SGOV

Far_Lifeguard_5027

I have my semi-emergency fund in SGOV. It's a treasury ETF that is yielding about 4%. Treasury funds are the safest place to put your money, and the interest rate should beat inflation. Also treasuries are mostly exempt form state taxes. If you're worrying about your savings account loosing money to inflation, you basically have two options: a money market fund at a brokerage (like the SPAXX/FDLXX money market fund offered through Fidelity), or an online high yield savings account, which will not be tax exempt. I think the money market fund is a safer choice than a HYSA. A bank can lower their interest rates at any time, but treasuries are tied to the federal interest rate.

Rez_X_RS

Open a brokerage and deposit your money in SGOV or a high yield money market like SPAXX for Fidelity. A savings account is meant to house your money so it's 100% there when you need it, its low yield because it's baducally zero risk. If you want yield then you have to take on some risk.

Heyhayheigh

You’re not being robbed, you have a secure place to keep your cash and pay your bills. They used to incentivize you with savings yield, the market is such that it isn’t necessary. No savings keeps pace with inflation. Investments are needed for that. SGOV in a brokerage. A pretty small amount of it. The rest is truly invested.

rithsleeper

I just transfer any idle cash into brokerage. I have credit cards for “emergencies” and can always transfer cash back out of the brokerage to pay the credit card debt before it incurs any interest. It seems cumbersome for most people to do all this transferring but end of the year it looks like about $300-400 extra minimum in interest as opposed to keeping my bank account at say $10,000. Now in the actual brokerage I’m either holding in BIL or SGOV. It also allows me flexibility with margin. I sell a ton of premium so we have a Vix spike I sometimes need to sell a few “shares” of BIL or SGOV to make sure I’m not being charge an overnight rate on futures. I’m managing my money very actively, but it’s fun for me to see those totals end of the year and paying taxes is fun because I get to see I’m making essentially my salary off my investments each year. Just kind of wish we had another 2022 so I could see if I still make another salary of investments and test the non directional strategies I use. This rocket ship of gains has made all my work look like “just voo and chill man” is the right call. But all it takes is one year of even -10% and I’ll be way ahead of the game. Most people say that voo and chill makes them sleep at night, I’m the opposite. Betting on one direction in the market and that we could potentially have another 2008 or something where investments lose 30% in a year?! My diversification in not just companies, but strategic plays through selling premium, nondirectional bias, futures, commodities like oil, bonds, precious metals, corn, nat gas, even the occasional lean hogs future haha. Uncorrelated assets and strategies are what let me sleep at night.

VegasBjorne1

Open a brokerage account and buy the ETF SGOV which invest in ultra-short term T-Bills. SGOV can be sold at anytime, available in brokerage account next business day. Interest paid on the 6th of the month, and virtually impossible to lose money with current APR about 4%.

butlerdm

Aren’t people just using HYSAs, SGOV, or similar for yield on cash? You don’t beat inflation with cash savings, at least not for long

CHL9

Your uninvested cash should be parked in SGOV (ETF) or your bank's MMF (money market fund) for example at schwab its SWVXX, and you'll get about the current fed rate, about 4%, which is called the "risk free rate", ie the rate at which you can get interest without a serious risk of losing your investment. Banks #1 source of income is interest on their lending out or investing uninvested cash, it's what allows the US to have mostly solvent banks and for you to have no-fee banking, instead of how it is in many other countries where you must pay a monthly fee to hold your money at the bank and fees every time you do something . But yes in short that's what you will get on uninvested cash unless you use Fidelity where they keep your uninvested cash in a money market fund which yields a few points under the risk free rate, and they do the "automatic sweep" which means your money will accrue that interest and be bought and sold automatically. Most other banks you have to manually buy SGOV (or another very short term bond ETF) or the money market fund and sell it a day befor eyou need it

6JDanish

>*Where are you guys actually putting your cash to beat inflation right now?* In a brokerage account. I park cash in SGOV (an ETF), then use it as collateral to back various stock and option positions. For large cash amounts, brokers offer a decent rate. Interactive Brokers, for example, has a calculator here: [https://www.interactivebrokers.com/en/accounts/fees/pricing-interest-rates.php](https://www.interactivebrokers.com/en/accounts/fees/pricing-interest-rates.php)

sam99871

Put all of it into SGOV but hold back 5K and try to do it again.

LewinskySwallowed

Robinhood does not add a benefit, that's the problem. The gold membership cost $5 a month and is at a rate of 3.25%, not 3.75%. With this membership, you cannot earn interest on the cash used for selling puts. If one opened an account at RH with a Gold membership and think they will be collecting interest on cash while selling puts because of your comment, they would be sadly mistaken to find out they do not earn interest except on the cash not being used for puts. They will also need a daily balance average of $1846 that is not used for selling puts, in order to recover the gold membership cost of $60 per year. This might sound like little money to you but when you look at the numbers, that's like 50% of the average account size at RH. As for the OP's question, and to add to this response about people thinking they are "smarter" because they don't like Robinhood, I will respond why it's smarter to not use Robinhood. To sell puts at RH and gain interest, you need to buy into something like SGOV and you don't have to do that at Fidelity, you get automatic interest earned from $0.01-$Max at all times. Fidelity also let's you use 100% of your cash for puts, especially when we get into selling puts on margin. When you have SGOV to earn interest and selling puts, you only have 70% of your cash tied up in SGOV to use for selling puts. At Fidelity, you have 100% of your cash to be used for selling puts on margin while earning interest. You claimed $5 a month for a RH gold account is so cheap, it's no big deal so now it's time to pull up your pants into the big boy world. If my account balance is $10 million, I am earning interest on $10 million and have $10 million in option buying power to sell puts on margin. If I'm at Robinhood with $10 million in my margin account, I have to put $10 million into SGOV to earn interest selling puts but now SGOV is only allowing me $7 million in buying power to sell puts with. I am losing $3 million in buying power to sell puts on margin by using Robinhood. That's correct, $3 million dollars going to waste just to use Robinhood. That is not smart and the reason the OP asked if there is another broker who offers identical service. The answer is no.

derfahrer924

I plan to retire within a year, and this is how I am setting things up. 5 yrs worth in SGOV + a bond ladder. Intermediate term is a mix of corp and HY bond ladder (using iShares fixed duration ETF). The rest is in a mix of equity ETFs and a handful of individual stocks I don't want to be in a position of having to sell stocks during a downturn in order to withdraw living expenses. I've seen that happen to a number of people during both the dot-com crash and the GFC.

_galaga_

The keep your head down and continually contribute approach is great. Might help to list symbols in addition to or instead of fund names and also use % instead of currency. Obviously you’re starting with 1000 here so it’s easy for even my feeble brain to do the math but if you read around here a lot you’ll see examples like: VOO 50%, SMH 25%, SGOV 15%, IBIT 10% as that’s concise and easy to give feedback on. I agree with the comment poking at your dividend focus. There’s probably a better alternative for your largest fraction from a long term growth perspective. I like SMH, it’s been good for me, but there’s risk since it’s so tightly tied to AI/AI CapEx. My last comment is a little contradictory, I like that there’s some risk/reward with your smaller chunks but I also think your main chunk could be larger for stability purposes. Not necessarily Three Fund Portfolio proportions but higher than 35%.

AmazingDays-

If your collateral is in cash, yes, you stop earning interest on it. But if you have it invested, you can use it as collateral and still earn the interest over the investment. You have a knock down on the maximum collateral you can have from that investment though, but if not too risky, it is not too much (25%). In my RH I have a lot of money siting in VOO and SGOV, zero cash, and do all my option trading on the collateral the SGOV and VOO provides. Math simple, if you have 100k in SGOV and VOO together, you can trade options using up to 75k of that investment as collateral.

DickFitzwel

Like others said, throw $115k in a HYSA or maybe SGOV in the retirement account and then try to do it again with $5k. That way you can answer the question of it being a fluke or not and you arent risking it all. Worst case you lose the $5k and have your answer.

Heyhayheigh

Perfect. Open a self directed Fidelity account also. And put your cash in SGOV. You shouldn’t need HYSA or CD’s. I’m surprised your advisor didn’t tell you this. Fidelity is great. Not sure why you would use some unknown when you already have a proper broker.

Heyhayheigh

Why do you have managed money and not have a plan for cash? Just use SGOV in a free broker like Fidelity. If you don’t have these conversations with your advisor, you’re likely overpaying…

Mightylibra

Just realized this is actually a good way to use a margin loan. I worked out the process first, then found this subreddit lol. Don’t usually trade like this, but I’ve already parked the cash in SGOV. Just waiting for a good first trade.

Heyhayheigh

So ally is great. I used to use them a long time ago. Money markets were weird to use. ETF’s used to be T+3 (yes I’m old), and there were trade commissions. Now with SGOV being T+1, tbill etf so no state tax on interest (you pay that in hysa depending on your state). It’s just a good habit. Ironic you use Ally, that’s who I used to use. Lol. Other banks will offer promotions for rates. So you hop from one to another. All the banks are rolling tbills, so SGOV will always just beat them long term when you factor in the bait and switches and time transferring from one bank to another. SGOV is just a better habit. And it gives you a historical performance compared to benchmark, so you know what having so much cash has actually cost you (banks don’t do this, they just let you get eaten up by inflation, oblivious). It’s fine to use HYSA it’s not that big of deal. You doing great. Fidelity taxable is easier. Fractional everything. Stocks and ETFs. Best of luck!!

TonyzTone

I meant reasoning as to why SGOV is better than HYSA. As far as ease, one isn't any easier than the other for me. I can (and do) drop money into my Ally HYSA every week. I do the same for my Fidelity IRA and Roth, where I could set up auto-buys for anything. Or, I can use my taxable Scwhab acct to do the same. So, I was really asking why it's better. I'm currently using my HYSA as a place to park for emergency funds, and small buckets of savings (vacations, etc.). I wouldn't be opposed to shifting that cash into something with better returns, but didn't consider SGOV to be better until your comment.

Heyhayheigh

Reasoning? About what part? SGOV, it’s better than HYSA. Especially if a state that taxes 1099INT Investing auto and weekly? It’s just easier. Use a place like Fidelity, that does fractionals. If your budget is 1k a month, set to $250/week. Then work to increase that weekly. That’s all investing is. Spend less than you earn, invest auto, don’t panic sell. Panic sell = selling without having an urgent expense to pay for. As long as you only sell to pay for an urgent bill. You good. After a while of doing this you realize money is super easy. Best of luck!!

Heyhayheigh

You are doing fantastic! Use SGOV in brokerage instead of hysa if you are in a taxed state. But other than that, keep it going!! Set your purchase to auto weekly if you can in taxable and don’t panic sell!!

CornerOne238

5-7 years? SGOV or JAAA if you are feeling spicy.

Heyhayheigh

The books I read said it over and over. My heroes Buffet and Munger said it. It really hit home as an advisor and seeing countless droves of people panic selling and not automating. You really have to know nothing. Buy VOO auto weekly. Work to increase that weekly. Only sell when you have an urgent expense to pay for. You could know nothing else and be fine with just that. You don’t even really need a cash equivalent strategy (money market or SGOV) if you were truly optimized to VOO and chill. The difference would be so small until retirement age it wouldn’t matter.

usa_reddit

Nothing wrong with VOO/VI it's slow, safe, growth over time. This is my strategy and I believe it will beat VOO/VTI over the next year, but I have higher risk exposure in SMH and SGOL. |SMH (Semiconductors)|15%| |:-|:-| |SCHD|20%| |GLD/SGOL|15%| |VYMI|10%| |SGOV|10%| |SCHG|30%|

kiseki1107

VOO and VTI overlap with VTI holding 3000+ US companies and VOO holding only 500+ companies. If you want foreign exposure outside US, then VXUS is a good one. A dividend-focused one would be like SCHD. VGIT, BND, SGOV are all like investing in fixed income/bonds/HYSA so I would put a few percentage there for a safety net. Overall, if your goals are aggressive, I’d put like 50% in either just VOO or VTI. Split the remaining 50% among foreign exposure like VXUS, dividend exposure like SCHD, and fixed-income exposure like VGIT.

EeveeOnIfunny

All in on SGOV. Upvote this for the GUARANTEED profit 😎

pbmadman1994

You have the right idea and simple ETF investing will get you better results than 95%+ of people. Good tax efficiency too. I would avoid overlap though as others have said. Also consider some high yield cash equivalents while stocks are so high. For now I’d go with a stock market portfolio of 40% VTI 20% VT (global) and 40%SGOV until S&P PE for next years earnings is under 20. Then just 75% VTI and 25% VT when market corrects. When you reach 40yo, put 10% of your total portfolio in BND for bonds and increase 1% of your bond portion every birthday. Keep the stock portion with the same weighting. I got this strategy from Brinkeradvisor.com and have been following him with great success and returns for over 30 years.

Heyhayheigh

Get used to investing simple VOO and chill in a taxable. Auto weekly, don’t rely on self discipline. You could use SGOV to save up house fund, but honestly you don’t know what interest rates will be like in 6 years. The most important thing anyone can do is get into the habit and muscle memory if weekly VOO. Look at your weekly as a “competitor” to your bills. 2k savings a month is $500/week. You could do half of that, 250/week VOO. The other 250 in SGOV. The more you invest auto for longer, the more used to you will be with market volatility and see it is a feature for the automated investor. When you have something urgent to pay for (like a house), you can choose to sell for that reason. You will learn more things, like Roth. You might change to Nasdaq vs VOO. When you change, just switch the auto. Don’t sell. Only sell to pay for urgent things. That’s it. That’s all anyone needs to know. You will eventually learn more, but it all grows from that foundation.

Heyhayheigh

Why do you have 100k cash? Put in SGOV. All that matters is monthly income vs monthly expenses vs monthly auto investment. Buy whatever you can afford of VOO on an auto weekly basis. Then work to increase that weekly. Sell only when you have an urgent expense to pay for. That’s it. That’s all you need to know. Most people. Panic selling or get off the plan. At your current level you shouldn’t have any problems reaching your goal if you make serious effort and automate. Best of luck!

LordSnarfington

Yes this is exactly my confusion. It was explained to me but I just didn't trust the explanation because it feels like I am using margin as you said. I no longer buy SGOV with premiums received so I can BTC with cash unless it's a loss I'll have to sell some to cover. Thank you for your explanation

LordSnarfington

Robinhood and they treat SGOV as 75% of cash which is why I had to increase my margin a little after buying since I wanted my 35k to play with. It just sounds like using margin as collateral wouldn't actually be "using" the margin and therefore no interest. I understand I think it just seems like they would charge me for that

LordSnarfington

Right but I spent all my actual cash in buying shares of SGOV so it feels like I don't have any to use as collateral and therefore am using my available margin as collateral. If I lower my borrowing limit I have no buying power. So I guess I don't understand how I'm putting margin funds up as collateral but not getting charged interest.

RatherBeRoadtripn

So if I can open a Fidelity account for free and there's no fees at all in regard to buying SGOV, how does Fidelity make any money? What am I missing?

Lucky_Platypus341

Buy whenever, the daily interest/dividend is baked into the price. Open a brokerage account at Vanguard or Fidelity (or Schwab). You can buy SGOV (or any other eft, stock or bond) with no fees. (Mutual Funds from one may have fees to hold in another, but efts do not). Vanguard's sweep fund (where money not invested in anything) is the highest of the three by a fraction of a percent. Fidelity has the better interface and real banking/billpay. Schwab...well I'm still mad that Schwab only offers 0.1% on their sweep. Pick whichever you like better.

RatherBeRoadtripn

Hi I'm new to SGOV, and if I understand it correctly then from what you've said above, I want to just buy an outright SGOV, I do not want to buy an ETF SGOV correct? I didn't know government bonds were ETFs... I'll keep learning!! I have bonds incl Muni ETF out of brokerage. I don't understand them at all because I inherited them and per FA who says to do nothing, But let them sit there for now doing their thing, while at the same time urging me to invest in stocks. I do understand about the interest rate increasing has an adverse effect on bonds, and that the decreasing interest rates generally speaking, increases the bond price, Because the lower interest rate on new bonds makes older bonds with higher fixed rates more attractive than newer issued bonds if I understand all of that? Because the newer bonds have the new lower interest rates which is why the older bonds are in more demand and increase their market price. I think I just repeated myself! Of course the value of my bonds seems to be decreasing so...

RatherBeRoadtripn

Wow I'm just learning about SGOV and that was a really great explanation of earnings, thank you. I think I'm starting to get it. But just to clarify, The best time to buy the SGOV would be on the first day of the month? Or in actuality, it doesn't really matter when you buy, because by the end of that first month it evens itself out? Do I understand that? Also everybody is mentioning brokerage, can I buy SGOV on my own? Does it have to go through a broker? It seems straightforward enough that I would prefer to cut out any fees involved with a broker doing this.

kuvetof

The companies you listed are tech and they're all overvalued. Consider a value company ETF like VTV, treasuries (SGOV), or something with less volatility

zeugma_

Where is your 4.25% SGOV? SEC yield is 3.67%.

Equivalent_Cow3446

Put it into SGOV. No state taxes. Zero. Risk. A bit better rate than Hysa.

DJ_Mimosa

Also, trailing PE is highest ever, and forward PE is at a ceiling that it almost never surpasses. Don’t like PE and more of a FCF person? Also bad news, those yields are atrocious. I’m not calling for a crash, but can’t see forward returns being spectacular right now, not when SGOV is paying a safe 4.25%.

Unlucky_Employee6082

Dumb question, about what percentage do you hold back in savings for the dips? I always see people excited about stuff like Liberation Day, but isn’t there a fairly steep opportunity cost to keeping money in SGOV or whatever for months or years waiting for stocks to go on sale?

chindef

You’re doing everything you need to do.  You can move your HYSA into a taxable brokerage account and buy a money market like SGOV. Slightly higher returns by 0.5% to 1% and depending on which state you live, likely does not have state income tax on it. Overall minor, but worth doing since you’ll probably always have an emergency fund just sitting there. Might as well increase returns.  Also, does your employer offer an HSA? If so, be sure to max that out and invest however much of it you can. Mine has quickly grown to $15k, plus I’ve gotten some medical things done that I otherwise wouldn’t have - which is a much better way to live. That $$ is designated for medical, so there’s no reason not to take advantage of it.  When you say IRA, are you contributing to a traditional IRA then backdooring it to Roth? If not, you should be doing this 

jaajaajaa6

Market timing is a tough game. That said, park your money in a short term bound fund like SGOV, etc. and if you live in a state with income tax, you avoid it with these funds over a money market. Anything else is speculation and you may be wrong. People were shocked during the GFC when their corporates tanked.

braundiggity

Do you need to hold SGOV through the end of the month to receive the dividend? I had to cash mine out on November 28 and didn't receive a dividend for that month; I'd been under the impression the dividend accrued regardless of when you buy and sell, but now I'm feeling like I'm an idiot, and looking for confirmation of such?

Lauve

I feel the same, especially with current valuations being very close to the dot-com ratios. Currently sitting on 15% cash / SGOV, gradually increasing it towards 25%-30%.

Cav829

The longer you invest, the more you'll learn to tune out the noise. I had to fight the feeling of hating to lose money for so long, to learn to tune out the jitters, to stop worrying every time a stock sells down to support because of some random news item, etc. Every last investor will tell you they made a crazy amount of mistakes, and to this day still do. I was too young to invest in 2002 though I remember it vividly, but 2008 resulted in my best investment opportunity of my life because I kept powder dry. And it wasn't in stock: it was in real estate. This doesn't even mean you have to sit in cash: USFR/SGOV are great places to just stash cash. Ignore anyone who tells you that you have to be 100% equities 24/7.

rpm12390

If you want to keep it simple, leave 50% in SGOV and put 50% in VOO, then rebalance once per year. This is a legitimate long term investing strategy with great risk-adjusted returns. It's called the couch potato portfolio. Look it up.

drew_eckhardt2

When you have state income taxes buy treasuries or a treasury fund like SGOV through your brokerage account. Although rates are similar to CDs, no state income tax makes the after tax yield higher. A 3 year treasury yielding 3.5% is like 3.85% fully taxable for a middle class California resident with a 9.3% income tax rate. Treasuries are also more liquid than CDs whether at a bank or brokered.

yellowLantern

Hear a lot of recommendations for HYSA or CDs, but do you live in a state with state tax? If so a treasury etf like SGOV or buying treasuries themselves will give you a good interest rate while avoiding state taxes.

Actual_Stranger_1766

use part of it to fund a 6 month emergency fund in a high yield savings account, then after you do that if you absolutely plan on using all of the funds to purchase a house in 3 years you should open a brokerage account and park it into SGOV.

Think_please

Just put it in a high yield savings account, SGOV, or money market, three years is too short for stocks.  The more important thing is to figure out what kind of house you want to buy and where it will be. I’d put the purchase off a bit to learn about your area but I wouldn’t wait a full three years while prices (most likely) go up with inflation. At your age and while you are single I can’t recommend buying a place with 3-4 bedrooms (or, most ideally, a duplex or triplex if you are not in a super high cost living area) enough. Live there and rent out the other units/rooms (screen well for finances and temperament) and let other people pay your mortgage for you while you (mostly) lock in your housing costs for life. You’re in a unique situation with that kind of inheritance at this point in your life so whether you invest it in your retirement accounts or buy a living/investment house you have a rare chance to make your later years far easier. You can put as little as 3.5% down with FHA, but you should be able to do 10-20% with that inheritance (save some to do some work on it when you live and for emergencies), so start thinking earnestly about where and how you want to live asap.

crazybutthole

This is a pretty big deal to me. The financial advisor is going to get a pretty decent cut to tell you to do something really fucking simple Make a fidelity account Put in the money. Put it in SPAXX or SGOV Wait three years. Don't touch it. Three years later - take out money and buy a house. Done. No financial advisor fees required. Its all right there

Heyhayheigh

Open a Fidelity account. Put the money in SGOV. Then educate yourself on personal finance.

rufio313

Depends, there’s no right or wrong here. TTTXX has the advantage of same day liquidity, lower expense ratio, and shares can be purchased in $1 increments making it easier to dump a specific amount of cash there. SGOV requires you to buy full shares, which right now means you are buying in $100ish increments. SGOV is also a bit more complicated to deal with come tax season.

halfmoonjb

US treasuries held in $SGOV (~99% of it) are exempt from state income tax

Calm-Juggernaut6099

To each their own, but VOO, SCHD, SGOV, and also VXUS if you feel like dabbling international. That’s the play.

WideAd2062

You’re actually in a strong spot. You didn’t mess up — SGOV gave you safety and flexibility, and most people never get that far. Your updated plan is solid. Putting some in now gets you exposure, and DCA’ing the rest takes timing pressure off. Missing recent gains feels bad, but over 10–20 years it won’t matter nearly as much as being consistently invested. The real risk isn’t buying after a run — it’s staying under-allocated because of regret. Stick to the plan, automate it, and let time do the work.

halfmoonjb

Where it is now in $SGOV is still better than a CD. Better tax advantages, yield, and liquidity.

real_patrick_

Yeah, I have around $20k in Roth and $110k in Traditional, but sadly also all in SGOV.

mamapop

Figure out what your emergency fund should be, put that in SGOV. DCA the rest into VOO over whatever timeline/risk profile feels right for you

_galaga_

Not your point but SWVXX is exposed to state income tax, btw, while SNSXX/SGOV generally aren’t. Might not apply to your situation but thought I’d mention it in case it did.

greytoc

Open orders do not accrue interest. Only positions when filled will accrue interest if you have a margin balance. Afaik - all brokers accrue margin interest daily from settlement date to settlement date. So if you sell SGOV on the same day as you buy something - margin interest does not accrue.

bakedbeans-gas

Thank you for this input.  I am on Fidelity and Vanguard, so hopefully it's not all that different.   It's just a hassle to constantly monitor ETF prices to time when I want to buy /sell, which is why I'm considering using margin for operational purposes.  So much easier keeping open orders, getting a message that orders were filled, and selling SGOV to "fund."

Heyhayheigh

I have a bunch that have been accumulated over the years. Either through tax loss harvesting efforts or experimentation. I just stick to QQQM for my weekly auto buy now. SGOV fo the small emergency cash I keep on hand. Keep life simple.

Cool_Flamingo6779

Max unemployment payment in my state is 370 a week, not even close to enough to pay my family's bills.  I keep a few months expenses in SGOV just for that reason.

OkJellyfish2671

But I didn’t know you could keep it in things like SGOV and earn interest on it

Skaggzz

I would not split them evenly as then you are actively making bets overweighting sections of markets you probably don't even intend to. To keep it simple passive investing is a solved problem you buy the market with the lowest cost funds available. The two big decisions you need to make are your stock and bond mix and then your international allocation. VTI is essentially 3800 US companies its 99.8% of the US VXUS is the rest of the worlds stock markets (though not nearly as complete as VTI) All the stocks that makeup SCHG are in VTI by buying SCHG you are overweighting Large cap growth - will large cap growth overperform relative to the other companies from now until you retire? I have no earthly idea so I would keep it simple and stick to VTI and not complicate your portfolio with overlap. 60% VTI, 20% VXUS, 2.5% FLCH, 10% SGOV and 7.5% reserved for your individual industry ETF and company picks will set you up for a very successful future. Once your investments are of sufficient size you can decide to learn about investing and spend time researching individual companies and pouring over 10k's and trying to beat the market. Until then its a waste of time and a losing effort - just buy the market and let it compound.

OkJellyfish2671

I do like the SGOV idea a Ilot, this is great. So if market turns and I see buying opportunity I can sell SGOV and roll it into that stock of interest? I do see your point with individual stocks, I do enjoy it but well informed I cannot say I am, I will look to minimize my stock picking to a select few and really hammer the etfs. I know you listed two in your first comment I should look to add. Would you split them evenly across the board? Assuming I’m looking at vti, SCHG, FLCH, VXUS, SGOV, and CIBR as my etf conglomeration

OkJellyfish2671

SGOV is like a high yield savings but for a ROTH?

annac156

what do you mean - how do you get 70% Buying Power from buying SGOV?

OkJellyfish2671

Curious as to what SGOV actually is

Skaggzz

I would add VXUS and FLCH at a ratio of 9:1 for overseas exposure with a more properly representative chunk of china. And I'd remove Tesla, Palantir, microstrategy, and definitely QQI and roll it into VTI. You are buying such minute fractional shares that it is probably hurting you in the bid ask spread long term. Put your cash into SGOV and get some treasury yield to boot.

teckel

If say the cash amount should be 3-6 months living expenses, until you're at a position in life where that's no longer needed (wealthy or retired for example). Everything else should be invested at all time. Now some investments may be much lower risk (like saving for a home, vacation, HSA or whatever). But it should still be invested somewhat (maybe just SGOV even).

Nizhoni1977

I keep my emergency fund in SGOV and all other cash is in investments. But I make way less than you so I don't keep that much for emergency fund. It's at about 17k.

greytoc

Are you saying that you have a 10 year horizon before buying a house? I wouldn't use SGOV or VBIL. Those are short duration funds. If you want to just have the risk free rate - you may want to look at a longer duration treasury fund. It also depends on whether you believe if interest rates will go down or not. Alternatively - with a 10 year horizon - you probably could put some portion into higher credit risk products if you want the relative lower risk of bond investments vs equity investments. You could look at corporate debt. Something like target-maturity corporate bond funds from SSgA, Invesco or Blackrock may generate higher yield - depends also on the state that you live treasuries are state tax exempt.

raiyan586

I’m a 26M and I want to start saving for a down payment for a house. I max out my 401k, HSA, and Roth IRA each year and historically have put the rest of my savings in a taxable brokerage account investing ETFS. I already have an emergency fund sitting in SGOV and VBIL. I’m my time horizon is 10 years, should I just put my cash for a down payment fully into SGOV:VBIL or split it between the treasury bill etfs and a total market index fund such as VTI? Thank you!

Revolutionary-Fan235

That's the plan. I officially retired in October so I haven't had to sell SGOV yet.

Thomas_peck

$50K sitting in SGOV. I take the divvy and reinvest in VOO or gold every month. I've been funding my IRA with it the last few years the first trading day of the year.

Revolutionary-Fan235

While working, I had a few months worth of bills in cash. In retirement, I have an additional one year's worth in SGOV. As a percent of liquid assets, it was 0.5% to 4%.

er824

SGOV and USFR and money market fund are essentially equivalent so I didn’t have a need or reason for both. I have a Traditional IRA at Schwab so that’s where my SWAGX is. My Roth is all SWTSX and SWISX.

Heyhayheigh

Set your 401k to sp500, lowest internal cost option. And max that out. Get as much in the ere as early as possible. Open a Fidelity account and setup an auto weekly amount of either QQQM or VOO, doesn’t matter. And then work to increase whatever your weekly is over time. The hard part is: only sell when you have something urgent to pay for. And don’t use HYSA, use SGOV in your Fidelity account. Best of luck!!

CornerOne238

True, there are a few. I like NKX at 7% yield but its price is not as stable as SGOV, of course.

crazybutthole

>What would you say is the benefit of a covered call ETF then? The benefit is great if you are 65 and retired and need income every month. If you have spent 35 years building up a great portfolio of $1million (or whatever number applies to your situation) and you can coast and enjoy retirement and not check the stock market every day. Its a fine choice. But if you are 35 and investing $2000 a month - you need growth. (Not some silly income ETf designed for old people) Too many people see something good and think it's good for them - but sometimes what's good for others, might not be good for me. A very big part of investing is about realizing where you are in your journey, and does this process or this product or even this allocation fit your need ? I'm older than you but still 10-15 years from retirement (maybe more or less if my stock picks go well or poorly) (Im a baseball guy - love baseball so i modeled my portfolio around baseball how their organizations are setup if you see that below) I have several different "teams" - all with different purposes. 1 taxable brokerage - it holds my emergency fund (SPAXX and BOXX and SGOV) this helps with expenses and if I need to upgrade my home field I am ready. and it hold ETFs.(Not exactly part of my emergency fund but in that account - I only buy and hold ETFs. Mostly VOO + VTI + some international funds - but i Never sell.) That's growing money that i could access if I need it. But I don't plan to use it until later.... when I really, really need it.(Hopefully retirement when my income is a lot lower so tax burden will be less) 2 Roth IRA - its all individual stocks growth focused (i buy and swing trade in this account holding anywhere from 3 days to a year if the stock does well) + I call this the major league roster. Its my big holdings. I have 9 starters (biggest positions) all of those have stop losses set to lock in profits cause they already proved to be big winners. I also have a bunch of reserves(the bench) who are growing into positions to become a starter if one of those main 9 ever drops more than my rules allow. 3 Traditional IRA - a mix of some ETF & some individual stocks. ( I jokingly call it my minor leagues) - any stock on my watch list - i sell a share of an ETF and buy some shares of some watch list stocks. But in this account I keep a few shares of anything I think might eventually become a major league starter someday. 4 Rollover IRA from an old employer (its all ETFs - but its 25 different ETFs mostly momentum and sector ETFs i rebalance every week takes 10-15 minutes and it beat sp500 by 10% last year) - I keep track of all this shit in an excel document that automatically downloads the prices and price history as soon as I open the file. I am sure it sounds super complicated but I have major ADHD and I love it. Keeps me busy when my wife goes to bed early I can study all this shit for an hour or two and keep my mind going

Chemical-Fun3692

This is super duper helpful!!! SWAGX is one that I hadn’t looked up, I think you mentioned this one before, but since they are bonds it makes sense to have them! So you have 2 ETFs (national and international) and a bond in IRA. Then a national and international ETF in the brokerage as well as 1 money market fund and the short term floating treasury. Curious why you didn’t also get SGOV? I thought about the target date fund, but I hears it was not as customizable so thought i’d try to go the manual route?

er824

SGOV and USFR are ETFs that invest in Treasuries. You can find a list of Schwab’s money market funds here: https://www.schwab.com/money-market-funds These various cash options are all essentially equivalent.

er824

Regarding International…. It diversifies you away from just the US. The US market has outperformed the global market for a while but no idea if that will continue. Plenty of smart people say US only is fine because the biggest US companies are international businesses. Other people say that ignores large swaths of the global economy. I have no idea what the future holds. Personally I the I’m about 30% of my stocks allocated to International. Last year was the first time in a long time International outperformed the US. SWISX is fine in either in a taxable or tax sheltered account. It will tend to pay a bit more dividend then SWTSX but still pretty tax efficient. If you are holding in taxable accounts I’d favor the ETF versions. SCHB is the ETF equivalent to SWTSX, SCHF is the ETF equivalent to SWISX. SWVXX is fine, TBILL ETFs like SGOV or FRN ETFs like USFR, or TBills are all fine places for cash. Personally I found directly buying TBills to be inconvenient so stopped and just use the ETFs and Money Markets now.

Chemical-Fun3692

where did you see the portfolio? How do I find a treasury fund or know what to search for? I believe the SGOV and USFR are treasury bills?? Any you recommend? And would this be in the taxable account to use as liquid money?

er824

It’s SWTSX, assuming you mean Schwab’s Total Market fund. If you want International exposure their International fund is SWISX. You don’t need a separate account at Fidelity unless you want it for some other purpose. Their sweep options are better than what you get at Schwab for uninvested cash but that’s only an issue if you leave the cash sitting in your Schwab account. Investing, like you would be doing by buying SWVXX, SGOV or USFR, solves that problem. The downside to Schwab is having to do it manually whereas Fidelity automates (sweeps) the cash to and from their SPAXX money market for you. The manual options actually yield a bit more so are better as long as you are ok with the manual step. Personally, I don’t see a reason to overweight dividend stocks, all the stocks in SCHD are already in SWTSX and SCHB. If you do decide to hold SCHD consider holding it in your IRA to minimize the tax drag.

Chemical-Fun3692

I am completely new to investing and I’ve been trying to read as much as possible and ask questions. Please let me know your thoughts on this game plan and if there is anything you would change, take out or add? This is just me going based off notes. I am 100% open to suggestions. Step 1: Contribute 4% employer match to 401k on Fidelity. Step 2: Backdoor Roth IRA - contribute $7,500 and invest in SWTSK (any other mutual fund or ETF I should invest in IRA?) Step 3: Invest in SCHB or SCHX in Taxable account Step 4: Invest in SGOV, USFR, and SWVXX in Taxable account - All for liquid funds Step 5: (Consider investing in SCHD in taxable account?) - Dividend focused ETF. Step 6: (Consider a Sweep account at Fidelity which offers a higher % return in a MMA, not sure why?) Step 7: Is SWPPX and/or SWTSX necessary, and if so, which account and why? Step 8: What about international ETFs and/or Bonds, should I add any to my taxable account and if so which ones? Step 9: Consider QQQ in a taxable account (but would this be redundant if I already will have SCHX or SCHB?)

Chemical-Fun3692

Also, is the QQQ necessary if I choose to invest in SCHX or SCHB which are both broader? I am not sure. Here is my game plan: Please let me know your thoughts and if there is anything you would change, take out or add? This is just me going based off notes from here. I am 100% to suggestions. Step 1: Contribute 4% employer match to 401k on Fidelity. Step 2: Backdoor Roth IRA - contribute $7,500 and invest in SWTSK (any other mutual fund or ETF I should invest in IRA?) Step 3: Invest in SCHB or SCHX in Taxable account Step 4: Invest in SGOV, USFR, and SWVXX in Taxable account - All for liquid funds Step 5: (Consider investing in SCHD in taxable account?) - Dividend focused ETF. Step 6: (Consider a Sweep account at Fidelity which offers a higher % return in a MMA, not sure why?) Step 7: Is SWPPX and/or SWTSX necessary, and if so, which account and why? Step 8: What about international ETFs and/or Bonds, should I add any to my taxable account and if so which ones?

Chemical-Fun3692

Ok gotcha! To clarify, you want a short duration basically?! Ok this is my plan so far. Please let me know your thoughts and if there is anything you would change, take out or add? This is just me going based off notes from here. I am 100% to suggestions. Step 1: Contribute 4% employer match to 401k on Fidelity. Step 2: Backdoor Roth IRA - contribute $7,500 and invest in SWTSK (any other mutual fund or ETF I should invest in IRA?) Step 3: Invest in SCHB or SCHX in Taxable account Step 4: Invest in SGOV, USFR, and SWVXX in Taxable account - All for liquid funds Step 5: (Consider investing in SCHD in taxable account?) - Dividend focused ETF. Step 6: (Consider a Sweep account at Fidelity which offers a higher % return in a MMA, not sure why?)

sunnbeta

>I’m playing with around 2 grand and I invest 10 percent of every check into the account which is a HYSA HYSA is usually referring to a high yield savings account, which stocks are not… (though something like SGOV can function that way)  I’d stick to just VTI/VXUS unless you’re looking for specific exposure not covered there (like precious metals) 

CornerOne238

Park it in SGOV while you decide. No state tax in CA on its dividends.

Heyhayheigh

Open a Fidelity account. Put it in SGOV. Then find a trustworthy pro. It’s really hard to learn with 100k. You’re misunderstanding the quote. Find someone to explain it to you.

ydoyouask

I have some SGOV, some BIL, a few bond funds. I probably leave more in cash than I should, but I have other accounts (401k, etc) that are fully invested, so I like some true liquidity to pursue opportunities as they occur. I probably am not optimizing my returns, but I'm ok with my performance overall.

Murky-Gate7795

Thanks for your input, it's great to hear that TT has been good to you and makes me lean toward going ahead and moving some funds there. Your point about no perfect broker is timely. I've been reading a lot of opinions about them on Reddit and there doesn't seem to be a consensus anywhere. They all have different strengths and each has at least one drawback. What do you use as a core cash position at TT? I've heard about SGOV or similar funds.

Chemical-Fun3692

Ah thank you! When we say effective duration of 0.1 or 0.2 years what does that mean exactly, what is an effective duration? Thank you for linking me to this boggle heads write up, that is super useful! I started reading though it and it sound like a floating rate treasury is super useful and he recommends getting one for sure, I’m still learning about this. Yea the reason I ask about short term ETF’s is to see if there are others comparable with varying returns. Like for instance there are diffeent 7 days MMF with varying returns and I wasn’t sure if it would be the case with short term ETFs like SGOV. Basically I wanted to know which list SGOV came from. But if they are all similar, I can certainly get SGOV and one of the floating treasuries like USFR and even include SWVXX as the MMF. I need to write all this down! It’s starting to sound like alphabet soup. If you don’t mind me messaging you to keep in touch that be great!

jarchack

I'm moving from Webull to fidelity myself https://www.fidelity.com/spend-save/fidelity-cash-management-account/overview. A lot of my cash is in SGOV, which pays 4.1% but is not quite as liquid as Fidelity's SPAXX

zxc123zxc123

>[OP thinks SGOV is paying 5%](https://media1.tenor.com/m/rpv72Z5PGCYAAAAC/joks.gif) >in 2026 Yeah. I've been moving out the yield curve to SHY/IEF and even those only pay around 3.5-3.9%. But hey... whatever they want to believe.

rage675

>5 years: VOO <5 years: SGOV