SPAXX

Hogweenies

Greetings, I'm a 23 yo truck driver based out of California (Over the Road so I won't be paying rent) saving for a house in a LCOL state such as Nebraska or North Dakota and want some advice on what would be the better route for my timetable. I currently bank with Fidelity and have SPAXX as my core position. Have been debating whether to keep it there or let things like VOO work their magic? Or maybe put it in a HYSA? What would be the smarter move for my timetable? Basically anything I make will be going towards either this or any necessary bills/ food. Thanks for any and all replies.

Wolvshammy

Holy shit you guys. SPAXX is my cash. Space X is in another account.

benjamin_noah

Wait… is this guy confusing SPAXX with SPCX?

TragicIcicle

I'm selling cash secured puts to double dip SPAXX and capitalize on the run with minimal commitment..so far so good thanks regards

Ahamadrayasbaboon

*SPAXX

Informal-Lime6396

What I mean is you have a risk free option called SPAXX which is the default cash position in Fidelity. It seems like you're sure that the bull market will continue through December, in which case the S&P 500 will be a great option. Fingers crossed.

Level-Possibility-69

SPAXX counts toward SpaceX???

heretogetpwned

It's good practice increasing your contributions to retirement and debts once per year. With more car loans going beyond 5 years you can really shave down the payments by year 3. I'm paid off but I bought slightly used Dec 2020 at 3% and I don't expect to see a deal like that for a long time. I will eventually need a new vehicle and SPAXX Money Market is at 3.24% so I'm sending my "car payment" there and shaving off a monthly percentage into a low drag etf in my brokerage. Goal is to buy another slightly used vehicle without a loan.

Reynhart

??? Fidelity does too (with SPAXX core position) I tend to see more price improvements over orders in Fidelity vs Robinhood as well. The only reason to use Robinhood imo is for the 3% matching in IRA contributions since those help overcome the hard contribution limits.

ATPsynthase12

You don’t need a financial advisor at all. They are just middle men who harvest 1-3% of your portfolio per year and often either lose you money (via outright losses or sub par performance) or go full big brain moves to beat the S&P 500 and again end up losing your money. Or, they intentionally do stupid things to make more money off of you such as putting money on a corporate bond fund. Pull your money out and transfer it to a fidelity brokerage SPAXX account. Once the cash has settled invest it in the following; 50% VTI (vanguard total stock market index), 30% VXUS (vanguard total non US stock market), and 20% in BND. If you are not retiring soon or want more growth, do 70% VTI, 30% VXUS. Although, at your age, there is a strong argument to include bonds or TIPS to ensure you have less volatility and cash on hand if needed. That’s it. Contribute monthly, reinvest the dividends and let the compound interest grow. DO NOT TOUCH IT until you hit the amount you can draw 4% per year without depleting your accounts. Once you hit that point you can retire and are fully financially independent. Check out the wiki on r/bogleheads if you want more info.

tk421tech

I sold some VXUS and BND on Friday that is you see in SPAXX, to possibly put in VOO. Hence this post.

vapingpigeon94

Already knees deep on NVDA CC. I keep rolling it till either NVDA comes down or eventually I’ll need the money and I let them get called away. Currently most of money sits on SPAXX Fidelity money market and am making around 3% year. I also try to sell CSPs to kind of double dip on SPAXX with CSPs premiums. The downside is I could end up owing the stock but I’m picking stocks I like. If I could get that 5% yearly without doing all this extra work it’d be great.

tk421tech

It was VOO 40%, VXUS & BND 30%. Retiring in 10 yrs. (Seems it might only grow to about 100k with contributions). Prior to today I thought perhaps 60/25/15 might be a better goal. Current % 33.50/17.42/15.87 and 33.21 in SPAXX to rebalance.

sellputsthencalls

Since you're using this r/options community, I presume you want to get 6%/yr using an option strategy. By the way, if you simply buy SPY (the S&P 500 ETF) or FXAIX (Fidelity's S&P 500 fund), which has averaged 15%/yr over the last 10 yrs, your chances of 6%/yr are quite good. But because the S&P 500 lost 18% in '22 & 4% in '18, you may be uncomfortable with that risk. Here's an option idea: Use SPY, @ $742 today (5/21/26). Place $75K in a brokerage account's MMF. In a year, $75K @ 6% will provide you with $4,500, your target. That's a $375/mon target. I use Fidelity. Its SPAXX MMF has a 7-day yield of 3.23%; times $75K = $2,422 a year or $202/mon. Fidelity (& some other brokerages) pays MMF interest on the reserve that's held for CSPs (cash secured puts). Sell 1 SPY CSP, expiring on 6/18/26 (28 days), with a $685 strike price. For the one month commitment, you'll receive a $1.74 premium = $174. That $174 CSP premium + the $202 MMF interest (3.23% on the $68,500 CSP reserve & the remaining $6,500 in the SPAXX MMF) totals $376 for the month, satisfying your 1st month towards the 1 year target of $4,500 or 6%. Fidelity's probability calculator says that this CSP has a 2% assignment chance/98% expire worthless chance. If it expires worthless, sell a similar CSP for the next month. If you get assigned to buy 100 SPY @ $685, your $68,500 CSP reserve will cover it & your remaining $6,500 in MMF will continue paying some interest. You can then sell a CC (covered call) versus SPY, always aiming to generate $375/mon in premium + MMF interest.

Successful-Power2026

You’re already ahead of most people your age just by thinking this far ahead. If your goal is starting a plumbing business in like 6 years, I’d personally keep doing mostly SPAXX/cash-like holdings and gradually add to something broad like VOO rather than chasing individual stocks. Protecting the money matters more than trying to maximize returns right now.

u_spawnTrapd

Honestly your plan already sounds way more thought out than most people at 17. The fact you’re thinking about risk, timelines, and keeping expenses low is a really good sign. For a 5–6 year goal like starting a business, I’d personally be careful about going too heavy into individual stocks. VOO already gives you market exposure without one bad pick wrecking your plans. SPAXX also makes sense if you want stability for money you know you’ll need soon. A lot of people underestimate how valuable having cash ready at the right time is. Also, plumbing + living at home + consistently saving is kind of a killer combo financially if you stick with it. You’re setting yourself up well already.

buttershiro

you’re actually in a strong spot for 17, especially already thinking about balancing safety vs growth for a future business. your concern about a market drop hitting right when you need the money is valid, and that’s exactly why your SPAXX + VOO setup makes sense for a 5–6 year goal. individual stocks can sound tempting, but they add a lot of risk without much advantage unless you’re willing to study and stomach big swings. for your timeline, consistency and capital protection matter more than chasing higher returns. if you ever want a simple way to keep your savings + investing plan organized as it grows, Fina Money can help you track it without overcomplicating things.

brother7

SPAXX is for savers, stocks are for investors. Having said that, I discourage owning individual stocks. The safer way to own stocks is through ETFs, and one of the safer ETFs is the Vanguard Total Stock Market ETF (VTI). But since you already own VOO, that's just as good. If you have earned income, I suggest you have a parent help you open a Roth IRA for Youth at Fidelity. It's the most tax-efficient way to invest for your future retirement.

InvestingNerd2020

I like SGOV, but the state tax rate in Georgia is so low it is hardly felt. I think 5% if I am not mistaken (too lazy to look it up). SPAXX is fine for now. Worst case scenario the OP can always switch to SGOV or VBIL later.

InvestingNerd2020

Noo! Don't fall for the trap of buying multiple individual stocks. Even experts who devote 50 hours per week still cannot beat the S&P 500 90% of the time. Stick with VOO or FXAIX in a Fidelity Roth IRA. Both follow the S&P 500 index, but FXAIX is less expensive (expense ratio of 0.015% vs 0.03%). Good idea of using SPAXX for a savings account in their taxable brokerage account. Also, make sure you have a good business checking account. Capital One is nice, but only 1 location to deposit cash (Atlanta). Chase might bet the best option if you need more locations to deposit cash.

Various_Couple_764

Money market account like SPAXX the share pice is fixed at $1. So if the market crashes you won't loose any money you withdraw the fund. With with dividend and growth ETF the shares price is very close to the Net Assessed Value of the stock and cash the fund holds. So if the market crashes the share price of ETF drop. So Growth or ETF are generally bad choices for short term savings due to market But for longer term savings ETF can have better returns.

D_Pablo67

You have a good life plan. I would do half SPAXX and half VOO. In six years, you will likely spend a lot of your resources on starting a plumbing company, so a high cash allocation is fine.

kirlandwater

> while putting less money into SPAXX but still most of it, but I’m wondering if the risk is worth it as if let’s say the market crashes right before I’m planning to start my business I wouldn’t have time to let the market recover You’ve got the most pressing issue understood, which is great. Personally I think your 75/25 split is good, maybe expand to VTI over VOO for a touch of broader diversification, without sacrificing much if any growth. Though you’ll want to taper down every year from 25% stocks to 0% and keep it all in SPAXX or something similar for the above reason. For something this “short” term, I would park all of it in SPAXX, but I also don’t want to ever think about the account possibly losing value when I’ll need it just around the corner. However, only 25% you’ve still got a solid amount of growth and taken a lot of the risk off the table. The most important thing you can do is contribute every month as much as you can and you’ll be fine no matter what you choose

pigeon_shit

CSP kinda day. SPAXX double dipping ftw.

trampled93

I’m not sure why the downvote. It is a low risk money market with fluctuating dividends. Now it is 3.26%, last year in May it was 3.92%. I don’t claim to be an expert at investing. I just read lots of recommendations for Fidelity and SPAXX money market account. Tell me why in your opinion it is a bad decision to park uninvested cash temporarily.

trampled93

With a Fidelity brokerage account, your uninvested cash just sitting in your account automatically is invested in SPAXX money market fund and currently earns 3.28% 7 day yield. https://www.fidelity.com/go/manage-cash-rising-costs

pjstarke

I recently implemented a 3-tier cash strategy: -Tier 1 - Fidelity CMA in SPAXX at about 3.3% (functions like a checking account). - Tier 2 - HYSA at OpenBank earning 4.0%. Funds (up to $5,000 daily EFT limit) available in 24 hours. - Tier 3 - Fidelity CMA invested in cash-like high-dividend positions - 10% each of SGOV, CSHI, SCHD, GPIQ, and GPIX. Currently returning about 6.04%. Dividends on all these positions are somehow tax-advantaged. No state tax on SGOV or CSHI, qualified dividends on SCHD, and mostly tax-deferred ROC on GPIQ and GPIX. If interest rates drop I may shift more cash further up the tiers to earn more interest unless I need the cash soon for a specific reason. I’m 5-10 years out from retirement, so trying to build my cash pile/buffer to protect portfolio in down years.

Opening_Aide3713

SPAXX pays a good monthly dividend

SPY-Talk

Mutual funds SPAXX Bond ladder

FiremanHandles

Like the other poster, check out /r/thetagang or do a little googling on The Wheel strategy. I don't follow one specific dogma, but I can tell you, having been selling contracts for a few years now, I have a love / hate relationship with them. Personally, I love CSP's and I hate CC's. CSP's let me double dip on FIDO, earning you the premium + the interest earned on SPAXX. Its actually what drew me to them initially. "I can be a dogshit trader and still earn ~5%" -- that 5% has since dipped (currently 3.26%) I only sell CSP's on things that I'd like to own, that I'm either neutral or bullish on. So turning around and selling a CC on it feels wrong. To counter that I'll typically wait and HODL until there's a spike in price or IV to try and aggressively capture gains during higher volatility. And last... if I get exercised -- a CSP feels like I'm getting to buy at a discount (vs buying when I started the contract) while a CC feels like I'm missing out.

HighPriestofShiloh

Yes it doesn’t always make perfect sense to keep your emergency fund in cash. But that is way smarter than putting it in the market. Park is in a HYSA or money market. But don’t put it in the stock market, that’s insane. Imagine losing your job when the market collapses because of a recession. The moment you finally need your funds they are cut in half before you can access them. Just put it in SPAXX if you want some return.

touron69420

SPAXX

beyondplutola

Why HYSA over letting it sit in a sweep account? Are there any HYSAs paying meaningful amounts over SPAXX?

anon401k95

I’m trying to determine if I should continue investing in primarily FSKAX and if I should continue utilizing a standard 401K, Roth IRA, AND Traditional IRA to diversify my tax-advantage accounts or if I should just consolidate. - 40 years old, living in LCOL area - Sales engineer making between $150k-300k (100% commission) - Only debt is the house which is financed at 2.125% with 80k left on the mortgage, so I don’t necessarily need to move, but it’s the starter home I’ve been in for 12 years and wouldn’t be against moving if the right house came to market. 401k $629k in T.Rowe Retirement 2050 Fidelity Brokerage $561k Total - $326k in FSKAX - $69k in FTEC - $69k in FTIHX - $12k in NIO - $85K in SPAXX/SPRXX Roth IRA $31k Total - $18k in FSKAX - $9k in ARKK - $4k in NIO Traditional IRA $19k Total - All in FSKAX

msaleem

How do you name the account?  We have a SPAXX e-fund at Fidelity too but can’t figure out how to change the name from CASH MANAGEMENT (JOINT WROS). 

UnlikelyPriority812

Just toss savings in your brokerage and keep it as cash. SPAXX is the default when it sits as “cash”. No need to open a new account.

Apex-Editor

SPAXX and SGOV. Plus a small allocation in FXE because I'm a dual citizen in an uncommon situation. I wouldnt recommend that last one to most people.

angel_announcer

SPAXX

No-Assistance476

SPAXX

MementoMoriPendejo

I auto-push my 2% Fido credit card rewards into my SPAXX account too, just for w little extra kick on the deuce.

windowzombie

SPAXX at Fidelity in my general individual brokerage account, 7-day yield of approximately 3.27% to 3.29%.

WeUsedToBeNumber10

I’m in NY. In order for us not to pay income tax on US bond funds, the holdings at the end if each quarter must be at least 50% tax exempt holdings.  SPAXX did not hit that requirement. FDLXX is at like 98%. 

Professional-Bad-410

Yeah. SPAXX or FDLXX are made up heavily in T-bills

Welcome-To-NBA-Jam

Kind of. One option is to bank at the same place as your brokerage. With margin enabled, you can sell, immediately transfer, and the next day it'll be covered after the funds settle. If it's a weekend or holiday then you have to wait until the next open market day for the funds to settle. The other option is to do a Cash Management Account (CMA) with Fidelity. Your funds will be in a money market account (most choose SPAXX) and you get a debit card with it. You can also order checks with it. This is probably the best of both worlds if you have situations where you need cash immediately and cannot wait until the next market day. The interest rate for SPAXX is usually fairly competitive and is 3.28% right now. Another interesting one I've seen people do is to just open a home equity line of credit and simply have it available. Write a convenience check, then cover the loan as soon as you sell your positions elsewhere. You have to do this strategically though and think of it as an ultra short loan to yourself - you can pay people immediately but you can cover it when the market is open, and you really should only use it for that purpose if you're going this route. It's functionally not much different than the margin transfer option, except the loan is tied to your house.

Professional-Bad-410

Yup. Their cash management accounts allow you to put your core position into SPAXX

Professional-Bad-410

SPAXX

Icy_Needleworker844

Another option is to open a fidelity checking account. This can be directed to hold SPAXX. A benefit of this is the physical separation of your emergency funds from your investments.

ChairmanMeow1986

I understand your point, but I think you are ignoring a couple BIG things by reducing this just to taxes. You'd save like 8300$ if you wait until they are long-term cap gains (so about 8% of your gains). So lets look at it like you did exercise your contracts 5 @ 200 strike for 500 shares. Cost-basis would be 100k + the 28742$ premium you paid would leave you at 257.48 a share. I'm going to use the price at close Friday of 455$ (because that's the spot price your contracts value were reflecting). So spot 455$- 257$ (your cost-basis=strike+premium) = 198 gain a share x 500 shares = 99k gains. That 104k vs 99k difference is because of the Greeks, particularly that 7 moths of time value you *already* payed for and are not getting anything for if you exercise. The next big thing to address is downside and risk. AMD moved 11.5% on Friday alone and 26% in the last 5 days and you're over here thinking about exercising to what amounts to 3% in taxes saved in 7 months ***IF*** it levels out at and maintains this price. You seem to assume it will be higher in 7 months, when that is not at all a given, although I'm not discounting the possibility. That is a long time and I like AMD, just not as a buy right now. It can surely go higher, but it is also overextended imo. Which brings me to my last point, 'if the $104K in gains is my only income for the year,' why would you assume that. Take profits and look for a re-entry or another trade, maybe sell 3 or 4 (it's a great time based on the Greeks) and leave a runner to chase momentum. Lock in gains and find another trade or two over the next few weeks, set aside taxes into a safer space (like SPAXX or fidelity pays interest on money held for CSPs for instance). Basically you are assuming oppuronity cost as well by exercising imo. TLDR: it almost never makes sense to exercise if you have significant time value left. If you disagree read the whole comment.

Sharp-Direction-6894

Fellas, I've been here over three years now. Some of you are like family to me. I need insight. I realized that from my $1,018,000 in liquid assets, I have about $280,000 in either cash in my business checking, or sitting in SPAXX in Fidelity. I feel like this is too much cash. It needs to be put to work. I don't want to increase my existing positions, I want new positions and new exposure. Like everyone else, I'm concerned about the high entry points. But I don't want to sit in so much cash. What do I do, seriously?

Over-Computer-6464

I use a bit of everything for my cash-like holdings. Currently my Fidelity account cash-like is split: 22% SPAXX 23% FDZXX 15% BOXX 40% in a 13 rung ladder of 3 month T bills. I will be moving more into BOXX due to the higher post tax returns.

vikingpower89

If I had 10 million, I would be happily living off of dividends or even interest yeild in SPAXX 🤣

Lucky_Platypus341

We use SPAXX in our regular brokerage account for bill pay, direct deposits, have debit card and Fidelity CC, too -- none of which requires a "cash management account." It's becoming our primary account.

mrinvestment123

A lot of people use a Fidelity brokerage account like a hybrid checking/savings account because the uninvested cash can sit in a money market core position like SPAXX which earns a competitive yield automatically Fidelity currently advertises around a 3.29% 7-day yield for SPAXX, though that changes with interest rates Your biggest advatages are: * Higher yield than many traditional banks, especially if your core position is SPAXX instead of FCASH. * Liquidity: money is generally available quickly for investing, transfers, debit card use, or bill pay. * Money market funds like SPAXX are considered very low risk and historically stable.

silentsinner-

Fidelity has a couple of options for your core holding. One is SPAXX which is what I use but I do not remember the other one. You can change this in your account settings. Last year I was thinking about going a lot more conservative with my asset allocation and sold all of my stock in my brokerage and was potentially going to pay off my house. SPAXX was paying 4.25% which is what my mortgage is so I just left it there. It was actually better than my Ally HYSA at the time. I did see some HYSA paying 4.55% but it didn't seem worth creating a new account for. I kept it parked there for about a year while I thought it over until I reinvested recently. SPAXX is down to 3.3%.

IHadTacosYesterday

The key is to have bought Google, AMD, Nvidia and Broadcom many years ago like me, make insane bank... slowly sell as shit pumps, keep the money in SPAXX waiting for a 35% correction in the SPY, then deploy some of the dry powder back in. I'm literally in a position right now where I cannot lose. It's quite spectacular when you really think about it. If the market dumps, I'm fine. I have a HUGE cash pile from all my winnings just waiting for mass panic If the market keeps pumping, then my GOOG, AMD, NVDA and AVGO just keeps mooning.

skilliard7

SGOV/SPAXX are not really hedges, they hardly move at all. They are just reducing exposure to equities. A hedge is generally an asset that moves inversely to another. A better hedge would be: - VGLT/TLT for hedging against recession(long bonds gain a lot of value when economy nosedives and fed does QE) - VTIP for hedging against a short term boost in inflation(TIPS go up in value based on CPI inflation index)

timnuoa

You can even get a debit card and checkbook and treat SPAXX as cash, as liquid as a checking account.

Sirknowit

Brokerage side total $470K of that \~$60K in SGOV rest in 5 other solid ETF. And on the CMA side \~$32K sitting in the SPAXX sweep account incase we need it "now". I don't see a disadvantage. We also have a nice chunk sitting in the Capital One HYSA. If ya don't want to get into the market or not fully in then ANY thing were you're earning some decent interest is better than a crappy no interest account.

GaylrdFocker

SPAXX, SPRXX, SGOV, VBIL, BOXX, etc are all equivalent holdings to a HYSA. I use 3 as different breakdowns of emergency fund, sinking fund, next year's IRA contribution.

DeeDee_Z

> I do (in SPAXX) Also consider SP**R**XX ... and if you have the minimum ($10^^(5)) FZDXX.

Brilliant_Assist_871

I do (in SPAXX). There are HYSAs that can give you a somewhat higher interest rate, but since I'm already doing business with Fidelity, it makes my life easy and keeps my money easily available.

noggin_elastics

A correction is always something to be mindful of and be ready for, but a few thoughts: 1. This is why you want to stay mostly in VTI or VOO....these tend to recover relatively quickly. 2. You should always have a reasonable emergency fund. A SPAXX money market account, etc. will work fine for this. 3. Instead of adjusting policy to start paying down astronomical debt that is now larger than the entire US GDP, the US government has decided the path forward is to further devalue the dollar (which has already lost 93% of its value since 1950). As long as Trump decides to continue driving the dollar lower, stocks that aren't losing value should keep rising to remain equal to what they were in terms of real value. What won't? - a typical bank account, which is losing value in the face of this.

Sirknowit

You've answered your own question I think. It comes down to true liquidity. How soon might you need the money? Immediately!!! Then open the HYSA and the cash is ready all the time. Can wait a day or three for the sale of SGOV to complete and the money to get to your account? Then SGOV is the answer. The middle road is where is the brokerage? We have a chunk of cash at Fidelity. $32K in the CMA in SPAXX earning very close to SGOV numbers another $63K in SGOV on the brokerage side. We also have another $40K sitting in Capital One's HYSA. If I had ONE choice and knew I didn't the money in a couple hours...SGOV and done.

theipd

I triple agree with this. SPAXX for look but don’t touch; SGOV for when the acute urge hits you and you really need it. But for the love of all things good, take some off the table and put it away somewhere where you can’t easily get to it.

znightmaree

A CMA is a Cash Management Account. It is for all intents and purposes a checking account. You can get a debit card and a checkbook etc. In the CMA the default position is SPAXX, which generates a smaller amount of interest than SGOV treasuries, but still better than a normal checking account. You can buy SGOV with your money in the account. When you sell SGOV it takes a business day to settle (T+1) before you can move it around like the money in SPAXX, which is fully liquid. It sounds more complicated than it is. Very easy

znightmaree

Anytime I have a CMA on Fidelity that has about 1/10th of my emergency fund in SPAXX (can be withdrawn or transferred immediately) and the other 9/10ths in SGOV (T+1 settlement but with the aforementioned benefits). Works well for me

Cruian

>SGOV leads to a lower tax on interest than Fidelity's SPAXX. Rarely will you get taxed on state taxes with SGOV. That's likely true. FDLXX may be of interest for people that want the tax benefits of SGOV with the convenience benefits of SPAXX.

InvestingNerd2020

SGOV leads to a lower tax on interest than Fidelity's SPAXX. Rarely will you get taxed on state taxes with SGOV. It's great if you live in California, New York state, New Jersey state, or Hawaii. SPAXX is better if you live in one of the 9 states without state taxes. Examples: Texas, Florida, Washington state, and Neveda to name a few.

brother7

Dollar cost average. Invest $1000/week for 20 weeks. Use Fidelity brokerage. Set Dividends and Capital Gains to Reinvest. Set core holding to SPAXX.

Cruian

SPAXX is a money market fund that can be used as a default position (deposit money and don't invest it? It but SPAXX), currently at a 3.29% 7 day yield. Schwab's uninvested cash seems to be far lower: https://www.schwab.com/cash-investments & https://www.reddit.com/r/Schwab/comments/1c6frn9/what_is_default_money_market_for_cash_in_schwab/ Robinhood seems to be a decent rate for Gold members only? https://robinhood.com/us/en/support/articles/cash-program-interest-rate/

Worth-Dress-2902

What is SPAXX? What’s the difference of that vs a cash balance in, let’s say, Charles Schwab or Robinhood?

DikenIkes

Great! Now if they could allow for a core MMF position to park cash similar to SPAXX, that would be amazing as well

counterhit121

I sold like 2/3 of my VTI and threw it in SPAXX, but I'm holding on to my much bigger positions on RDDT and NFLX

MX396

I'm 61, in the 22% Fed tax bracket, live in WA state (no state income tax) and don't plan to retire in the next few years. Because reasons, I have both a Schwab and Fidelity taxable brokerage fund. I recently sold some funds in Schwab and have about $50K in cash in each (which is about 20% of the total). The Fidelity cash is in SPAXX, which I just realized has a kinda stupidly high expense ratio. IIRC, the "uninvested cash" at Schwab by default earns basically nothing, so I should move some of that into a better fund ASAP, unless/until I decide to plow it back into stocks, which might be soon, but maybe not... Suggestions of better (higher % or cheaper ER) funds for these accounts?

underpaidorphan

By 30% cash, do you mean literal cash? Or in a SPAXX cash account? Asking for a friend.

Easik

The average person should put it into the S&P500 (SPYM) and never touch it. Since that's you, that's what you should do. You should roll over the 401k immediately to an IRA. If you want to try to time a good entry, then let it sit in SGOV or SPAXX until you decide when to buy. I can promise you that you will lose money if you try to trade, especially in this political climate.

Rez_X_RS

I'm almost always 100% cash, and i love it, it makes me sleep better at night. I don't intra day trade options, but I will trade poor man's covered calls and sell: credit spreads, butterflys, and condors. Then I intra day trade with actual shares of companies. It's nice to generate cash from: SPAXX, spreads, and trades all while enjoying freedom of not being locked into long positions.

BreadfruitOk6788

I didn’t buy so now have $6k sitting in SPAXX no worries I’ll just wait for the next 🥭 created disaster

DeadL

Keeping 40k in an Apple Savings Account (3.65%) or Fidelity SPAXX (3.27%) would get you something around $109 - $122 per month in interest and you keep your 40k. Something like that could be a decent emergency fund for you as long as you don't get tempted to spend it on a car or something dumb lol. The best thing to do is just place it into something like the Vanguard S&P 500 ETF (VOO) and slowly contribute to it over the next 30-40 years. That market tracking ETF would be like this: > At 10% return → doubles every ~7.2 years > At 7% return → doubles every ~10.3 years > At 6% return → doubles every ~12 years

NewSeaworthiness8814

> very safe assets Thoughts on what this could be? Something other than a money market fund like SPAXX? Maybe bonds or something?

stealthlysprockets

Sounds like you have fidelity. SPAXX is a core position where for each dollar you put in, you get 1 share of Spaxx which has a monthly dividend payout. If this is in a CMA account this is functionally similar to a high yield savings account. HYSA comes in roughly 3.2% interest where spaxx is closer to 3.4%.

QuantumDreamer41

I have my money in a money market fund. Is there any advantage to SPAXX over this?

DazzlingResource561

Timing market is a fool’s errand until it isn’t. If really worried park in money market like SPAXX for a season.

UnderB0SS

Meanwhile my guy is sitting on unrealized losses and SPAXX making him interest each month. 😂

MitchCurry

Fidelity's MM (SPAXX) is paying 3.3%. SOFI will give you 4.5% on balances up to $20,000 (costs $10/mo to be a Plus member) and 3.3% on everything above $20,000. Marcus CD rates are paying 4.05% for a 9mo term, 4% for a 6mo, 12mo, and 18mo term, and 3.95% for a 2yr term. There are definitely options out there that pay a good rate without risking your principal.

fallingdowndizzyvr

> If it matters, I'm in California and I understand SGOV is more tax-efficient than SPAXX If you are going to be living overseas, why maintain California residency and thus California income tax. Get residency in a tax friendly state.

FrankDrebinOnReddit

Yeah, I would (and do) use SGOV over SPAXX for my emergency cash position. Much better expense ratio plus the state tax exemption.

PHL1365

Thanks again. I just received a portion of the cash so it's currently sitting in SPAXX. Does it make sense to buy SGOV immediately until I figure out a strategy? I already have an emergency fund, so no concerns about liquidity.

Unique_Mortgage_7827

Moving cash from HYSA to taxable brokerage. No immediate purchases planned but want to maintain some liquidity while focusing some capital towards growth and long term holdings. Wanting so capture some of the potential AI growth. Been educating myself via most available online tools but looking for thoughts, opinions and recommendations. TIA $77k Total 30% Cash - SPAXX Core 30% Treasuries - 50% SGOV - 50% USFR 40% Growth - 40% VOO - 20% SMH - 20% AMAT - 20% LRCX

Illustrious-Fan8268

A HYSA gives better returns than SPAXX

phate81

There is nothing wrong with using your brokerage account as emergency savings, so long as you structure it correctly. I personally keep 6 months worth of living expenses between SGOV and SPAXX, then put the rest in ETFs and stocks.

papakong88

When you sell CSP, Fidelity requires you to have a cash equivalent as collateral. (assuming you are approved for CSP only.) Cash equivalents are cash, money market funds, T-bonds of less than 1 year in maturity. Money market funds used as collateral will earn interest. When you sell naked puts, you can use buying power as collateral. Most of your securities have BP. For example, SGOV has 70%, money market has 100% and Treasuries of less than 1 year have 97%. Money market funds used as collateral will not earn interest.  When you have a margin account, you can buy securities with a loan from your broker.  Say you want to buy $1000 of XYZ. You will find from the website that there is an initial margin requirement of 50% and maintenance requirement of 30%. (This is typical. Some stocks are higher.) That means you must have 50% or $500 of BP as collateral to buy. After purchase, the collateral is reduced to 30% or $300. The difference between what you owe and the BP is a loan. For Treasurys, the initial requirement is 10% and the maintenance is 3%. That means you can buy it with 10% but you will have a huge loan. I use Treasuries in my account instead of keeping SPAXX. SPAXX will not earn interest if it is used as collateral to trade options.

CriticismMost3450

Ok I see what you’re saying. Let me rephrase and see if I’m understanding what you’re saying. You can use SPAXX to sell CSP up to the value of your holdings and still collect interest on SPAXX. You can buy TBills and use the value to sell CSP up to the value of your holdings and still collect interest on TBills. I think we are on the same page there. Are you telling me that if you had $100k in TBills, there is a broker that would let you sell $200k in puts and still not pay interest? Which broker does that? I’m interested.

papakong88

SPAXX used as collateral for naked options will be placed in margin credit balance and will not earn interest. SPAXX used as collateral for CSP will earn interest.

CriticismMost3450

SPAXX through fidelity pays interest about the same as a savings account, and the value doesn’t change. You can also use it as collateral to sell naked puts to increase your return.

IHadTacosYesterday

If you have Fidelity, they will put it in SPAXX while your waiting to time your entry. If you have Schwab, they make you literally buy into something similar to SPAXX, punk bee-otches

Anfield_Cowboy

SPAXX

Anfield_Cowboy

401k been sitting in SPAXX looking pretty good today.

Terrible_Lobster5677

It would be a bit inefficient, but I found out Fidelity lets you keep idle money in SPAXX which is pretty appealing for a second brokerage that I wouldn't touch all that often.

DistributionBroad173

For people starting out the Fidelity Zero Expenses Funds puts it over the top. I recommend FNILX all the time. The negative on these Zero Expense Funds, if you get mad at Fidelity, you must sell to get your money out, they are proprietary. I am Vanguard since 1983. I was a Fidelity client from 1996 to 2021 or so. moved it all to Vanguard. why? I had been with Vanguard the longest Vanguard VMFXX actually beats SPAXX, so Vanguard wins the sweep accounts contest. Schwab sweep account pays something like 0.01%. For me, it is either Fidelity or Vanguard. Fidelity has more bells and whistles and real physical offices. Vanguard NEVER asks me to talk to their advisors. Vanguard HQ Campus in Pennsylvania is the only offices site and is under high security. Fidelity has the most money under administration, Vanguard has the most money in Assets under management.