. the current mortgage mkt.). I have placed 5 figure amounts of $ in PayPal when the rate is good. Right now you can do much better in a multitude of other internet banks that are FDIC insured.