HYSA

Newbiewhitekicks

r/Fidelityinvestments, Vanguard, and r/Schwab are all real brokerages, and excellent choices. If you choose Fidelity, then use FSKAX/FTIHX. Vanguard is VTI/VXUS and Schwab is SCHB/SCHE/SCHF. Dividends haven’t been a useful investing tool for over a decade and in general are not needed. Total return is all that matters. If you need cash; sell stock. Dividends are just a forced sale; a performance drag; and a tax drag. Essentially, you’ll have more money if you don’t invest in a dividends. You can keep your saving in your money market account in Fidelity, Schwab, or vanguard; most HYSA don’t actually return anything. Some other resources to explore: r/portfolios, r/bogleheads

bkkmatt

Basement dwelling idiots. He doesn’t hold any of the stock. If you like 2-4% gains on 500K, just park it in a HYSA.

0o0o0o0o0o0z

> I have a little under 2 yrs until I retire at 59.5 and my question is in regards to 401k contributions. My company matches 50% of the first 8% that I contribute. I currently contribute 17% but I'm thinking about dropping that to 8% and then using the 9% increase in my paycheck to build up my CASH reserve. TBH, I tell everyone to do this: put it toward the match, then put the rest into a HYSA/MM or your normal retirement investment portfolio. You should never rely solely on a 401 (k) or SS.

Samjabr

I asked claude to evaluate my portfolio, it suggested I close my account and move all my $ into a HYSA 😢

PassableForAWombat

That's not even that defensive now :/ HYSA only beats out inflation barely

Most_Atmosphere8365

If the market doesn’t eventually start trending upwards again we got bigger problems than worrying about retirement 😂 that would be when bread lines start forming, people need wheelbarrows of cash to buy a loaf, and riots start happening as our economy hypothetically crumbles into absolute oblivion. I would concur that I think the market ***may*** see a nasty downturn in the coming years since there was essentially a bailout during Covid that kicked the can down the road. If you truly feel that way then stick with a small recurring buy to at least start building a portfolio or maybe even a smaller one time buy then set recurring purchases, and save the big lump sum for when a downturn starts to flatten or reverse so you can really press the gas and utilize your large sum of capital for when it means the most. But keep in mind that a bubble can continue for years. Could be 2030 or even later when a true downturn happens. It could also start in December of this year. Idfk and anyone who tells you they “know when” is absolutely lying through their teeth. There’s a saying “*time in the market is better than timing the market*” which couples wonderfully with the saying “*the markets can remain irrational longer than you can stay solvent*.” Essentially we can’t see the future, so stop trying to see the future. Just recurring buys, and when you see the opportunity to be aggressive don’t hesitate to be aggressive. Someone did a backtest where if you bought ***only*** at the very top before every major downturn your portfolio would still have roughly tripled from the top before the dot com bubble to now if I recall properly. Idk if Fidelity does partial shares, some brokers do, which is great if you can only afford to siphon off like $100-$200 a paycheck if the ETF you’re accumulating costs like $700 per share. You wouldn’t have to wait months to get one whole share, you could just get 1/7th of a share every payday. Also, short-term T-bills are a good idea if you wanna save the lump sum for a downturn and have well over the 6 months of emergency funds that you don’t wanna keep in one place. Rates are really good right now for T-bills (one of the reasons people think a crash coming is because the market is pricing debt (bonds) as if a crash is near), I think a 1yr T-bill is *almost* 5% return currently which is comparable to any HYSA but the rates on bonds lock in and your HYSA can change rates. The other side of it is that your money is locked up too in a bond so there’s pros and cons to everything (you could of course sell the bonds early but bonds are their own animal with par values, yields, taxes, etc.. I learned all about those fuckers when studying for my Securities Industry Essentials exam)

Most_Atmosphere8365

If you’re long-term investing just choose a reputable broker instead of some shady offshore BS, Fidelity is fine. You only start needing more expansive/comprehensive broker platforms for more complicated forms of trading like scalping. Basically any S&P 500, NASDAQ, or broad market ETFs are good. Always have most of your portfolio in these types of vehicles; these are the retirement prep. If you wanna find the next NVDA use a small portion and be prepared to be wrong. Finding the next “big one” is called speculating. That’s a fancy word for guessing with your gut, which is unreliable. Dont try to pick single stocks, don’t try to time anything; just invest small amounts consistently (maybe with a small lump sum to get you started, ensuring you keep at ***least*** 6 months of emergency funds in that HYSA). In terms of saving for retirement, boring is better. Let compounding do the work for you. In the event of a big pullback during a recession or depression, don’t panic and sell; look at it as an opportunity to get more shares for less money. This is why as you get closer to retirement you diversify into fixed income assets because you won’t have the time to recover from drawdowns and protection of capital becomes the focus instead of growth. If you dump $10k into VOO and we get a 50% crash in two years, don’t think “I’m down $5k” but rather “I can triple my position for the same $10k and ride the next wave up.” Imagine this; VOO is @$700, you can get \~14 shares for $10k. Next year say it crashes to $350. You can now get 28 extra shares for the same $10k, and you have 42 shares total now. If it goes back to $700 your position is now worth $29,400. This is obviously a hypothetical scenario, just giving an example. That’s why I hate bailouts; it strips young investors of the opportunity to buy valuable assets for cheap because the old fucks want daddy to save them. Crashes are good; they bring ample opportunity for younger generations with less wealth accumulated to size up and build their portfolios for the next bull runs. Here’s some interesting comparisons from the bottom of ‘09 versus current valuations of well known companies: ***Apple (AAPL): \~$2.50 -> \~$340*** ***Microsoft (MSFT): \~$11 -> \~$530*** ***Amazon (AMZN): \~$3 -> \~$262*** ***Walmart (WMT): \~$13 -> \~$119*** ***Oracle (ORCL): \~$7 -> \~$129*** These crashes suck absolute ballsack for someone 3 years from retirement who didn’t shift to capital protection like my asshole of a grandpa (he truly is an asshole); but for those young guns out there these types of opportunities don’t just provide solid returns, they provide life changing opportunities. The ‘08 crash scares the shit out of my parents and they went fixed income for the last 18 years when really they should have doubled down given they both *still* work (and will for a few more years) so they had ample time to ride out a recovery in the event of a subsequent downturn. Now they both spend every other day going over their retirement numbers, pensions, etc. because they stuck themselves with 2-3% earnings for almost two decades and grew almost nothing. I wish I had the knowledge then that I have now because they’d be rolling in dough, but alas I was a little tyke back then worried about what pizza we were having on Friday. My mom had one pension that was stuck on the market and she couldn’t change it to fixed rate; that one pension has done 150% over the last \~20 years, meanwhile their fixed rates haven’t even really touched 1/3 of that. When you see and feel financial struggle firsthand it gives you a drive to learn like you wouldn’t believe. Just keep learning and keep diving. Asking questions means you’re in the right direction. Best of luck to you.

ChainmanAtHeart

Fidelity is fine but it’s hard to read for a beginner. Robinhood is criticized for complex reasons and is easy to use. It shows you better graphs and makes things easier than any other app. As long as you don’t mind it trying to sell you Robinhood gold. Dividends are good, but the rule of thumb is: dividends always underperform the market. If you’re going to put the money right back into the market, why use dividends? Generally dividend stocks are for people with a family or retired people who will spend the cash payouts on stuff they need, in lieu of watching number go up faster. Don’t invest money in stocks you might need in the next 5 years. If you invest and 2008 happens tomorrow, we’ll look like idiots for suggesting it. Step 1: max your 401k match if works offers it Step 2: keep six months of expenses in an emergency fund. HYSA is good. Bond funds are also good because they don’t go down in a crash. I keep mine in SGOV which pays 3.8% Step 3: put the money you’re saving into VOO or VT. The other funds you listed are fine. Step 4: Turn brain off. Seriously. The more you know, the more you think you know. The more you think you know, the more likely you are to make changes. Changes lose money. Patience makes money. Nobody knows what will happen next year. But I do know that the 7% average return will pan out by 2037

jquest303

Besides the 401k and HYSA, I keep about 10k in cash in my safe at home. I’ve got enough invested to create wealth long term. I like to have a physical buffer at home for emergencies, just in case.

Valvador

I'm assuming you meant HYSA, not HSA, right?

abeBroham-Linkin

SP500 index or an HYSA would be a safe bet, until he learns about investing.

interpreterdotcourt

I recommended a friend put his 50k into a HYSA with Marcus and I was even nervous about doing that.

Forded_Fiction24

Hysa Weathfront for emergency savings. Ally HYSA for more goals savings or incidental expenses that aren't true emergencies. SGOV holdings within our brokerage as a 3rd source of savings that would take 3-5 business days to get the money. Also have some very liquid assets that can be sold at any time otherwise but would be a contingency plan in a very large emergency 

Historical_Low4458

You should move your money to a HYSA where it is earning ~3.5%

AnselmoHatesFascists

A total 5% of their entire portfolio in theS&P? They could have the rest in other investments such as individual stocks, bonds, HYSA, international etfs, etc. We prob need more context to understand what they meant.

Hofnars

I've got 2 pensions that will take care of my retirement needs, my retirement wants are going to be taken care of by my 401k. 401k contribution (including match) is an average of 15% for the year, higher in winter, summer only upto company match and reduce automated contributions to other savings vehicles as well to free up money for recreational expenses and avoid dipping into savings for that. Roughly 10k in a HYSA, which will cover everything except a new roof in terms of emergencies. Everything else is going into after tax ETF's. Initially figured that if shit ever hit the fan I could sell those to cover, and if not it would grow faster than the HYSA. I've been doing this long enough to come out with a net positive, even if I were forced to do this during a downturn. After dialling in my expenses in terms of 'what things do I need to survive' I also don't maintain a budget. Everything that's left over at the end of the month goes into ETF, or replenish savings when neccesary. Pensions are nice, but they are not free. I imagine that without I'd be able to have make this work after increasing the 401k contrinutions, adding/maxing a Roth before going after tax ETF's. Sorry there's no math or ratio, I tried that and was never be able to stick since my expenses vary seasonally and either felt like shit sticking to it or lost the drive to save altogether when I didn't. It took me longer than it should have to realize that limiting expenses was more effective than forcing myself to save, but now that I've been there for a while it's done well for me.

Swred1100

Time horizon <3 years, generally HYSA, bonds, etc. Something with 0 risk. Time horizon 3-5 years, you can start taking some risk. Say you want a $50k downpayment saved in 4 years, you’d need to save $1,041/month. Maybe split that 50/50 broad ETFs and HYSA, bonds, etc. Time horizon 5+ years, equities.

steelnomad

HYSA bro here and beatin all yer asses 😂

throwawayawayayayay

If $110k is your 12-months of expenses and you're young with no house or car, then you spend way too much money. But the general answer to your question is that you should think of your positions as a scale of high risk to zero risk, with individual stocks being highest risk, then sector funds, then total market funds, then bonds, then CDs/MMF/HYSA, then physical cash. You determine your allocation strategy in terms of either percentages or fixed amounts. Figure out your range of tolerance for each. Then you adjust as needed - too much physical cash? - deposit it. Single stock rocketed to the moon? - sell some of it and buy some VT. But the key thing is that when you're young, you don't really have exposure to most emergencies. You're not going to need to call an emergency plumber in the middle of the night or have to stay out of work for a week with a sick kid. If you have no life obligations and you keep encountering emergency expenses, that's just bad planning and you should correct your expectations. And always have some cash on hand, including small denominations. You don't want to be in the aftermath of an earthquake or flood or power plant failure and be trying to buy drinking water with a credit card.

interpreterdotcourt

I have very little in CDs (just no penalty ones) and I think one locked in CD ladder set to open up every 3 months. yes I have the Tbills to avoid income tax in my state. quite a bit in some 4.5% HYSA (marcus but it's a hustle to get referrals only 3 months rn .. that was basically my question I only plan on doing this for a couple months , then diving into the market.

mightysockelf

Those are not all the same vehicle. If you invest into a traditional CD, you'll have early withdrawal penalties if you decide to get out before maturity. If you buy a short term secondary, you risk price fluctuation. T-Bills are fine, but the short term ones sometimes are no better than a brokerage money market or HYSA, and they'd only benefit you if you're in a state where you'd otherwise pay taxes on investment returns. If you're wanting to stay ahead of inflation on a higher amount of money, a 4%+ HYSA is fine for a year or two until taxes on interest pull it under. A higher interest Treasury will work for maybe a few years.

MaxDragonMan

If you're pessimistic, sell it all, put it in a HYSA or GIC, and hold until you feel better. These losses are pretty bad - best thing to do now is accept you're bad at it, and is to start saving, put that 42k in the S&P or a broader index fund of your choice, and start to just rebuild that pile and let compounding and time do the work.

Historical_Low4458

Money you need for short term expenses shouldn't be in the stock market. If you want to buy a car, etc, then that money should be in a HYSA (not the stock market).

GuidetoRealGrilling

Whatever I allocate for savings I split 75% HYSA savings 25% investing

Sea_Cry_3968

I sold everything early this year because that account was extra play money from an old 401k I cashed out about 8 years ago. Turned 8k into 50k. We had a savings account but it wasn't nearly substantial enough for our liking. I also realized that I became obsessed with checking stocks every single day waiting to see if I was making the right decision to hold or not. After selling, I deleted yahoo finance and stress I didn't even know I had disappeared. I have a very substantial retirement at work so making the decision to have a big goose egg emergency fund was the right decision for me and my family. It's now sitting in a HYSA and it's making about $120 a month which is good enough for me. Will I regret it long term when I probably could have turned it into a few hundred thousand, especially when half of it was in Nvidia, maybe. But my comfort and peace of mind today and for many years to come is priceless to me.

DontForgetTheDivy

There are a lot of options between these two. SGOV is basically HYSA and TLT is too much duration risk. SHY or IEI are options.

__redruM

The easiest thing is to time your planned big expenses such that they don’t occur with market crashes. You decide when you buy a house, you move the money to a HYSA when you start actively looking.

lasooch

And if it’s sitting in a HYSA, even if you withdraw 4% you keep getting inflated away. 4% is the SWR to withstand SORR but assuming higher average growth than HYSA. Not to mention if rates drop (whether tomorrow or in 10 years) you won’t be getting 5% there. u/Weekly_One8412 you may wanna research FIRE, we’ve got this stuff figured out, what you’ve got there is not it sadly.

drummer820

Smart plan under the circumstances man, take profits, throw a lot of it into a CD or HYSA and rest easy. If you are gonna retire in the next year or two it would be insanely risky to be deep into equities in this climate. If there’s a crash you can buy back in cheaper

TheSplines

Keep two years in HYSA as a buffer for downturns and put the rest in all equity index funds.

pk_12345

Assuming you’ll get 5% in HYSA for rest of your life?

TheAsianTroll

Retire and enjoy your life. 16 million in a HYSA will enable you to never work again and survive strictly off interest.

DaemonTargaryen2024

HYSA, money market fund, etc [https://www.investopedia.com/terms/c/cashequivalents.asp](https://www.investopedia.com/terms/c/cashequivalents.asp)

Vlisa

cash is a position, but I swear it is all HYSA only people

mwam22

If you can’t deal with risk, put your entire portfolio in safe debt securities. If you need this money liquid, put in a HYSA. Otherwise shut up and hold until the market rebalances

redditpossible

Transferring from ETF’s to HYSA now would secure a 3% loss during this downturn?

RealAlexJonesTM

Buy a multi-family piece of property with an FHA loan, put down a decent down payment, invest a few hundred grand in Vanguard ETFs and then keep 50-100k in a HYSA for your spending money. Or buy a ton of SOXL/MU/NBIS calls at the top and blow it all and ruin your life.

Geng1Xin1

I put 10% of my total account into SGOV, but I didn't do it because of any market winds, it just has a higher interest rate than my HYSA at the moment.

CosmoSein_1990

Keep a safety fund in a HYSA to have cash on hand when you need it in an emergency. If a recession does hit I would increase the amount in that safety fund to an amount that gives you some piece of mind. For your investments, keep the money invested and buy the dip.

RickDick-246

I haven’t pulled back, but I have slowed down my investing to have a larger HYSA. I’ve got some personal things going on where I’d just be more comfortable having extra cash on hand. Once I make it through the storm, I’ll dump it all back in but I’m fine missing out on 10-15% gains if that happens over the next year or so on the cash I’d be putting in.

br_k_nt_eth

Yeah, you’ve got a long road ahead. When you’re planning things out, plan for 20 years or so unless you want to retire early or something. That really changes one’s perspective.  Also, you remember what 2011 or so was like, right? It was mostly extremely shitty days and then a lot of stagnation, but it didn’t last forever. It never does. Do you have an emergency fund? Having 6+ months of cash in a HYSA or something similar that’s less exposed to the market isn’t exciting, but man does it help me rest easier. 

VisionQuest-3000

Statistics show the median IQ is about 100. Way too many below the median IQ act like they know everything and everyone else knows nothing. The stock market historically goes up with periods of time when it declines by a large amount. Simple facts on numerous investment sites. The stock market has been unstable for several months. Large or perceived large swings in either direction have occurred and are somewhat unsettling to see. My portfolio is still fairly diverse. A portion was recently moved to the TSP G Fund aka HYSA because of the 5.375% rate that has the potential to increase in November. Will that occur? Who really knows. Same for bonds.

RagnarokWolves

I have a six month emergency fund setup in a HYSA. This allows me to invest without worrying about market swings downwards. I invest 20-25% of my gross income from each paycheck into the S&P. (I built to that over time) I have accepted that I will leave this money invested for decades until I retire. If there's a market crash, that's an opportunity to get more shares on sale.

kingallison

Suitability and risk tolerance. How old are you? How much money do you have to invest? Can you afford to lose that money? It's pretty simple. If you have enough money that you don't need to use soon and find stocks that you think will increase in value over your time horizon, it probably makes sense to invest in stocks. If you're older and can't risk losing money for the reward of maybe getting substantially higher gains in stocks, it makes more sense to invest in bonds. It's also common to mix between both. Sideline money always in at least HYSA or Money Market, bonds are fine too. Bonds are also not the same as CD's. You can sell them if you change your mind. I'm 35 and am heavily allocated to stocks over bonds. But when I'm not buying stocks, my uninvested dollars are either in Money Market, SGOV, or short term bonds.

jdsmn21

And how upset would you be if that $8700 was now $7500 after 6+ months. If you’d be upset - find a CD or HYSA

Historical_Low4458

If you just need to park money for a short time before invrst8ng it, then a HYSA is the way to go. If you are actually looking to invest in something longer terms that is relatively safe with minimal taxes, then you probably want government bonds.

JaredMechanical

IF anyones looking for a high yeild savings account (HYSA) refferal link lmk. but i would do an ETF fk stocks

Round_Context_146

whats the best HYSA?

LockedOutOfElfland

First, know how much you have to set aside for taxes and put that amount into an estimated tax payment for the upcoming filing season. If you have any loans or debt, pay those off immediately. After that, either invest, like you're saying here, or put the amount in a HYSA you never touch until retirement.

fighting_gopher

My company also does a 5% discount…not worth the risk. Market tanks and the stock goes down by 1% from the purchase price and now it’s less than a HYSA

URMomPaysFirMyCalls

I think some of you are so regarded you use margin to buy into a HYSA.

Level3pipe

50k in an HYSA. This is your life emergency fund. The remainder: 10k a week over the next 45 weeks. There is no “timing the market” you’re young enough to not need to worry about that. Growth ETF + some dividend + Small Cap USA. I’d recommend 50% VTI 40% VBR 10% MPLX or SCHD mainly for the energy diversification. Although you may elect to put that 10% wherever you wish. After 45 weeks if you feel like you want to reduce that from say 50k to 20k or 30k you may consider investing in other things for diversification. Gold, Art, or investment in yourself (enjoyment/business/material/skills/schooling/medical/etc). Investments into the market is important ofc but don’t forget to invest in your well being too :)

i-amnot-a-robot-

What do you even mean - HYSA don’t lose money lol

Sensitive-Exam649

In my opinion you should: INvest în yura taxable account for dividned income. Enough to cover all of your living expenses. This will cover your living expenses if you lose your job or cannot work for any reason. plus 6 months of living expenses in cash for the occasional large bills. And eventually work up to maxing out your roth and 401K contributions. Now it looks like you living expenses are about 2K a amonth or 24K a year. You HYSA currently if invested in IWMI would generate about 1K a month of income You want 2K and you are half way there. Now this doesn't abandon your dreams of owning a home. but it may be delayed. Right now you don't have enough to income to cover the cost of owning a home or small condo. But building up dividend income can help making that dream a reality. Once you have 2K a month of dividend income you can use that income to cover your rent and food bill and desert the work income. Continue to build up the work income so that it eventually covers your your your brokerage deposits as well At that point you can increase your 401K deposit to the maximum. From ther keep building your income and eventually your income will be enough to get you a place of your own. funds I would recomend you use for dividends are qqqi, iimi, KGLD, EMO, UTF, UTG, and NAC (municipal bond fund for CA that is exempt from stat taxes.

RobinJeans21

My advice, which I’m sure is wrong. Pull out. Put it in a HYSA. Live off interest and still work.

imzadi111

HYSA went up at all my institutions. My best HYSA went up to 4.2%. Looking at CDs today as well. Saw one for 2 years a 4.6% and a bump up one for 20 months at 4.35%. I had not seen these rates for a couple years now.

SirGlass

Very common . The difference in yield is not the only benefit, if you live in a state with income taxes the yield on treasuries is state tax exempt what can make a bigger difference. That and you never have to chase the best HYSA. Banks play games if they need deposits they will offer competitive HYSA ; if they do not they won't. Meaning you great HYSA today might not offer an competitive rate in 1 -2 years from now. The great thing about short term bond funds like VBIL or SGOV is you always get basically the short term rate.

Dr_Zoonotikstein

Serious question from a guy who's happy to make $700 a day: If you can easily turn $7K into $70K, why don't you just stuff $63K into HYSA each time you do it?

TheImpPaysHisDebts

Treasury BILLS (TBills) are very short term (less than a year) government "backed" investments that pays you interest, but how it works is you buy the TBill at a discount and get paid the full amount at maturity. So FOR EXAMPLE you purchase a $1000 26 week TBill for $950 and in 26 weeks, you get $1000 (you made $50 interest that is not taxed at the state or local level, but is taxed at the Federal level). This sounds like what you want to do. Treasury BONDS are very long term (20-30 years) government "backed" investments that pays you interest every 6 months. So again, FOR EXAMPLE, you buy a 20 year BOND for $1000 and it pays you $5 every 6 months in interest (taxed the same way as TBills). At maturity, you get the face value of the bond back (in my example $1000). Treasury NOTES are medium term (2-10 years) government "backed" investments that pays you interest every 6 months. They are basically the same as Bonds, but they typically pay a lower rate - so in my example maybe you get $4 for a 10 Year Note or $2.50 for a 2 Year Note. Tax treatment is again the same. Normal interest in a bank account is taxed as regular income levels at the federal, state, and local levels. All 3 types of treasuries GENERALLY pay slightly higher interest than a high yield bank account, but your money is much harder to access and liquidate in an emergency. For example you can sell that $1000 BOND before it matures, but you may only be able to sell it for $925. In a bank account you can get the money essentially immediately - and it is all there. If there's a chance you need the money before 6 months, pick a high yield savings account (likely a hair over or under 4%). You can also look at something like an ETF - WisdomTree Floating Rate Treasury Fund (USFR) which is slightly less than a HYSA (and has an expense ratio), but it is state and local tax free - so if you are in a high income tax state, it may make sense.

Financial-Seesaw-817

1. Maximize TSP contributionsFederal employees get one of the best retirement setups in the country.Why this matters:The last decade before retirement is where contributions compound the fastest.TSP C/S funds historically grow far faster than G/F funds.Reddit consensus strongly favors aggressive allocations until within ~5 years of retirement. Target:At least 15%–20% total contribution if cash flow allows.Keep C/S heavy (80/20 or similar) until ~60, then gradually shift to L funds. 2. Max the Roth IRAHe already started one with ~$900. He should make this a full $7,000/year contribution if possible.Why:Roth withdrawals at retirement are tax‑free, which pairs perfectly with taxable pension + SS.Gives flexibility for early withdrawals if needed (contributions are penalty‑free). 3. Eliminate the $26K loanThis is the biggest drag on his retirement math.If the interest rate is >6%:Paying it down aggressively is mathematically better than investing.Reduces monthly obligations → increases retirement survivability.If <4%:He can pay it slowly and prioritize TSP/Roth. 4. Build a 6‑month cash bufferHe only has $2K in HYSA, which is dangerously low for someone nearing retirement.Target:$20–25K by age 60.This prevents tapping TSP during market downturns (a major retirement killer).Reddit TSP users often keep $100K liquid for bear markets. With 5–10 years left, the biggest wins come from: Increasing TSP + Roth contributions Staying equity‑heavy Eliminating debt Building cash reserves Lowering expenses Delaying SS

srfdriver99

Full benefits for Social Security in retirement don't kick in until age 67 for you, and Social Security will be insolvent in 2032-2033 or so, and will automatically cut benefits by around 25% the minute that happens. In 5 years, you will be 62, so you will be getting partial benefits - which will get cut further - if you take Social Security then. 232K in the TSP will be maybe 350K in 5 years. 4% rule gives $14,000 a year. Let's be conservative and say that the TSP plus your pension gives you a combined $2000/mo. You didn't say how much is in your traditional and Roth IRAs, just the contribution amount. The HYSA is too small to bother discussing, and the same is true of the Roth. How much is in the traditional? You need to zero out all your debt and get to the point that 4% of your own retirement funds is enough to pay the bills, considering that people tend to pick up higher medical bills as they age.

SuperiorStagnation

you’re already on a better track than most people i see posting on here, you’ve got the TSP humming and the pension is a nice safety net even if it’s modest after insurance. the on-call pay not counting toward retirement is such a classic fed move, my uncle dealt with the same thing at a VA up in Ohio. i’d be a little worried about that $26k loan though, what’s the interest rate on it? if it’s high that might be eating you more than the extra mortgage payments are saving you, depending on your mortgage rate. the HYSA balance feels a touch thin for someone with monthly expenses in that range, i’d try to nudge that up to at least three months of bare-bones costs before piling more into the roth IRA. the Roth TSP contributions are smart since you’ll be tapping that in a window where taxes could be higher, just keep an eye on the fees in the TSP funds compared to what you could get in your IRA. you’re not in a dire spot at all, just a bit of tightening on the debt side and building that cushion could make the next five years feel less like a tightrope walk.

0201037464793921170

One of those days that makes you just want to have a HYSA. Nasty.

spilledonwhite

cause bonds lose you money unless they are 1-3 month (basically HYSA)

Ozqi

Why use a HYSA if you can just buy 10Y bonds?

EaZyMellow

Tax is tax. Sell some, put whatever % that your taxes on it would be into a HYSA, then the rest is yours to do whatever. Or close all positions & YOLO on 0DTE’s like a true champ.

UncleTio92

Someone who has a small business and uses the HYSA for a small business loan if need be. Be he honest, how quickly can you transfer money in and out? I will say PNC does have brick and mortar stores that I can go get a cashiers check if need be

rhino369

Sgov is a short term treasury etf. While it’s not risk free it’s essentially the same risk as your HYSA. Because the FDIC is funded by treasury bonds.

tech01x

A lot of this depends on your tax situation. HYSA is obviously straight up income, taxed at ordinary income progressive rates. You might want to lower your taxes by seeking investments that have tax equivalent yield, but lower taxation. Stuff like SGOV. Or you might take a small portion of that and expose it to principal loss (even if it is temporary) like municipal bonds of your state (completely tax free) or TLT. Of course, HYSA interest rates adjust relatively quickly to changes in interest rates, so if you believe these interest rates won’t stay here, and will drop, then things like CD ladders and treasury/municipal bonds might make sense. Especially if you don’t expect to have to pull from all of this all at once.

NuanceEnthusiast

HYSA. It needs to be liquid. If it’s an emergency fund, it needs to be there if today is the emergency

Crazytreas

Majority of SGOV is state and local tax exempt while HYSA's would be entirely taxed by the state and localities. The higher your state taxes are, the better SGOV will be.

Plus_Persimmon_2521

Your second sentence reads "This is Have 6 figures in HYSA @ 4%. Change? our rainy day account", looks like the title got pasted in there by acident. Also worth noting the image attached is a TabPFN ad, not anything to do with savings rates.

__redruM

It could be argued that stretching the truth about the state of the economy serves the purpose of getting liberal and centrist voters to the polls for the midterm elections. This includes the last two years. But past that point it’s too late for the rhetoric to be useful. And it’s not like a bunch of republican voter go to reddit for investing advice. It’s young liberals hoping to learn investing. Telling those people that 2007 is going to happen any moment now and they should sell everything and move their funds into a HYSA is very much friendly fire. It’s gross, but luckily there are other subreddits the political operatives have not yet found.

Brilliant-Rise3097

if the hold is only a month, a one‑month fixed‑rate or short‑term gilt‑edged security is basically the same as a HYSA but with a guaranteed rate; just bump the issuer’s credit score on the picker

agusus

That's not really true, the Fed funds rate indirectly affects banking consumers for sure. It sets the interbank lending rate range, so it sets a floor on the rate banks can earn off of the money consumers lend them. The OP is right to think that the greater the delta, the more their bank is short-changing them. It's worth picking a bank with the most competitive rate \*and\* most consistently prompt updates when the Fed funds rate changes (in both directions, not only prompt on the downwards). I'm not sure there's a list of which banks have the best track record on that. I deal with it by only giving my checking/HYSA account the minimum (just the current month's bills basically, sometimes 2 months worth) and keep the rest in Vanguard MM.

agusus

People with a lot of money in MM care. A 0.25% delta on $60k is about $150/yr. That may or may not be worth your time. But some people's HYSA's under deliver by 0.75% (3x that) or more. 60k or more in cash is reasonable for many people's \~6 month emergency funds, or retirees. And if you're holding a lot of cash you don't want to underperform the Fed rate by a lot because then you have a negative real yield - literally losing money.

RingoFreakingStarr

I have a HYSA with American Express and within the last month or so I've been notified that my % has gone up twice.

SnS2500

She could just put $6000 more in the Roth in SGOV, and then not pay taxes on the interest she would in the HYSA. No need to invest it now... small benefit of interest income in the Roth instead of the HYSA... she can take it out if she needs it... but in future years she may want to invest more in the Roth, so it would make sense to max it each yearly contribution now when you can, even if for time being you just have it in zero risk SGOV or something similar.

rvanasty

Are you planning to combine finances after marriage? She should keep 3-6 mo of bills in cash (HYSA) "emergency fund" and the rest should be invested.

EfficientExit4422

Fixed rate 5% HYSA

Straight-Annual8687

Auction going to be a nothing burger........the rates are not impacting the market, and are far too low to impact the market. Seriously, who's going to dump out of the market for \~5-6%? You can just about get that in a HYSA. Those that are in the market will remain in the market.

DONNIENARC0

If you actually think it's going to crash, then probably just hold cash, bonds, or throw it in a HYSA.

AcrobaticTurnip171

HYSA is solid for preservation, but the rates today are usually less than 0.5% p.a., so you barely beat a normal savings account. If you want a few extra pennies you could try a 1‑month Treasury bill—it's also risk‑free and the yield is a touch higher. Just make sure the account has no exit fees in a month.

mspe1960

You have never needed to send money via an EFT? How about you want some cash from an ATM*?* I am retired and the way I fund my entire life is by automatic monthly transfers from my HYSA to my checking account. As needed, a few times a year, I transfer accumulated dividends and/or capital gains to the HYSA to keep it funded for that purpose. And yes, some of those are SGOV. But I cannot use SGOV for cash flow. It does generate cashflow but I have to sell it and wait for funds to clear before I can use it,.

Medium-Pollution2643

Sympathize with the anxiety, everyone holding cash right now has run this exact math. But the signals you listed, overbuilt housing, the dollar, people cutting back on fun spending, are all things you can only really name after the fact, and 4% in a HYSA is taxed as ordinary income so your real return is thinner than it looks. If the money is truly untouched for 10 years I'd still put it in, maybe spread over 6-12 months if that helps you sleep, and if it's 5 years and you might actually need it, the savings account is a perfectly reasonable place to park it.

AlternativeKick5225

I totally hear your point about the short horizon – the extra few basis points from a 3‑6‑9 month T‑bill ladder are usually dwarfed by the hassle of setting it up and the risk of the office shutting down. For a 9‑12 month purchase I’d keep most of the $75k in a 4.5% HYSA and maybe keep the $15k SGOV as a quick‑access safety net, but otherwise skip the ladder.

mspe1960

They are saying they use SGOV as a replacement for a HYSA. I am saying, correctly so, that it is not a one for one replacement.

unpluggedcord

You got downvoted because nobody said it was as an HYSA

B_P_G

A HYSA account doesn’t have same day liquidity either.

NobodyOk1556

yeah, banks aren’t required to pass fed hikes straight through; they weigh depositor inflow against loan demand, funding costs and competition. feds bump the base rate, but your bank’s 3.4% is still around the market average for a while. i see most big online banks (Marcus, E\*Trade, SoFi, Capital One) raise their HYSA to 3.5‑3.75 around a week or two after a fed move. if you’re comfortable switching, moving a chunk to one of them will give you a few extra bps. or keep whatever you need in a brokerage money‑market or Treasury‑bill fund (SGOV, IIQA) if you don’t need instant ATM access. in short, the fed sets the tone, but each bank decides how fast to echo it.

Over-Computer-6464

HYSA and CD rates take a month or two to adjust to rate changes. That is why in 2020 I sold a lot of treasuries and bought CDs. The CDs remained at higher interest rates for a month or two after treasury rates dropped in March/April 2020.

mspe1960

SGOV is a good place to park cash, but it is not equivalent to a HYSA or MM fund. It is not as liquid. You cannot do an EFT from it, and you cannot write a check. If you don't need same day liquidity, it will not be an issue. But many people do.

__redruM

Index funds give next day liquidity, including SGOV which returns as much as a HYSA and lets you skip state taxes. But imagine you had your emergency fund in VOO for the last year. It’d be up 15% and could handle most normal dips without losing money, and after 5 you’d be approaching almost double your principal. This is a real risk, but would accelerate someone who started retirement savings late, and once you’re well into 6 figures, the market would have to really dip for you to sell at a loss. I still keep $20k on hand, but can’t leave much more out of the market.

Insulaner

I agree, I have my emergency fund in a HYSA for the immediate liquidity. I'd only use a money market fund/Treasury bills for cash I know I won't need right away.

redhill_qik

Both Marcus and ETrade have increased their HYSA interest rates 

sharp315

1. set aside emergency funds in a CD or HYSA 2. open a taxable brokerage account and invest what you can in VOO 3. later, once you have income, you can open an IRA account and sell down your taxable positions to contribute to the IRA. try to maximize your IRA contributions each year.

SarlaccJohansson

Well no, equities (say S&P500) outpace inflation in the long run. HYSAs do not. Inflationary risk dominates assets returning near the risk-free funds rate. HYSAs carry no price volatility or credit risk. You're right that they are good for liquidity and are certainly better than standard banks. I'm getting into "ackshually" territory lol but my opinion is we shouldn't describe HYSA as "zero risk," it costs nothing to be particular about the risks they do absorb.

Imaginary_Tie4218

I’m 23, nearing 24. Same boat background wise, Just decided to buy my first ever stocks (just some S&P 500 and similar). I’ve been working for years just keeping money in the bank making pretty much nothing (not even a HYSA). After working my first full time job this past summer and having more money than I’ve ever had before, I decided to invest and also open a HYSA. Feel like I’m taking baby steps. Also just got my first credit card so I can start building credit and make some cash back on purchases I would be making anyways. I used to use apps to scan receipts for gift cards and etc. feel like there is so much to this money game and I will never catch up or wrap my head around it all. Don’t even want to think about all the trading terms and tax terms that I’ll never understand. Baby steps

bam2350

SGOV or treasury direct or HYSA

SpookyKG

HYSA.