vB Easy Archive - Paypal Money Market Fund

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Paypal Money Market Fund
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Posted by: ChrisHI

Anybody know what the Paypal Money Market Fund is all about and how it works? Could you please explain to me?

Thanks.

Posted by: zerokarma

I'm interested too, I'll check their website in a bit.....

Posted by: SuperCM

All they do is take your money and dump it into a money market fund. It's the same thing I think ING Direct does, and that is why they are able to offer much higher interest.

However, why give PayPal your money when your bank already has it? Just visit your bank and talk with a financial advisor and they can tell you about money market funds.

The risk of these funds are minimal, since they only way you could lose money is if the economy for your country collapses - like it did in Argentina. Things to note though is they tend to put a "hold" on whatever you put in, so you like can't take it back out for a few days and it takes a day's notice to get your money back.

Still, much more fluid than something like a GIC and the rates will fluctuate with the markets rather than being locked in at some rate that might not look so nice down the line. Or the other way around.

Posted by: drudown799

Though the only thing with traditional banks is that they often require min. deposit for money market accts.

Paypal uses whatever balance you have, and returns a monthly dividend on it...

I think APR is at like 1.79% right now, or something like that.

Posted by: ChrisHI

Hey Dru,
Someone told me that If I put money into the Money Market Fund, that I would have to pay all sorts of taxes and what not. Is this true? If I dump some money into there and just let it build up over time, when I request the money back, is the interest or whatever it made mine to keep?

Thanks.

Zerokarma, did you check it out yet?

Posted by: Ninja

If I were you I would invest my money somewhere else. I just moved all remaining funds from my regular PayPal account to my bank account. The reason is this guy I sold a phone to on eBay ripped me off by contacting his credit card company and denying the charge. Even though I followed all of PayPal's rules to be protected by their, "Seller Protection Plan" they reversed the charge and it was pending for over a month. Their idiotic plan is suppose to protect me by giving me my money back now while they do their investigation. Well they said in the case of a chargeback they have to give the money back, closed the case, and told me I was on my own. So I am out almost $500. I am trying to get my money back from FedEx now since they delivered it. So another month I have to wait to get my money. Sorry to be kinda off topic and rant & rave but I would think long and hard before giving PayPal ANY money. I just wished I had moved it into my bank account before they could get their hands on it.

Posted by: zerokarma

That happened to me once, some idiot paid me with Paypal so then I shipped him the item but then when he got the item he gets all mad and says I ripped him off with the shipping which I didn't but anyways what he does is says to Paypal that he never received anything to they friggen reverse the payment *without* even asking me about the matter. Like what the hell? They don't even get my side of the story.

Well anyways I threaten to get him charged with mail fraud so he came to his senses and resent the money but he didn't give me all the shipping money so I ended up losing a bit of money on that one but at least it wasnt a total loss.

Posted by: drudown799

Quote:

Originally posted by ChrisHI
Hey Dru,
Someone told me that If I put money into the Money Market Fund, that I would have to pay all sorts of taxes and what not. Is this true? If I dump some money into there and just let it build up over time, when I request the money back, is the interest or whatever it made mine to keep?

Thanks.

Zerokarma, did you check it out yet?

You can find other places to put your money, but Paypal isn't bad... the whole credit card charge thing... thats a totally differenty "side of it". If you're just using paypal to gain intrest on money, and don't use it for ebay/auctions, there is nothing to worry about.

Keep in mind that money market funds aren't insured by the FDIC (I believe - correct me if I'm wrong, cuz I'm not that familiar with them), so they could loose value.

About taxes... you will have to technically report your income on the money market account, however, and pay Capital Gains tax on it, I think... however, if you don't gain much, I don't think they'll even bother taxing it... (I don't keep that much money in mine... maybe $50, and I got 5 cents a month last year for 8 months)... I don't even report that kinda stuff. That's if you do your own taxes...

Drew