Schwab Value Advantage Money Fund
Okay, I do not like Schwab, just tried with the app of sweeping my cash into SWVXX, first the system didn’t recognize the ticker then when the help bot got involved I started to buy in and it gave me so many warnings I exited. I liked TD and I like Fidelity. Schwab does not appear to be ready to be a trading platform.
Schwab Money market funds: [https://www.schwab.com/money-market-funds](https://www.schwab.com/money-market-funds) The Schwab default fund for cash is a bank fund (around 0.46%). Schwab no longer "auto sweeps" your cash into a higher paying money market -- you have to do it manually (that is described a the bottom). If you are with Schwab, SNVXX or SWVXX would seem to be good ways to go. If you are at another brokerage, they will have similar funds available. VMFXX at Vanguard, FDRXX at Fidelity, etc. Typically better to but the money market fund they sponsor in case they have trading fees on their competitor's funds.
You have $32k in SWVXX with a current 7-day yield of 5.26%/yr. So assuming the fed doesn't lower or raise rates for a while, you would earn $1,680 - prolly more if you compound, but i'm lazy. Even if you found another alternative with a safe yield of 6%(don't think anything is that high), you would net $1,920. So a grand total of $240 over the course of a year. I really don't think it's make or break money at that point...just leave it in your mmf with Schwab.
With the short term goal that OP has, definitely USFR if they’re looking for something easier to manage than brokered treasury bills/CDs. SWVXX is a prime money market fund, so USFR may have slightly lower risk, and reduced state income tax assuming that OP lives in a state with state income tax. However, for states with no income tax, SWVXX to USFR means only jumping from 5.23% to 5.38% yield. Plus OP obviously must be using Charles Schwab as their brokerage, which means no fractional shares for USFR, so a small amount of those funds are going to still reside in their MMF.
The difference between a HYSA or MMA and this is that the former are pegged to the dollar value of their deposits; for instance, I use Schwab's SWVXX, and when I buy a dollar of it, I always have one share with a variable yield. Any yield-seeking fund, whether BND/X or SPHD/Y, will vary in price as well as yield, so you're taking on additional risk by buying it especially on the short term. A sweep account is generally for money you're "parking" for the short term, which is why you want low volatility. Getting a little bit of interest is just icing.
Was the $400K the result of liquidating an estate? I ask because it's important to understand any potential tax obligation you might have to Uncle Sam. Until you figure out what taxes you may owe it would be safest to hold the funds in either a high yield savings account or a money market fund. Money market funds such as SWVXX are paying 5.25%. Very liquid & you can easily use those funds to initiate other positions like VOO or other ETF's/index funds. Owning rental properties is not a good idea if you don't know what you are doing/don't have experience. It's not as simple as buying a house, sitting back & collecting rent. You have obligations attached to owning that property-property taxes (which in Atlanta I am sure are super high), insurance, repairs, maintenance including a yard company to keep the grass cut and the dreaded call at 3 AM from your tenant when there is a water leak, AC/heater breakdown etc. you name it. You might get a bad tenant who decides not to pay. Then you have a squatter on your hands & the law protects him not you. Just take the time to understand your situation so you make the right decision with your money.
Sure it's easy money. NOT! Let's see. Insurance, property taxes, calls at 3 AM when the heater stops working or AC malfunctions. Acts of god-bad storms, roof damage, fighting with insurance companies to cover a repair. Giving tenants some place to live in the meantime during these events. Dealing with tenants who decide to become squatters. REIT stocks are a much better hands off approach to investing in real estate. Let organizations run by people much smarter than you do the heavy lifting. Find REIT's that have decades long track record of paying dividends and are a good value proposition going forward. That's easier money. But honestly your best bet is to start with a money market fund like a Schwab SWVXX paying 5.26%. Your money is safe, liquid & gives you time to explore your options with index funds, ETF's and maybe some REIT's after you educate yourself. I wouldn't take the advice of many saying you should buy rental properties. That's a recipe for headaches & disaster if you don't know what you are doing.
I would put it into a money market fund if those are the options. I have money in SWVXX, and I believe it to be safe. However, if you're willing to sacrifice a higher savings rate for complete piece of mind, then you should probably go with the Government treasuries fund.
Go with a mix of SWVXX and SNSXX . The rate is equal to or higher than any HYSA and has no direct deposit stipulations or anything. MMFs are perfectly fine for a rainy day fund, you sell and get the money the next day. I was actually able to wire $38k for a car with 0 cash and sold SWVXX to cover the purchase at end of day with no interest charged.
BoA’s internal 7 month CD that you can set up through them is 4.89% interest as of a couple days ago. You could do that with like half of your money in case that helps your rolling balance with them. We get a phat cash back deal thanks to that, usually 5.25% on most things we buy. You could also do something like opening a Schwab brokerage account and making a CD ladder. Other brokerages can do it too but I know schwabs work really well. Otherwise I would lean toward the HYSA. For your actual emergency savings. I love SWVXX and use it to park some extra cash here and there especially in my investment accounts but not for my emergency fund.
You might need to dig through the prospectus; for example this is what it says on the schwab prospectus for SWVXX on of their MF ​ *As a shareholder, you are entitled to your share of the dividends a fund earns. Each fund distributes to its shareholders substantially all of its net investment income. Each fund declares a dividend every* ***business day****, based on its determination of its net investment income.* So my basic understanding is every day the fund generates some interest when bonds are repaid or pay interest say 100k , each day the fund takes out some expenses say $500 (just a example). That day it declares a dividend for the net. Now what happens on weekends ? Probably nothing , I would assume no bonds pay interest or settle on weekends or holidays , if they do they are probably rolled into the next business days interest
You should open a corporate brokerage account. There are daily liquid money market funds that are yielding somewhere in the range of 5% right now. SWVXX or SNOXX are examples at Schwab. If you ever need the cash it can be transferred to your business checking within about 2-3 days.
Those interest rates would be great. My interest accounts SWVXX and SPAXX now pay over 5% and make can make my mortgage payments ( I just reinvest it.) So, it the rates more than triple the income would be awesome. How soon do we start?
> how are you managing this from an income standpoint? I have a cash reserve that covers six months of all expenses parked in SWVXX yielding 5%. I built my reserve over time to reduce anxiety. I recommend adjusting your reserve size to best fit your needs.
Depending on how much cash you’re looking to park, you may be better off just parking it in a HYSA- I use Marcus from Goldman and get 5.4% for 3 months thanks to referral bonus, otherwise it is 4.4% They raise rates pretty in line with other banks and make access pretty easy. Message me if you’d like a referral code for that increased rate. Another great option are money market funds if you don’t want to think about it too much, I like SWVXX- currently at 5.25% but there are many options out there. Otherwise, as others have mentioned, use a broker to create ladders.
Another option -- still subject to taxes, but less work -- is a money fund, which has been making over 5%. Usually brokerages have ones you can trade without fees, like VMFXX (Vanguard), SWVXX (Schwab), SPAXX (Fidelity), etc. If you want a cash position in a brokerage, it's handy.
Pretty much all accounts have compound interest, but it just accumulates in different ways or from different sources. These different sources may effect the way the money is taxed, but if you are in a tax advantaged fund taxes won’t matter much if at all. I’m not a financial advisor, but I would start with something simple like a high yield savings account (downside is many banks have a teaser rate that drops off after a while) or a money market fund through a brokerage. Schwab, Fidelity, and I assume vanguard have money market funds that are yielding about 5-5.5% interest right now. An example would be SWVXX through Schwab. If you feel like investing for retirement, that’s something you should research with your employer or ask a financial advisor. If you are doing it on your own, you can start with an index fund that tracks the S&P500 such as SWPPX, or a target date fund like SWORX 2055 (you can pick whatever year is closest to retirement.
SWVXX Many experienced investors have quietly park proceeds from tech stock gain put in safer heaven. Just look at earning suprises lately. The market reacted negatively worring about this and that. Bulk of the question is 6% the peak or 8% etc.
Nearly everything depends on your definition of "safe". If -your- definition means *absolutely, positively, guaranteed No Loss of Principal* ... stay in cash. It doesn't really matter whose cash, although SWVXX (Schwab) and FZDXX (Fidelity) are offering 5+% Money Mkt rates at the present.
Schwab will allow you to use a Money Market Fund (example SWVXX) as collateral to a cash secured put after you hold the respective MMF for 30 days. And interest earned and reinvested into a Money Market Fund is immediately marginable. If you don't want to wait 30 days, you can buy a short term treasury and write CSPs against it starting the day that you purchase the T-Bill/Note.
T-bill interest for short term has leveled off. High interest fund like SWVXX is anytime. Need over night to get cash. The sweet spot for T-note is about 1 year. It may not serve you unless you want to own one matures each month etc.
I just did a little Googling and apparently on the Schwab side SWVXX doesn’t allow this but SWGXX used to and you’d need to be grandfathered into it to take advantage. Which sucks because I like the flexibility of SPAXX you’re describing.
Because of the current high interest rate environment, a simple solution is to invest in interest bearing cash equivalents - for example a money market mutual fund - see faq in the wiki - [https://www.reddit.com/r/investing/wiki/faq/#wiki\_what\_is\_a\_money\_market\_fund\_and\_how\_safe\_are\_they.3F](https://www.reddit.com/r/investing/wiki/faq/#wiki_what_is_a_money_market_fund_and_how_safe_are_they.3F) At Schwab - this would be something like SWVXX - [https://www.schwab.com/money-market-funds](https://www.schwab.com/money-market-funds) Your other option is to buy t-bills through Schwab. Other appropriate fixed income investments at this time can include investment grade bonds that mature in the timeframe that you need the funds. A simple solution are fixed income target date maturity ETFs from investment managers like Invesco and Blackrock. These are readily available as ETFs that you can just invest through your Schwab account.
Does Schwab automatically assigns to SWVXX money market? Because on Fidelity, as long as you have money on there, you don't have to do anything; it automatically to SPAXX money market. (Passive yield farming!) So if you sell puts/calls, you just earn free yield from cash you get immediately
You did not lose anything. You just took profits at the least oppurtunity time. Always have a plan. That makes exits easier to just happen. If you want to stay out you can place it in something like SWVXX which is just a money market fund making 5.24% interest. Payouts are on the 15th.
Simply from the sounds of it (“low risk”) usually means that the portfolio was largely invested in bond ETF funds, which for the last 2 years or so has been one of the riskiest, slow bleeding things to invest in. This has been one of the most common issues that people come to me with, here’s why. Vanguard’s Total Bond Market Index Fund $BND is down 23% from its peak in 2020, while iShares 20 Plus Year Treasury Bond ETF $TLT is down over 50% from around the same period. To make matters worse, even a target date retirement fund for someone meant to be retired for over 13 years (Example: $AAATX, American Funds 2010 Target Date Retirement Fund) is down over 14.5% from the peak at the start of 2022. Again, this is because of the bonds in the funds. To understand how this works, you need to understand duration risk in bond funds. To save myself a lot of time typing when you can look it up and probably get a better explanation. In short, when interest rates go up, bond funds go down. You can also consider the longer dated funds as leverage for this effect, shorter dated bond funds can be basically flat with more or less no loss of capital (Think $BIL, $SGOV which hold 1-3 month treasuries) or at the extreme opposite end, longer dated funds (Think $TLT and $EDV, $TLT holds 20+ year bonds (Down 2.15% yesterday) and $EDV holds bonds out to 30 years (Down 3.3% yesterday) Okay, that’s out of the way. So you could let us know the tickers you have to get a better idea of where you’re at, but we’ll assume that I’m right and you’re extremely bond fund heavy with a possible target date fund like the one I mentioned above wrapped up in there. What I’m going to say might get some downvotes because it’s technically related to timing the market, but I actually feel that it’s more about macro economics and understanding where we are and you making the best educated decision on your tolerance for risk, which seems like it’s pretty low. The Fed chair, Jerome Powell, says to expect rates to be “Higher for Longer” with others on the board saying that we should expect another rate hike this year. Ray Dailo says to expect the 10 year rates to go over 5%, and JP Morgan CEO Jamie Dimon said that investors should be prepared for 7% interest rates. All of the last 3 statements, if true, would mean that these bond funds would experience more and more losses. However, once something “breaks” from the Fed’s tightening, the rates should technically start to be lowered, meaning the bond funds should start rebounding. There are other factors involved as well, If China and Japan start to sell their Treasury holdings, (they have been, and it’s assumed that Japan actually intervened in the market yesterday) rates will go up with official rate hikes or not. In my opinion, I think we’ll see rates in the 6% range easily and I don’t see us going back to the super low rates that we’re used to. I feel that things are going to be brutal. So now that you have a general overview and a new understanding of what you’re invested in, you can decide to just sell your positions, even though most bond funds are at decade or more lows, and put it into Schwab’s money market account until you decide what to do ($SWVXX which is paying something like 5.2% risk free), or you can simply buy 3-6 month treasuries as often as you can, staggering the maturity dates so you can take advantage of rates if they continue to go up. If rates start falling, you could take advantage of a longer dated treasury, or go back into the funds that you were originally in and take advantage of the positive side of duration risk. Obviously, this will probably mean you will have to pay attention to the markets, but this is probably a good idea anyway if you have a bunch of money in the market -you should know what you’re getting into. I hope this helps, good luck!
That makes sense. That is also how Schwab currently operates. They used to have a cash sweep option into SWGXX, but now everything is held in SchwabCash yielding ~0.4% with the hopes that people don't put in mutual fund trade orders for SWVXX,SNVXX,etc. on their excess cash and my guess is that that is alot of people.
VMRXX is the best across the board for <$1M but you can only buy into it if you have vanguard, SWVXX for td/Schwabb USFR is another really good option that I’ve personally been holding for several years now, which is basically a money market in ETF form, exact same structure except price is not locked at 1.00 so it’s arguably better imo because price moves based on continuously compounding interest so you’re essentially earning daily interest, current yield on it is 5.34% NET. This and/or box spreads are the best way to get the highest risk free yields/repo yields
Whatever you do, stay out of bond funds. Someone mentioned $TLT and that is probably the worst advice that anyone could give right now. Bond ETf’s have duration risk. If rates go up, the bond fund goes down. A common thing that I have been saying to people who ask me is this: the JPMorgan CEO, Jamie Dimon said that “investors need to be prepared for 7% interest rates and most of them aren't.” If we get to 7%, and I think this is a very likely possibility, $TLT and every other bond fund drops, and the bond funds with longer duration like $TLT, $BLV, $EDV, etc. drop more than those with a shorter duration. Think of it as leverage really, longer duration bonds move a lot more with the same increases which just means more volatility. To add to this, the $MOVE index is very high which suggests worse news is coming. Something you probably don’t want at your age. I would suggest doing something that a lot of more seasoned investors are doing, up to even Warren Buffett. As often as you can, buy 3 and 6 month treasuries. This way if rates continue to climb, you aren’t going to be stuck holding something that has low rates. For example, I’m still holding a couple 1-2 Year CDs at 4.5% that I thought was a great opportunity when I bought them, now I’m kicking myself. If rates start to go down, you can dump a little more money into longer duration treasuries or CD’s. At your age, I really think this is the best way. If you don’t want to buy Treasuries or CD’s directly, Money Market funds (Think $SWVXX for Schwab, every broker has their own), or ultra short duration treasury funds ($BIL, $SVOV, etc.) are also very good ideas and all are currently giving over 5% with no loss of capital. These also get adjusted with the rates so you are usually getting the best deal (minus a fee, of course). Please be careful with bond ETF’s, especially with the current uncertainty in the treasury market. I would only start to purchase bond ETF’s when we have clear direction from the fed that they are done raising rates. Good luck with your investments!
The most liquid way would be to throw the money into a high yield savings account (HYSA) with rates ranging from 4 to over 5% if you can find them. A little less liquid would be a money market account. Schwab's $SWVXX is giving 5.24% right now, but it takes a day before you can access the money. You could also use ETF's like $BIL and $SGOV, which are also very liquid, and the cool thing about these is that the value goes up every day, you don't have to wait for a specific dividend date if you dont want to. If you dont need access to the funds immediately, you could also buy 3 month CD's or Treasuries as often as you can. This is still smart for anyone anyway in this current high rate environment. I hope this helps! Good luck!
Anything past about 3.5% is a direct win. > What are the downfalls of switching our investing into a HYSA instead of the mortgage? I'm really going to have to stretch to find a "downfall". * You'll have to declare interest earnings at tax time. Which means the break-even point isn't exactly 2.99%. Then again, if you're using mortgage interest as a tax deduction, paying it off more slowly means the deductions probably offset the taxes on the gains. So if it's not 2.99%, it's *very, very close*. * Uh... if you get more than like a quarter million in the bank and the bank goes out of business, you might be up a creek? FDIC insurance, blah blah. > Is it as simple as switching back to mortgage if HYSA dips below 2.99%? Pretty much, if you're aiming for risk-free... You'd just make a lump sum payment towards your mortgage at that point. Though 2.99% is so low it hurts my soul to let such an opportunity pass you by. Even a boring value fund like VTV has averaged ~7% over the last decade. But you do you! > What are the difficulties of putting money into a HYSA vs taking money out? Uh... Not much that I know of. If it's a brick and mortar bank, you can literally walk in there and walk out with a cashier's check, AFAIK. If not, it's still not going to be hard unless you happened to invest at a bank that went out of business. Another fairly risk-free alternative is a money fund in your brokerage. Money funds tend to keep a share price at exactly $1.00 per share, they throw money in short term money accounts, T Bills, whatever, then pay out the interest as dividends. So if you throw money into a money fund and select the option to reinvest dividends, it works mostly like a savings account within your brokerage account. Most brokerages have at least one that you can trade for free -- SWVXX (Schwab), SPAXX (Fidelity), VMFXX (Vanguard), etc. They tend to make a smidge more than savings accounts -- 5.2 to 5.3% maybe? Usually there's a brief wait for a trade to settle (a day usually?). But being a security, it doesn't have FDIC insurance, but it's highly regulated by the SEC.
You'll have to pay long term capital gains tax so you need to leave some of the $52K gain aside to pay that tax obligation. The amount you pay will also be based on your income tax bracket. I don't know your risk tolerance. I don't necessarily think it would be wise to just throw money into stocks unless you know what your buying and understand the companies you're investing & sectors. My advice would be to take your gains & put them into a money market fund like SWVXX (Schwab's money market). It's very safe paying a 5.24% yield. You can sell that at anytime to pay your tax obligation come tax time. You can also keep your money in that while you look at some other stocks, ETF's or index funds to start initiating positions in. In the meantime start looking at dividend kings and aristocrats. These are long established companies that have been around for decades paying consistent dividends for 25 to 50 years. Companies like KO (coca cola). Mc Donalds, Target-that's been paying a dividend for over 50 years. Index funds & ETF's tracking the S&P 500 or Russel Index-you can't go wrong with those. Start doing research. Good luck.
VMFXX is an excellent MMF. It has an expense ratio of 0.11% vs 0.34% for SWVXX. VMFXX primarily holds securities issued by the U.S. government or its agencies, some of which may be exempt from state income tax. SWVXX primarily holds non-government commercial paper. VMFXX is the default cash/sweep account at Vanguard. If you open a Vanguard account and deposit money, it will go to VMFXX. You don't have to explicitly buy it. Schwab does not have MMFs as the default cash/sweep account. They use bank savings for that, that pay low yield. You would have to explicitly buy a MMF to move deposits to Schwab MMFs. Both are fine institutions. If someone prefers Schwab that's fine.
No offense. Daughter used to work there and I respected what she did as a financial consultant. But I left on my own as she could not even match what I can get elsewhere fee and product wise. I can pay nothing, no commission, no expense getting 5.5% for 1 year US Treasury, or 5% for 10 year(dipped a bit) paying me every 6 months, state tax free. I also can pay 0.35% not 3% buying SWVXX getting 7 Day Yield 5.37%. Use it as a saving account. Want to cash out I sell 24 hour before. Depending on one's tax bracket some say VGSH, VMSXX, VUSXX, FDVV are all attractive.
I'm glad to hear your 12-Delta strategy is working well. SPY can get a little tough when tested delta gets above 50 due to risk of assignment (been there, don't like it, the reason I moved to XSP and SPX). Just keep that in mind. For reference, I'm continuing to trade a SPX 12-Delta strategy, this /ES futures strategy is in addition since it brings additional premium while using less buying power. ​ >Does /ES give you the same tax benefits as $SPX where 60% of profits are taxed as long-term gains? Yes, ES has the same tax benefits as XSP and SPX. Use section 1256 of your tax forms to add your trades. ​ >Does /ES have early assignment? I know that's also a big benefit of $SPX No, ES does not have early assignment risk. ES futures are cash-settled daily, so you need to be aware of what this means (more details below). ​ >Don't futures trade 24 hours a day? How are you managing that? I stay away from 24 hour trading because I worry it would consume my thoughts. No, I don't trade 24/hours a day. I closely watch trades for about one or two hours at market open, then monitor SPX movement throughout the day to see if anything significant is happening. When a ES futures position is tested, then I mechanically roll untested. ES Futures and SPX option rolling mechanics are nearly identical (for me). Some people like the ability to trade after hours, but it's too stressful for me. ​ >You mentioned something about /ES being cash settled daily. Does that mean that you have to keep enough cash in your account to buy the underlying at all times? Cash-settled means any gains/losses incurred from the previous day are added/subtracted from your account, as if you closed, then immediately re-opened the option position daily. In short, you need enough cash to cover the close/reopenen cycle. Afterward, your cash balance will move up/down based on gains or losses from the day before. It's a bit of a mind twist (for me) compared to SPX options which don't realize any gains/losses until the position is closed. When I sell SPX options I immediately put that premium into a high-interest MF (SWVXX - 5%), then sell the MF when the option position is closed. That way I collect MF interest and gains form the option as well. I hope this helps, let me know if you have other questions.
7 day yield is an actual SEC term to compare the yields on money markets since the yield changes each day. You take the average yield over the last 7 days and annualize it. If you were to look at SWVXX’s last 12 month dividend yield you would be looking at something like 3% which is not the yield you would get buying it today. The 7 day yield is pretty close to what yield you would get if you bought it today.
SWVXX Schwab's Value Advantage Money Fund is at 5.23% 7 day yield right now. That's a better option in my opinion & gives you flexibility to access your cash anytime you need it. Depending which brokerage you use they all have their own equivalent fund with a similar rate. Either that or a HYSA.
Absolutely put in saver heaven. I put in a stock brokerage, checking, credit card (earning gift card), atm(used overseas w/ no fees. all bundle together. Fidelity, Schwab etc hopefully with a physical office near you. SWVXX, SNAX are paying decently. Only issue is set up your account. Good luck.
Open a investment with a big brokerage( Fidelity, Schwab, eTrade) buy SWVXX, SNVXX, SPAXX with your mom as beneficiary for now. It is like a high interest saving account. When you need money sell it and it can become cash in their checking account. If you need a credit or debit card ask for one.
You mention SPRXX and SWVXX but they both have a NAV of around 3.7% and a 0.40% expense ratio, so why would I pay a fee for more or less the same return I could get in a HYSA? Plus if I'm already contributing to a 401k and an IRA, why would I want another investment account when I can just have a HYSA?
It depends on what you expect to use this money for. A CD obviously gets you a better rate, but it effectively locks up your cash for a set amount of time. A HYSA might have some minor restrictions like only 10 withdrawals a month, but you have access to all your cash immediately. Other options include investing in a money market fund, which is a special type of mutual fund which holds short term government and corporate bonds. It's pretty liquid, you can sell your shares and have access to your cash within 1-2 business days and they typically have good interest rates but they do fluctuate. For example SWVXX is one run by Charles Schwab and it's recent annualized yield is 5.23%. Another alternative that people are discussing around here are just buying Treasury bills directly from the US Treasury. They are bonds that you can hold until maturity or sell in the secondary market if you need the cash before the maturity date. Recent short term T-bills have a annual return of about 5.5%. There are more options, but you're gonna quickly get into more risky corporate bonds and other types of securities.
Money fund is making like 5.3% these days. Quick money fund intro: * It's like a mutual fund -- you need a brokerage account. * The share price is $1.00 per share. * They put your money, along with everyone elses, into short term money markets, government bonds, and stuff. * They pay interest out as dividends * Their returns will vary as federal interest rates vary. A couple years ago, probably less than 1%. Now, over 5%. * Usually a broker has a preferred fund that they let you trade with no fees. Schwab has SWVXX for instance, Fidelity has SPAXX, Vanguard has VMFXX, whatever. I only have Schwab, so I haven't verified anything other than that myself. * It generally takes a bit of time for the trade to happen and settle, so you'd probably want a bit of cushion to cover the delay. Alternately, just leave it in a HYSA. Or do both -- leave what you think you'll need in the HYSA, move the rest into a brokerage and into a money fund.
SWVXX is a great fund, paying 4.7% last I checked. At Schwab, it trades like a mutual fund and you need cash to buy it. Any cash in cash can be used to buy SWVXX tomorrow. To convert the rest, you need to sell your other assets to raise cash, then the next trading day buy SWVXX. Keep pinging in Schwab to see what fraction of cash is tradeable, some trades and money moves take a few days to “settle”. To get cash from SWVXX to buy another stock, it’s a 2 day process in reverse, sell SWVXX which takes effect after market close, goes into cash, which the next day can be used to buy something or move somewhere.
VUSXX is a government money market fund, but SWVXX is not and therefore it is a bit more risky and Schwab "may impose a fee upon the sale of your shares or may temporarily suspend your ability to sell shares if the Fund's liquidity falls below required minimums because of market conditions or other factors" Go with the government MM.
I went a different route -- not saying it's the right choice, but just to make sure it's on your radar... Money fund in my brokerage account, with dividends reinvested. In case you aren't familiar... * Share price fixed at $1.00 per share. * Money is invested in short term no-risk type stuff, and interest is paid out as dividends. * Dividends buy more shares at $1.00 per share. So functionally, it's behaves a lot like a savings account inside a brokerage account. Insurance will be SIPC instead of FDIC because it's a brokerage. So for me, with Schwab, they have SWVXX which currently pays 5.23%. Fidelity and Vanguard have similar offerings at similar rates. One small downside is, because it's a mutual fund, you do get a day's delay to turn it back into cash. OTOH, it's one less account to manage and transfer funds to/from.
Oh, so I can do the investing activities from *inside* my IRA, now it makes sense! You're the second person to mention the SWVXX, I'll definitely look more into this. Monthly interest is appealing, but I think I understand it will be taxed if I want to move it to my investor checking each month.
The IRA account is an investment account. Pretty much anything you can do in an investment account you can do in the IRA. You should be able to login to that account on Schwab and select Trade and then buy a fund like SWVXX (which is Schwab's money market fund). The account's "holdings" are then updated to list CASH and SWVXX. The interest earned is then paid to the account (goes into the cash portion) and the account balance grows. I believe SWVXX pays the dividends (interest) monthly.