SPAXX

BillNyeForPrez

Okay, well, as others have commented: it might feel good but it doesn’t really make sense. Take the money you’d like to put into your mortgage and put it into SPAXX or VOO. Literally everyone is telling you not to do this.

Expensive-Direction8

Investing advice for graduate student Hello all, I will be entering a graduate program this fall. By the time I start classes, I will have about $8k in my savings account. I currently have a Fidelity money market brokerage account, with SPAXX as core position. My question is, how should I best invest my money over the next two years with what I have now? I am seeking to have decent yields so as to have a cushion for when I graduate. I am applying to jobs and internships, but have nothing locked down in the moment. Essentially, what would be your advice for safely and effectively investing my $8k while in school? Thank you

bobdevnul

The expense ratio definitely plays in MMF yield. Vanguard VUSXX ER 0.09%, 7 day yield 5.28% Schwab SNOXX ER 0.34%, 7 day yield 4.99% Fidelity SPAXX ER 0.42%, 7 day yield 4.97% Higher ER means less yield to you. The quoted yield is after the ER is deducted. You don't subtract it out again to compare yields. There is no correlation to bank HYSA. Banks have their expenses too, but the amount is not disclosed or known. All you need to compare is the stated yields. Bank and MMF yields are driven by different factors. MMFs may not always be better than HYSA. They were not when the Fed rate was at 0%. At that time banks were paying \~0.5% and MMFs were \~0.05%.

rygarski

go to [www.fidelity.com](http://www.fidelity.com) open a brokerage account transfer 95000 into said account purchase SPAXX with all of it or if you are in a high state tax state, get FDLXX Sit and accrue around 5% once you feel established you can start investing in other funds like FXAIX

Cruian

>What is the historical return of this super diverse bucket of non us funds? Vxus makes about 2% year over year from inception in 2012. That might be looking at only price returns, which didn't include dividend distributions. I'm seeing over 4%. VXUS is relatively young, having only really existed during a period of ex-US under performance. Basically the decade before it came out, we saw the US have even worse returns, but then go on to have the best run we've ever seen. >I can do better in SPAXX money market (risk free rate) than VXUS has done the past 12 years. You're applying a heavy recency bias. Things don't continue on like that forever. Your thinking would have led you to ignore the US and go heavy on emerging in 2009 (you'd be looking at a NEGATIVE 10 year return).

crazybutthole

If we can go back to 1950 I would give different advice. But it's 2024......it's not 1950. I would never recommend someone to have big exposure to a pure international fund. If they have a reason to buy a certain fund like Argentina or Spain? Sure throw 1-2% at it. But to just go throwing 10% or more of their money into a super diverse bucket of all non us funds? It seems crazy to me right now. What is the historical return of this super diverse bucket of non us funds? Vxus makes about 2% year over year from inception in 2012. I can do better in SPAXX money market (risk free rate) than VXUS has done the past 12 years.

whiskeynwaitresses

SPAXX is like 4.8% or something

crazybutthole

SPAXX on fidelity is a guaranteed 5% apr paid monthly. It's variable based on the fed rates - so it may decrease in the future but for now it's rolling over 5% BOXX is similar in gains and reduced tax burden (all dividend interest gains are reinvested automatically to the share price so if you hold for more than 12 months you pay very minimal taxes on gains)

hydrocyanide

You have a choice for your core position at Fidelity. One of the options is SPAXX I think.

Chad__Tyrone

I'm just going to put the remaining 70% of my portfolio into HYSA or SPAXX at this point .

ducatista9

Unless you want to buy a house or some other huge planned expense in the next few years, all your cash / CD / savings money should be in something like VOO. Keep an emergency fund in something like a money market (SPAXX) that pays \~5% that's equal to a few months of expenses. The fastest / safest way to get rich is to get a higher paying job and not increase your expenses. Unfortunately it's hard to give concrete advice beyond that. Another way is to start a successful business but that is much riskier.

Jmb3930

why is your IRA in SPAXX?

offmydingy

>80k - Savings - Citi That's a *really big* emergency fund. You should put some of this to work and invest in something. >12k - Cash Why? See above. >133k - 5 Year CD - Capital One (Maturity September 2027) CDs are notoriously low reward. Once this is matured, put its ass in an S&P index like VTI or VOO, or a total like VT if you want to be even safer. >10k - IRA - Fidelity (SPAXX: Fidelity Government Money Market Fund) Money markets have similar returns to savings accounts or CDs. Throw this in an index also. Once you've invested all your loose cash in indexes or whatever other commenters sell you on.... >400-Gamestop Stop doing stupid shit like this.

Incomprehensible_Tax

If SPAXX is your core position, you don’t have to move in and out of it. You can treat it like cash. So when you buy VOO or whatever, the money needed to buy it will automatically move out of your core. When you sell something, the proceeds will automatically move in. This is only the case for your core account.

SirGlass

Yes you can move in and out of SPAXX anytime Also to be clear a fund like VOO has no guaranteed return, you could hold for 12 years and be down 15%

rahksi

Thank you. So SPAXX can be touched at any time with no penalty right? Once it goes into VOO, what is the downside of removing it? And so if I'm reading correctly. Yield is around 5% for SPAXX and yield is 10% for VOO long term? thank you

SirGlass

Fixed income products like money market funds SPAXX or HYSA or CD/Bonds are fixed income they have a known return over time They are different then equities , or index funds that hold equities like VOO. There is no fixed yeild , if you own a company and the company does good you make money, if it does bad you lose money , if it breaks even you don't gain or lose anything (in simple terms) The long term return of VOO is 10% key word LONG TERM, like average out over 30 years. Year to year it can drop 10-20-30-40-50% , in the 2008/2009 period it dropped 55% from its previous high

rahksi

So I have $30k sitting in a SPAXX core fidelity money market account. It's about 4.97% yield. Can this be better safely invested? I don't need to touch it CDs/bonds are around 5.2% yield. Is there any reason why I shouldnt just throw it into an index fund like VOO? I don't understand what that yield is though. Is it 10%? Should I max out my Roth IRA contribution from that $30k first? What's that yield look like? Thank you. I'm 28 and my other investment is a work 401a that is 5% my salary and my employer matches 25% of my salary.

lexbuck

Yeah. Thanks. Any cash deposited just goes into SPAXX automatically. I’m not sure what I have to do to change it into something else even if I wanted to. There’s no selling involved is there?

Dull_Translator9692

I like SPAXX

lexbuck

Yeah I’m not even sure I can swap to that fund or if I’ve got to stay with SPAXX. Probably doesn’t matter at the end of the day

lexbuck

Same for SPAXX on Fidelity. It’s not 5.28% but it’s close to 5 I believe

ngordo319

There are others at 5 as well. My core position is SPAXX but I move it to FDLXX because FDLXX is exempt from state taxes.

1-RogueOne-1

SPAXX

1-RogueOne-1

The cash position in Fidelity is 2.72%. If you buy SPAXX MMF, its approximately 5%

s32bangdort

While you are trying to figure out what to do with it, you should at least be getting 5% on it. You can open a Fidelity individual brokerage account and deposit your money there and it will go into their SPAXX money market fund that has 30 day yield of about 5.3%. Easy Peezy. You could also buy the SGOV treasury bill ETF but it’s not really worth it for 3800 bucks. The only difference really is that the interest on SGOV will be state tax exempt otherwise, they are yielding about the same right now.

crazybutthole

If you just get a fidelity account and buy SPAXX it's us treasuries that pay guaranteed 5%

1-RogueOne-1

You can put your money in SPAXX if you want to get a higher interest rate than 2.70%, but I do not. Currently just leaving your money anywhere in Fidelity will yield the 2.70%. You can also confirm this by calling Fidelity or just check your account every few months. Putting your unused money in SPAXX will get you a higher yield, but like I said, I do not use that option. Currently, my extra money goes to Capital One for the 4.25% that is calculated every day and released into your account every 30 days, causing compound interest without you doing anything.

venom_holic_

fidelity as in SPAXX?

jnads

I should correct myself, the weighted average maturity for SPAXX is 76 days it's extremely short risk periods. The fund can dip the securities will mature so quickly it will recover. It can easily be used as a savings fund.

jnads

SPAXX is a Treasury money market If that fails then your money isn't worth anything to begin with. The bigger risk is if rates rise again the fund can dip and you can have less money than you put in (until the interest payouts catch up).

Zee_Ell

You could do half HYSA and half QQQ, or you could do half SPAXX/SGOV/BOXX and half with the HFEA strategy (55% TQQQ, 45% TMF) or similar, slightly less risky strategy (75% NTSX, 25% DBMF/KMLM). Use that leverage to your benefit where you can!

Charming_Jury_8688

DXY, VIX, Business Cycle, Market-Breadth, Complacency, AI-hype cycle. If you're choking on smoke, your house might be on fire. Fidelity brokerage accounts automatically have cash sit in SPAXX, a money market fund.

venom_holic_

yes I have SPAXX on my mind too but the thing is its not FDIC insured to we cant just dump in our life savings or something like that right, its not safe and high risk tooo!

gibbonwalker

I looked into this recently and settled on a Fidelity brokerage account which can be used similarly to a HYSA. It has a "core position" money market fund that your balance is automatically put into and automatically withdrawn from when you move money. There are also unlimited transfers in and out and the ability to get a debit card, so the brokerage account can be used like a high yield checking account. The core position SPAXX is yielding \~5% right now. My next choices and the reason for them were: - Amex. 4.25% is great but not as competitive as the 5% offered by other banks right now. Amex has good customer service though and is the least likely imo to result in me suddenly not having access to my money - Marcus by Goldman Sachs. High yield by an established bank. I've seen some rumors online though about Goldman Sachs planning on shutting down their HYSA offering so I'd be anxious about that possibility and the potential difficulty it could pose as people rush to get their money out - Wealthfront. High yield and great UX but too many horror stories on Reddit about people getting their account locked for seemingly no reason and having way too hard of a time getting hold of support. Similarly, since Wealthfront itself isn't a bank, if they go down then utilizing the FDIC insurance is trickier because the underlying bank that holds your money hasn't actually failed. Look into what happened with Yotta - SoFi. Similar to Wealthfront though SoFi is itself a bank. Lots of similar stories online about accounts getting frozen and trouble getting in touch with support Keep in mind that savings accounts used to have a limit on the number of transfers per month but the federal law underpinning that has changed so many banks removed the limits as well. Some like Ally still have them, but for all of the above, there is no limit so you can get the high APY while still using the account for things like auto bill payment. I called Amex and Fidelity numerous times while setting up my accounts and transferring money. Each time I was quickly able to get in touch with someone who knew what they were talking about and were helpful. YMMV with the others. Consider that it's not just the highest APY you want, it's the highest APY + confidence your account is safe + ability to talk to CS when you need to (or at least for me it is).

FrostyJellyfish6685

Open a Fidelity brokerage account and drop money in SPAXX

GloomyMelons

I would put it into VOO rn and continue working until I physically couldn't. Working would also help w/ building 401k money and social security. If they're in good health they could easily work till 75-80 min. Look at Biden. He's still working lmao I would also look at 55+ communities. These tend to be cheaper than the the alternative and have less competition. Maybe save the money between ETFs and SPAXX/TBILLS and then at 70 pull the plug on a condo in one of these communities. Make sure when they are retired they have paid the condo off. Dunno if any savings will be left, but now you've built a small amount of social security and 401k money. Try and work until you physically can't. That's it. For the U.S at least.

Buffett_Goes_OTM

Trading and investing how gotten so much nicer now that my account is $500k+. I have $400k of long term positions that have a ton of equity growth in, so the day to day swing action of those positions don’t bother me much. In it for the long haul on these positions. Another $90k in SPAXX yielding ~5% held for personal emergency fund ($45k), cash reserves on 3 properties ($30k), then extra cash savings for paying down mortgage and short term gain taxes ($15k). Then, I keep ~$30k to trade options. Every 2 weeks I withdraw and move over any earnings to SPAXX for eventually paying down the mortgage and taxes. + I’m investing another $7k a month through my job. DCAing all this money. YOLO.

Buffett_Goes_OTM

Just withdrew $17k of winnings for the last two weeks. Added into SPAXX where it’ll eventually pay off my mortgage.

kewli

FIRE FIRE FIRE FIRE FIRE FIRE. This is abysmal. If you went on your own \~5% is roughly minimum year over year with no fees if you put your money in SPAXX or similar HYSA, annually.

CommandOk50

TMF 43% SPAXX 26% TSLA 25% PLTR 6% I had smaller percentages in TSLA and PLTR, but they went up a lot in the last month, and I have the minimum amount of shares I feel comfortable with, so I don’t want to sell. I expect them to fall 50-75% because their high price is for things that aren’t going to happen for 5-10 years. If there’s a recession and they crash, I’ll try to have each one take up 30% of my portfolio. Hopefully TMF will rebound as the fed fund rate comes down, then I”ll sell TMF and move it into TQQQ, UPRO, and any quality names that are oversold.

anthonyjh21

Yep Fidelity has the choice to make SPAXX your default position but you have to select it as the default sweep (just use the virtual assistant for anyone curious). I forget what the default fund is but it's half the rate of SPAXX. Because I live in California I buy FDLXX in my cash management account due to ~90% less (state) tax. Any automatic payments for CCs etc automatically sell off whatever is needed. Fidelity has its bugs, such as glitchy transfer system, automated investments and issues sometimes with account changes BUT they're IMO the best all in one place to bank and invest. So yeah I think you're spot on with your explanation!

sirzoop

SPAXX has a higher expense ratio than VMFXX

The247Kid

SPAXX. Just know it’s a 24 hour liquidity.

crazybutthole

If you know you will hold it in the account for more than one year - BOXX has similar returns to a money market account with a lot lower tax implications. In my emergency fund / "savings" - I have 70% SPAXX 15% BOXX and 15% VOO and slowly adding a bit more allocation to BOXX over time.

KReddit934

HYSA (Ally) or Treasury bills or money market fund. Fidelity has a SPAXX which pays pretty well. Just check back on interest rates as the Fed changes theirs.

Chad__Tyrone

Wtf dude.. hysa or even open a real brokerage like Fidelity and keep in your brokerage account. SPAXX @4.95% APY about rn..

Chad__Tyrone

Keep it in SPAXX or HYSA 

Search327

I have Fidelity also, the one advantage Fidelity has over Schwab is when money is deposited into a brokerage account they are automatically placed into your core account (SPAXX). I believe it's called a sweep account. Whereas with Schwab I need to manually buy SWVXX. In my option they are both the gold standard in the industry.

Kramer-Melanosky

SPAXX’s last one year return is 5.09%. So you’re definitely wrong. You can check for VMFXX as well I bet it would be even higher.

Zee_Ell

Everyone seems to be ignoring the fact that you have no essential monthly expenses rn bc of your job. While it’s possible you could lose your scholarship (if your GPA falls) or your job (HIGHLY unlikely as an RA though, at least at my school), those scenarios are pretty unlikely and have very little to do with what happens in a stock market crash (RAs don’t get laid off like that). So here’s what you should do… 1. Open a Roth IRA with Fidelity to contribute however much you can toward your current annual limit. (This is tax-free money for you in the future that you can’t go back and make up for later. Also I recommend Fidelity bc they have no fees for so many things most other brokerages charge for.) 2. In the Roth IRA, invest 50% of your money into either FXAIX, VTI, or VT. Invest the other 50% into something that is not correlated at all with equities, examples being bonds, managed futures, and cash equivalents. I personally would do 50% into the leveraged stocks/bonds ETF NTSX and the other 50% into the managed futures ETF DBMF, but it’s important to only invest in what you understand! So for you, I’ll recommend FXAIX and a cash equivalent (SPAXX, SGOV, BOXX, etc., all with very nice yields). 3. If the worst case scenario happens, you can take your contributions (not your earnings) right back out of your Roth IRA penalty-free and tax-free, and since you’re invested in different uncorrelated assets, you can start with only withdrawing whichever one is not at a loss/is losing less. But the worst case scenario seems very unlikely in your situation, so just keep letting that money grow and trying to earn more money to put into that account. This will function as a back-up emergency savings account. 4. Open a credit card and start building your credit score if you haven’t already. Credit cards can buy you up to a month in most cases (or longer if you are willing to take on interest, which I don’t recommend) of extra time to pay off your expenses in that worst case scenario. There are so many good student credit cards out there; let me know if you need recs.

Bigleftbowski

Open a Fidelity account - free checking, and you get 4.5% from SPAXX.

trashpandamagic

I use fidelity for my checking and savings. Cash in these account are in SPAXX so it gives way more interest than a normal banks. Their cash accounts can link a debit card and you get reimbursed for ALL fees associated with an ATM withdrawal. It's pretty nifty.

Reisefieber2022

Three month US T-Bills can get, say 5.3-5.4%....ish risk free if you roll or ladder them every three months. This is best for that sum, imo. SPAXX - Money market, can get, say 4.8%...ish risk free. Consider SGOV. I'm still trying to figure out if that one is completely risk free or not, but I think it is. Longer term bond funds, or most funds with a return above 5.4/5.5% right now are going to carry some sort of risk, either duration, interest rate, or default.

Buffett_Goes_OTM

Sitting on 77k in SPAXX as well and 40k in cash which I use for trading options.

Due-Set5398

In the case of my Fidelity money market account, I had a legacy option paying 3% or SPAXX paying 5% so it was just a no brainer. I didn’t think harder than that. Fidelity had a notification of a new option with better returns and I clicked one button to switch.

Sea_End_1893

You can pay with SPAXX in a roundabout way. When paying off your Fidelity card you can choose to use money in SPAXX or from another checking account - I used Chase for the longest time as a veteran because no fees, extra benefits. I learned hardcore, dollar to cents, budgeting in the Navy. Spreadsheets and all. I know my income and keep my spending below that. I have all my recurring charges like the cell family plan, Hulu, Prime, on my CC churning points for free money, which goes into SPAXX making more free money. Two decades ago I'd think it was fucking insane how people say you have to spend money to make money. Now my CC pays all my yearly subscriptions in points earned. What the fuuuuuck. I buy weed and beer on my CC and those points gain interest so I can watch Grand Tour and Star Wars.

Due-Set5398

As soon as I saw SPAXX, I switched to it. Now my Fidelity credit card 2% cash back earns 4.95%. Pretty amazing. Started using their Roth too.

Sea_End_1893

I know I might come off like a paid shill, but BUT I started using Fidelity as my bank. SPAXX is my primary position turning 5% and whatever I don't spend, by the 1st, goes into their big cap zero fee fund, FNILX. I couple this with thier credit card and get 2% back on all purchases into my SPAXX just tuning free money into more free money. Also, as for Texas housing, consider things like "sweat equity." You gonna sweat doing yard work every week, or roofing in the summer, when it is a hundred and five degrees out (The UK has a deathly heatwave with a kill count.. at 78 degrees..) or you can sweat paying others to do it- vs renting a condo and having the managers fuck with it. I'd always posit, if you're Texan at heart, Nevada is the freedom state Texas pretends to be. Buy a legal gatling gun to protect your legally-owned tigers from bandits.

CommandOk50

TMF 44% SPAXX 26% TSLA 24% PLTR 6% I am planning on rate cuts in September or November and am not worried about inflation spiking again. I figure TSLA and PLTR will drop in price, and I want to add if that happens so both positions are 30% each. Then I’ll sell TMF and try to buy small cap value, TQQQ, UPRO, and BTC if we go into a recession next year.

crazybutthole

If you want emergency fund more liquid....fidelity offers SPAXX and BOXX Both average at or above 5% with very very low risk. (Near zero risk)

Bane68

SPAXX and other money market accounts (not sure if they ALL do) have dividends and capital gains. I’m really new to this, so I’m just trying to learn 😅

Bane68

Wait. If I just leave money in SPAXX and never take it out (invest it or just leave it in SPAXX), it won’t get taxed??

INVEST-ASTS

Do you keep cash at times because Fidelity has some of the best rates on cash in their SPAXX account. That’s one of the main reasons I use Fidelity because I park cash between trades and the cash need to be working for me until I find it another job to do.

Chipware

I'm on a Mac, so I left Fidelity because Active Trader Pro is garbage. TOS on Schwab is ok but there's no SPAXX and their fills are garbage. Plus there there are bugs in their implementation of TOS and outages in the post-TDA world. I'm thinking of swiching to Webull. They do the 5% interest on unused cash thing that SPAXX does and their trading interface is pretty good on both Mac and Android. I know they don't get great fills but I think I can live with that.

Endgameplays

What is the point of doing this when the rates arent fixed and a something like SPAXX is at 4.9%?

thethrifter

I'd go 80% VOO, 10% VTI, 10% SPAXX. Rebalancing pierodically also reduces risk if one gets overweight.

crazybutthole

Did you know if you put the same money in a fidelity account and don't invest it - it is placed in SPAXX which makes slightly higher than 5% APY And you could pull out your money at any time an emergency comes up rather than having to wait 3 months for your CD to mature I would only do a CD if you can get tax benefits. SPAXX is just as good and more liquid

Disastrous_Equal8589

I read it as OP maxed out their Roth which has 20k invested in SPAXX and want to put it to work. There was no mention of what the Roth is invested in or about opening up an IND account. I’ll let OP advise

SmarterThanAEinstein

Can I invest in SPAXX from anywhere or do you need a fidelity account? thanks

schrute-bux

Do you have an emergency fund? You should have a ~6 month emergency fund in cash or equivalents. Money market funds are cash equivalents. If you're saving for a house or car in the next 4-5 years, that should also go in a cash equivalent. >I know [FXAIX] has a higher risk than a money market (SPAXX) Yes because they are completely different vehicles. One is investing, and the other isn't. Cash you may need soon, or can't risk losing, should be in a cash equivalent. Everything else can be invested.

Laura2start

I read on a blog that idle cash is automatically invested in SPAXX to earn dividends, but how often does it distribute the dividend, and does it require it to sit there for a certain amount of time? The only con I can think of is the taxable event comparing that to putting it in a bond, but it keeps it truly liquid for other investment options. Is that the correct thinking?

GaylrdFocker

Use SPRXX instead of SPAXX.

ajl009

I had thought SPAXX was just a place to hold my money before buying more ETFs. I could just keep my money in there like a bank and make 4.96??

andrewmadd

Here is my recommended steps: 1) Rainy day fund with 1 yr of living expenses. Put that mainly in an interest bearing account, righter high yield savings or SPAXX 2) Remainder in VOO or SPY. S&P average annual return is ~15%, so a better return than the first. This should give you enough flexibility to cover living costs without sacrificing a decent return on savings.

ginbooth

If you're with Fidelity, why not park in SPAXX? Functions as a HYSA with a decent rate as of right now and you have immediate access.

Walden_Walkabout

There is no guarantee that the rates of the CD would not be dropping along with SPAXX. Obviously this is all hypothetical based on the inherently unknowable and difficult to predict future rates, but the entire point of CDs is to remove uncertainty. Your advice isn't inherently bad for someone who is fine with a short term return and the possible need for liquid cash in the near future, but if they are planning on needing/wanting a predictable return for a few years a CD ladder might be more appropriate for them. Saying CDs make zero sense is nonsense because there are people it absolutely makes sense for.

SkiTheBoat

> There is a very good chance that the yield for SPAXX will drop before the end of the year if the Fed ends up cutting like they are projecting Is this the same projection that made people think there would be 4, then 3, then 2, and now maybe 1 rate cut this year? Not very trustworthy... They can ride out SPAXX until the 7-day yield drops below a CD with the right term for them, then they can buy that CD. There are options available

Walden_Walkabout

Depends on if they want to lock in the rate for a certain amount of time. There is a very good chance that the yield for SPAXX will drop before the end of the year if the Fed ends up cutting like they are projecting, meanwhile there are CDs that can lock in a comparable rate for a year or two (Schwab has a 2 year CD with a 5.3% APY for comparison).

KReddit934

I would vote for SPAXX, too. Rent for now. If you don't like the city, why are you moving there again? It's too early to need the help for yourself, yes?

thursdaynext1

Well, you could make about $3300/month at current interest rates by putting it in HYSA or a money market like SPAXX at Fidelity (right now with 4.96% 7-day-yield. Or you put it in a zero-fee total market fund like FZROX. What you should definitely not do is actively invest in individual stocks or options and get wrecked. Don't do anything stupid.

SkiTheBoat

> Pretty much set up some CDs and treasuries /u/LLGaverageoldlady - SPAXX is currently paying 4.96% and would be completely liquid. This is more than any CD offered by Ally, and likely most banks. CDs make zero sense at this time. If you are extremely risk averse, plop it in SPAXX. If you have an average risk tolerance, plop it in VOO/VTI.

Sp00kyMulder82

Fidelity’s is SPAXX for example. Some banks do MM funds from what I’ve heard and you can write checks again them. I recently started buying T-Bills with Interactive Brokers and I’m getting .4% more than MM

paq12x

If you buy directly from the US treasury, you'll give up 3 months' worth of interest if you cash out early. If you buy the bonds from the secondary market (via a broker), you can just sell them just like an ETF. You'll pay a small fee and a commission for that service, however. She needs to know what her emergency fund is and keep that in HYSA or SPAXX equivalent. Keeping the entire 80k in a HYSA for emergencies is inefficient. If she needs 80k@5% to supplement her steady income then that's not negotiable. The emergency fund comes from the 200k leftover bucket. Realistically, a safe withdrawal rate is around 4% for an S&P index fund. She can put 180k into an index fund and take out 4% (7.5k)+ inflation adjustments per year and won't run out of money during her remaining years. If that fits within her budget then she's golden. Ladder the bonds, dump everything into the S&P index. If the market is down, use the bond interest and don't sell.

1234567qwert

Solid choice. What are your thoughts on using SGOV to park money? earning more than SPAXX, but a sort of pseudo HYSA ?

spicysubu

No, dividends cannot count as earned income so. I think the person you’re replying to was intending to specify the tax rate at which the SPAXX would be taxed but should have said ordinary income (at the marginal tax rate). Also, the portion of dividends received from SPAXX from federal treasuries can be exempt from state taxes.

AyYoDeano

If she went the SPAXX route, and that 9900 is treated as earned income, does that allow her to then contribute to/max a Roth IRA?

Komtings

HYSA is an option but why not put it into a brokerage account with one like Fidelity and leave it in the default money market fund they provide? I park my cash in the default of SPAXX where it earns around 4-5% and has monthly dividends which are reinvested automatically. It doesn't beat inflation but I like to leave it there instead of where my emergency fund is (HYSA) earning less.

schrute-bux

Better rates...SPAXX is currently below 5%, SPRXX is 5.02%, and TTTXX is at 5.19%

Neat-Ad2953

SPAXX

CommandOk50

41% TMF 34% SPAXX 19% TSLA 6% PLTR I see more upside for 20-30 yr treasuries this year than equities overall. I think stocks will fall when they start cutting rates in September or November.

failf0rward

Nothing is guaranteed anywhere for interest rates but SPAXX Fidelity money market currently pays 4.95% and your checking and savings can both be in the same pile.

MarcosMilla_YouTube

SPAXX is more of a HYSA alternative. Same concept in my opinion as a HYSA just not with a traditional bank and instead with a brokerage like Fidelity which also offers various financial services

Xzyrvex

You can definitely use it as a HYSA alternative. Currently I'm pretty sure it's at around 5% so pretty damn great. If you want to not invest your savings but just let them grow, just put your money into fidelity and it'll automatically invest them into SPAXX. If you want to invest in the stock market that's something completely different. Good luck!

lafindestase

* 28% SPAXX (dry powder/emergency fund/etc, been using to DCA) * 28% VOO * 23% VT * 14% sealed trading cards * 8% VUX * 2% ASTS (small moonshot)

ECHuSTLe

I feel like I missed out on this bull run as well but at least my money is in SPAXX earning close to 5% annually. Oh well, I’ve been waiting for a pull back for 6+ months now and it’s not going to happen anytime soon especially since this is an election year.

Vaun_X

Fidelity, no contest. Merrill is much less friendly at <$250k assets. Fidelity's floor on interest is around 5% with automatic sweep into SPAXX (To get that at Merrill you have to manually invest in money markets. E.g. TTTXX.) Fidelity's fees are either lower or non-existent across the board. Merrill's can be waived with assets. BofA has better credit cards *if* >$100k Source: I have both.

AndrewBorg1126

I have for instance a few accounts with Fidelity. One of these accounts I use as a checking account. The money in this account is earning an annualized 7-day yield of 4.95% (SPAXX). I'm not sure what you mean about things timing out.

plasmaticD

I went through the transition from e-trade ( before they became morgan stanley) and chose Fidelity. I know, not TD Ameritrade, but similar experience probably. Fidelity's investor support tools are better than e-trades were, including their dividend view tab. Any brokerage change will incur lots of initial busy work ( opening the accounts, specifying beneficiaries, adding your bank credentials for transfers, etc.). Can't be helped. I had a couple of CD's with several weeks left to maturity, their transfer was delayed until redemption and settlement enabled cash transfer. Everything else transferred in kind like for like without a hitch. Fidelity offers a money market cash sweep fund (SPAXX) with a pretty decent yield and it's automatic and effortless in action. While I'm a self directed investor, I was invited to call a Fidelity fixed income advisor, who was extremely helpful in orientation to website features. This was useful, did not incur fees, and I recommend it.

DeeDee_Z

Consider SP**R**XX instead of SPAXX, if you want to keep something in MM funds.