Getting involved in things like investments is a great financial choice that many people are starting to make. More often than not, people have assumed that the stock market and other forms of financial investments are only for those who are skilled and learned in those areas.
This could not be further from the truth. Investments, stocks, securities, and the financial industry are open to anyone and everyone who wants to make smart financial decisions and build wealth. That is why Treasury Direct is such a useful tool.
For US citizens who are interested in financial investments, Treasury Direct offers a secure method to do so. However, there have been some reports of confusion while setting up accounts for some people.
This comes in the form of an option in the process labeled ‘check to remove hardlock’ with a box beside it that can be ticked. Many people seem to be unsure of what this step on the signup form means, and that has led to widespread confusion.
This article will be explaining exactly what the ‘check to remove hardlock’ option means, as well as what Treasury Direct is, how to use it, and all about securities. With this, more people will develop comprehensive investment knowledge and be interested in investments.
What does check to remove hardlock mean?
So, what exactly does this option mean? If you are not sure of what the ‘check to remove hardlock’ option is, we will explain. In order to use Treasury Direct, you will first have to set up an account on the website.
While you are filling in the necessary fields to create an account on the website, you may come across this option at around the halfway point of the form. That is the option labeled ‘check to remove hardlock’ with a box beside it that you can tick.
If you are filling out this hardlock form alone, you may not have anyone to ask. In some situations, even people who were filling out the form at banks or any other financial institution were unable to get clear answers on what the option meant.
The ‘check to remove hardlock’ option is simply one that is available for people reopening accounts after they have been locked. The hardlock on the account is issued if there have been suspicions of fraudulent activity on the account.
Once your account has been flagged for suspicions of fraudulent activity, the hardlock is issued, which locks you or anyone else that has been accessing it out of the account. When the claims have been reviewed and you want to return to your account, you will have to remove the hardlock.
There are no remove hardlock instructions and the only way to remove hardlock from your account is to check this option when returning to your account. Checking the box also verifies that you are not a bot to the computer. Once this is done, a new page will load and you will be able to access your account again.
Therefore, if you are creating a new account for the first time or you don’t have any experience using Treasury Direct check, you do not have to worry about that option as it doesn’t concern you. Just move past the option and continue filling out the form to create your account.
If you have no idea what Treasury Direct is and you just happened to stumble upon this article, don’t worry, you are still in the right place. If this is your first introduction to Treasury Direct, we will be explaining all about it as well as how securities work.
What is Treasury Direct?
Treasury Direct is an online platform created by the United States government to allow citizens and investors to purchase government securities directly from the US Treasury. It is the only platform of its kind that connects people directly to the US Department of the Treasury.
With Treasury Direct, people can both buy and redeem securities in an electronic form that is easy to manage, trade, and profit off of. The platform is popular and trustworthy because it is directly connected to the Treasury Department of the United States.
Treasury Direct also handles the issuing of new US Treasury Bills and other items like savings bonds, notes, and more. With the platform, investors can interact directly with the Treasury Department instead of dealing through brokers, banks, and other types of middlemen.
Treasury Direct is a product of the US Department of the Treasury Bureau of the Fiscal Service. Their goal is to borrow the money needed by the government to function properly and manage the debt that arises due to that borrowing.
They do this by offering investors various options for savings and investments through securities and other financial products. Treasury Direct also provides information, research platforms, and education on investment and trading.
How does it Work?
The primary feature of Treasury Direct is its trustworthiness because it is fully backed and credited by the US government. The platform sells different financial products such as Treasury bills, bonds, Treasury Inflation-Protected Securities (TIPS), and more.
All of these transactions take place on the Treasury Direct official website which serves as the only portal that the US Treasury operates from to sell securities. There are no other platforms that the Treasury sells securities through, so beware of any frauds.
The Treasury Direct website allows users to create accounts that they can then link to their bank account. This way, they deposit and withdraw money to and from their bank accounts to use to purchase securities and other items.
By using Treasury Direct, investors no longer have to deal with brokers and banks when they want to purchase securities or invest in the government. This also means that all commissions and fees are totally eliminated from the process.
The securities on Treasury Direct are sold by auction on the platform. The auction establishes the rate and yield of the security and allows investors to place bids that can be either competitive or non-competitive.
A competitive bid is one where the bidder specifies the yield, rate, or discount margin that they want. A non-competitive bidder doesn’t do this and instead is content with the yield, rate, and discount margin established by the auction listing.
The auction goes on and different bidders win. When the auction is over, securities are issued to bidders in an order. First, the non-competitive bidders receive their securities, then the competitive bidders are issued their securities from the lowest to highest bids. The issuing ends when all the securities offered in that auction have been sent out.
Treasury Direct has a minimum required investment rate which is a hundred dollars. Investors are not allowed to make bids or investments for cheaper than that rate.
How to open a Treasury Direct Account
Opening an account with Treasury Direct is free and takes less than 20 minutes in total. The process is designed to be as easy as possible for the customer with straightforward steps and plan questions and fields. This can be done on the Treasury Direct site.
Treasury Direct check accounts can be opened by individuals and entities such as limited liability companies, estates, sole proprietorships, and more. The account holder must have a valid Social Security Number, must be legally competent, and must be at least 18 years old.
Parents or guardians can set up accounts for minors who are below 18 years of age but the minors cannot operate the account until they come of age. For a legal entity or business, they must have a valid Employer Identification Number or Social Security Number for their business.
Other qualifications for opening an account with Treasury Direct include having a United States address that they can be reached at as well as a valid account at a United States-based financial institution that accepts debits and credits.
The platform requires that users have a stable internet connection while setting up their accounts. You will also need a valid email address. When you have all of this information ready, you are ready to set up your Treasury Direct account.
Personal information that will be requested to set up your account includes your name, phone number, email address, address, State Identification Number, bank account information, Social Security Number or other Taxpayer Identification Number, and some more.
The purpose of requesting this personal information is to properly identify the account holders and verify that they are real and trustworthy people. Your personal information is safe with Treasury Direct as the site has a very high quality of security.
When you have inputted all your information, you will be asked to create a password. Your password should have at least 8 characters, not counting spaces, and must include at least a letter, a number, and a special character.
You will also have to set a password reminder in case you are having problems remembering your password. Treasury Direct doesn’t allow people to set their password reminder as the same word as their password for security purposes.
After setting your password, you will also be asked to set three security questions as an extra layer of protection. These are needed to verify your identity if you ever need to prove that the account belongs to you.
Your security questions are also asked when you want to perform some transactions on the platform. Users are free to change their security questions or edit them when necessary, but they will need their passwords to do this.
The final step is to include a personalized image and caption for your profile. These can be changed at any time but are a final step in verifying the authenticity of users of the platform. With all of this information provided, the platform verifies your information and sends an email including your new Treasury Direct account number.
The search field on the Treasury Direct website can be used to access their frequently asked questions if you still have any questions or concerns on how to open and set up your Treasury Direct account.
What is the fs form 5444?
This is an account authorization form that anyone trying to create an account on Treasury Direct may need to fill out. It is a paper form that usually requires that people download and print it out, fill it and mail it to Treasury Direct. On the fs form 5444, the person creating the account needs to get a signature guarantee.
The form is issued when people run into problems with identity verification while setting up their Treasury Direct account. The purpose of the form is to verify the person’s identity so that they can continue the process to register. People can now sign documents online faster using signing websites and software.
The document can now be signed online though as legal forms no longer have to be printed out to sign. The purpose of the form is to verify the identity of the person trying to create the account and Treasury Direct runs identity verification through a third-party service.
The fs form 5444 is needed because Treasury Direct doesn’t have any physical locations. Where other institutions may request that you show up with your means of identification, the online form is the only method of verification for Treasury Direct.
Checklist for opening a Treasury Direct account
· Social Security Number or Employer Identification Number
· US address
· Checking or savings account in a US-based financial institution
· Valid email address
· Phone number
· State Identification number or driver’s license
What are securities?
A security is a fungible financial instrument that is negotiable and holds financial value. They come in different forms and can be representative of different types of monetary value. This can include ownership in a corporation, creditor status, or rights of ownership.
Securities are tradable and can transfer from one owner to another. They are used to raise capital and can be traded in both private and public markets. The SEC regulates most public sales of securities while some self-regulatory organizations regulate the private sector.
Securities are bought and sold on the US stock market and are federally legislated under the Securities Act of 1933. This act ensures that people selling and buying securities are open and honest about their business practices.
The most common examples of securities are stocks, bonds, and other financial items traded on the stock market, however, there are many more examples of securities and they can be broadly divided into three different types of security.
The criteria for an investment being categorized as a security include that it is an investment of money, there is an expectation of profit from the investors and the profits are stimulated by third-party prompters.
Types of securities
There are three main types of security which will be explained below:
Equity
Equity security symbolizes ownership of shareholders in a public entity. The entity may be a trust, company, or partnership. Equity shares exist in the form of stocks that can be bought by individuals or other entities.
Profits from equity securities are made mostly through capital gains. Equity securities do pay dividends but the primary means of generating profit is by capital gains after selling the securities. The value of the securities fluctuates and the business model involves observing when the right times to buy and sell are.
Possession of equity shares means that the holder owns a percentage of the company and therefore possesses some degree of control of the entity. The more shares an individual or entity has in another entity, the more voting power they have in the entity.
Debt
Debt securities represent money that has been borrowed and must be repaid. The security is in the form of a loan and the loan terms clarify the loan size, the percentage of interest rate, and the renewal date if any for the loan.
Debt securities are commonly in the form of government and corporate bonds which are sold out to the public and paid back at interest. Other examples of debt securities are certificates of deposit and collateralized securities.
These are a very secure type of security as there is no fear of fluctuation. People who hold these do not have to waste time hoping for the security to gain value. Rather, there is a fixed price, a fixed rate, and a fixed return date.
The issuer redeems the security when it has come to term and can decide to renew it if they desire. Debt securities can also be secured or unsecured. Secured securities are backed by collateral while unsecured ones are not.
Hybrid
These are a combination of the features of both debt and equity securities to provide the best of both worlds. Examples of hybrid securities are equity warrants, convertible bonds, and preference shares.
Conclusion
Making use of Treasury Direct is a great way for the average person to start making smart investments that are safe and secure. Treasury Direct is easy to use and understand and can yield great profits for users.
The receipt of each profit from investments encourages users to keep investing. When you come across confusing messages like the ‘check to remove hardlock’ one, don’t be discouraged. It is only an option for specific Treasury account holders and can be easily ignored.
