TFLO
iShares Treasury Floating Rate Bond ETF
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Offsetting Previous Losses While Continuing to Invest for the Future
Should I invest in treasury funds if no state income tax?
How to use T Bill ETFs as cash alternative inflation hedges? (SGOV, TFLO, USFR, etc.)
Beating directly holding S&P 500 by selling deep ITM puts?
Can anyone explain the benefit of buying Tbills direct vs just a normal ETF like TFLO?
Parking Cash (Money Markets, Treasury Bills, Bond Funds, ETFs, etc.)
USFR vs TFLO for treasury floating rate note exposure?
How will floating-rate treasury funds (USFR, TFLO) fare when interest rates start to fall?
How to best manage income taxes on realized gains (post tax account)?
Which yield definition should you use when comparing floating rate treasury funds?
What are some safe overnight bonds / ETFs that I can exit any day easily?
If I invest in a treasury like $TFLO for a short term how does the dividend work?
Should I invest money that’s currently sitting in a high-yield savings account into an bond ETF — TFLO currently at 4.47% — or an 11-month CD currently at 5.00%?
Could you buy TFLO on margin, use those margin shares as collateral to write put options on SPY?
Does the current yield on CDs, treasuries and funds like TFLO mean one should exit BND-type ETFs?
Dividends with floating rate bond ETFs (too good to be true?)
Thoughts on ETFs for treasuries like SHV or TFLO? Vs cash?
Mentions
I have a pretty simple portfolio for you. 50% TFLO 25% VOO 23% Gold 2% IBIT
50% TFLO, 25% VOO, 23% Gold, 2% Bitcoin
if that is your emergency fund then I would put it into TFLO or something that will get you a fixed return with very low risk. I wouldn't play index even right now. I've seen the market rollercoaster all over the place.
I just moved a chunk into TFLO for liquidity and trust issues. Near 5% yield with low risk.
If interest rates are lowered this week, are bonds a good position to be in? SGOV, TFLO, etc
Your forgot about FRNs (TFLO) [https://treasurydirect.gov/marketable-securities/floating-rate-notes/](https://treasurydirect.gov/marketable-securities/floating-rate-notes/)
I mostly just "barbell" FRNs (TFLO+ford FRNs) and long treasury bonds (TLT). I am pretty far underwater on the TLT position, I'm glad I started off mostly with FRNs as rates were actually going up.
Again, I mean, I might be dumb. If I was a new investor and I wanted a simple portfolio, I would do a 5050 portfolio (which doesn't seem to be your goal anyway) would be more like 50% TFLO 25% VOO 23% Gold 2% IBIT, and it would cover most every base you'd actually want covered. Maybe swap out VOO for VT if you wanted that extra diversification in equites, and maybe if you want slightly more alpha out of your bonds take on some duration risk from the FRNs, but, that is where I would start. If you need to raise USD just sell some bonds, and then you can hold onto your risk assets longer and thus not lose upside and incur taxes. Unless interest rates are 0% then... just stick with FRNs anyways because interest rates can only go up from there.
I mean, I might be dumb. If I was a new investor and I wanted a simple portfolio, I would do something more like 50% TFLO 25% VOO 23% Gold 2% IBIT, and it would cover most every base you'd actually want covered.
SGOV or TFLO? I currently have my efund in TFLO.
If you believe inflation will get worse, and interest rates will thus follow it up, maybe consider FRNs (like TFLO, for example).
Same thing here except I use TFLO. Same principle though
For a 15-year horizon, I’d lean toward an intermediate-term treasury ETF (like VGIT) — it gives you better yield than short-term funds but less rate risk than long bonds. GOVT & VTG do have more long-duration exposure, so they’ll swing more if rates move. Floating-rate (TFLO, USFR) is great in rising-rate environments, but if rates drop, you’ll wish you locked in longer yields. A simple ladder or a mix of short + intermediate could give you flexibility without overcomplicating it.
When you park money in Treasuries you’re balancing two main risks: interest‑rate risk and reinvestment risk. Short‑maturity or floating‑rate ETFs like TFLO or SGOV have almost no duration, so they’re very stable and will track the Fed funds rate. That makes them useful as cash equivalents or a place to store "dry powder" because price volatility is minimal. The trade‑off is that if rates fall, the yield on those funds will reset lower almost immediately. At the other end are broad Treasury bond ETFs that hold intermediate or long maturities. They will fluctuate more as yields move, but they lock in today’s yields for longer and historically have provided higher total returns over multi‑year periods. A fund like GOVT holds a mix of maturities; VGIT is intermediate‑term; VGIT or a ladder of maturities can be a good match if you have a 10‑ to 15‑year horizon and want a smoother ride than long bonds. Very long‑duration funds are more sensitive to rates and may not be ideal if you plan to shift the money back into equities on a downturn. Floating‑rate Treasury funds (USFR, TFLO) own short‑term securities whose coupons reset with the 13‑week bill rate. They protect against rising rates but don’t give you the term premium you get from holding longer bonds. TIPS (Treasury inflation‑protected securities) are another option if you’re concerned about inflation, though they come with their own quirks. Rather than trying to predict interest rates, many investors choose a core bond fund that matches their time horizon and complements their equity allocation. In a Roth IRA, you also don’t face taxes on bond interest, so holding a taxable bond fund there can make sense. Ultimately the right choice depends on whether you prioritise stability (short duration), income (intermediate duration), or inflation protection. Talking through your broader asset allocation with a financial planner can help you decide which combination of these instruments fits your goals.
I say, same as other guy said, but VOO also with a healthy amount of TFLO, IBIT, and gold, too.
I prefer TFLO (FRNs), the off chance rates really do keep going up.
USFR, TFLO, and SHV might be worth a look
Just invest in intl treasury ETFs like BWX or BWZ for short exposure or short term treasury ETFs like GSY or TFLO for long USD exposure.
I used to keep cash in short term treasury funds like GSY and TFLO. No more. Cash is held in intl treasury funds like BWX or BWZ now. These bond funds beat SPX and NDX over the past 6 months.
Or TFLO. I like TFLO a little more than SGOV right now. I wish Fidelity would do better with the dollar market trades. Also, TFLO is half the price if you’re doing whole share numbers.
If you like treasuries (I do, too, but also live in a state with high income tax), VBIL is a newer option from Vanguard that undercuts SGOV, BIL, and the others on expense ratio and thus is normally going to produce the highest yield. TFLO and USFR come into conversation as well. They invest in floating rate notes, which are a thing the Treasury introduced about a decade ago and in fund form are essentially the same thing as the ultra short term bonds funds, but capture a small premium that allows them to produce higher yields despite higher expense ratios. A lot of people like these; personally I'm not quite sure what their liquidity will look like in times of financial stress. The difference between all of these is going to be pretty minimal though, so it doesn't really matter. This is just if you like to be an optimizer.
Thanks everyone. I get more confused the more I look into this : ) I'd think / you said treasuries are going to have a lower yield than prime funds.? But based on the [https://yieldfinder.app/money\_markets](https://yieldfinder.app/money_markets) site (thanks u/xiongchiamiov !), the highest money market yield is TFLO at 4.32%.... but that's 30 day SEC. I am used to seeing 7 day SEC yields (is 7 day for $1 funds, and 30 day is for ETFs?). Regardless, that's a treasury fund so I'd expect others (prime / non treasury to be higher? But not seeing them?) u/DoinIt4DaShorteezAny reason not to go with that one? Vs. BIL that is at 4.12? And am I right? A whole 'nuther wrinkle is with an ETF, you will have capital gains / losses as you get in / out of it? So you may be getting tax favorable interest but then taxable cap gains / losses depending on when you sell it (just before / after a dividend). ARGHH! too many variables! Another reason to be fully in the market, at least in my mind ; )
For the tax-advantaged account: whatever prime money market has the highest yield. For the taxable account: either a fund holding treasuries to be free from state tax or a fund holding your state's munis to be free from all tax. The muni rates [change frequently](https://www.whitecoatinvestor.com/municipal-money-market-yield-volatility/) so you'll have to try and get an estimate of the average and plug it into [a calculator](https://digital.fidelity.com/prgw/digital/taxyieldcalc/) to see which is better. As far as the treasury funds, the etfs have lower expense ratios than any mutual funds I'm aware of, and thus higher yields. VBIL is probably going to be the highest of treasuries due to having the lowest ER. Then there are TFLO and USFR, which invest in floating rate notes instead and are able to capture a spread premium above t-bills; those have the same tax liability but are a slightly different thing in terms of liquidity. Here's a handy tool from another redditor that tracks the highest yielding funds: https://yieldfinder.app/money_markets Be aware that not all the ones in this list are invested in tax-exempt assets, so you'll need to check that.
Given stock valuations are stretched, while the new Trump Republican big beautiful bill is set to explode deficits and debt, which will put pressure on Treasury bond yields, pick a treasury bond ETF like TFLO and SGOV, to take monthly dividends, similar to a high yield savings. They're currently yielding around 4.5% annually.
And it's okay to sit in cash for a while. Or TFLO. Or whatever.
They are literally the same thing. https://totalrealreturns.com/s/TFLO,SGOV?start=2014-10-05
$100 per day on a $650k account is about 4% annualized. Just buy TFLO and go golfing.
SGOV is perfectly fine. There are a few other options that give slightly better yields (VBIL is the same thing but lower expense, TFLO and USFR invest in floating rate notes which are a different type of investment, and then if you don't care about the state income tax exemption prime money market funds can return a little higher), but it's up to you if you care.
SGOV is perfectly fine. There are a few other options that give slightly better yields (VBIL is the same thing but lower expense, TFLO and USFR invest in floating rate notes which are a different type of investment, and then if you don't care about the state income tax exemption prime money market funds can return a little higher), but it's up to you if you care.
You can read the "breaking the buck" section here: https://en.wikipedia.org/wiki/Money_market_fund We normally have low six figures in VBIL or similar funds in case that helps. I'm just some person, and I can't provide any guarantees, but as I've looked into it I am satisfied with the risk of the treasury funds. I'm _not_ quite as sure about the floating rate notes (TFLO and USFR) because we haven't seen how their liquidity holds up in weird market conditions, so I don't use those even though they're broadly considered extremely safe as well; that gives you an idea how conservative I am with risk. In my opinion: they're essentially the same in risk. Really it comes down to whether you're ok with the hassle of dealing with a brokerage versus a bank account.
Good question. SGOV, TFLO good ETF’s too
VBIL is the same stuff but even cheaper. You can also get into floating rate notes with USFR and TFLO and grab a small spread premium, but FRNs are a newer thing and it's not totally sure how liquidity will work in the event of major market movements, so I'm personally fine giving up that premium.
GSY and TFLO have better returns.
Sure. But the counter point to that the Trump admin has changed tariff positions 50+ times since January, 30% blanket tariffs on China, Mexica, and Canada are still in place and going to cause inflation, consumer sentiment is still shit, and the general instability of the US economic policy can cause capital depreciation that may not be worth it to you over the next 6-10 months. The market is drifting upwards but we already had negative Q1 GDP growth and companies are suspending guidance. If that risk is tolerable to you, open a position. I think long term it's a really nice ETF to hold, but it may be just as smart a play to buy SGOV or another bond ETF like TFLO and wait for more stability in the short term before you start deploying your cash holdings. You can use those bond ETF's to accumulate 4+ percent monthly dividends while preserving your capital if you think the market is just too turbulent right now rather than assuming an ETF that tracks the DOW is an effective bond proxy.
Your broker will have a mutual fund, and here are some ticker options if you prefer an etf: VBIL, SGOV, TFLO, USFR. There are more, but those are all cheap and invested in treasuries.
is that what they call a cash "sweep". I use Schwab and i frequently read complaints that Schwab doesn't (or at least, didn't) sweep cash. I use TFLO for my savings, and I keep my cash in Schwab's basic money market fund (SWVXX) which is currently at about 4.1%. I know if you have $1MM or more there are other funds you can put your cash in that pay more. The thing I don't love about the money market funds is that I have to "sell" them, and let the funds settle before I can invest it / buy a stock. though, perhaps that's good because it reduces the amount of impulse decisions i can make. lol
There are a bunch of other options, too. TFLO is the same thing as USFR but for some reason no one talks about it, VBIL is a new Vanguard version of SGOV but cheaper. Look through some options: https://yieldfinder.app/money_markets Depending on your state taxes, a lower yield muni fund might net you more, so that's worth checking too: https://digital.fidelity.com/prgw/digital/taxyieldcalc/
GSY or TFLO will get better returns.
Nothing wrong with holding a bit of SPY and GSY or TFLO.
What’s up with floating rate notes? The yield is better than treasuries right now, probably because interest rates are still higher. I’m thinking about putting most of my savings in FLOT and TFLO while i‘m saving for a house and then shifting to SGOV if interest rates are cut. Is this a good strategy?
Since 2016, a port of: - 80% TFLO (short term treasuries) - 10% GBTC - 10% GLD Using rebalance bands. Beats holding 100% SPY and has a significantly lower drawdown.
Since 2016, a port of: - 80% TFLO (short term treasuries) - 10% GBTC - 10% GLD Using rebalance bands. Beats holding 100% SPY and has a significantly lower drawdown.
I would move to VUSXX, TFLO, USRF. ER is low and you can't beat the simplicity. Also, state tax exempt vs a CD, of course that only matters if in a state that levies a state tax.
No, there is risk with all stocks and if you plan to withdraw short-term, there’s always a risk you have lost money on your investment. Dividend stocks also are not better than just investing in an index fund. For short term cash, put it in SGOV or TFLO. It has a better yield than a HYSA, and the dividends are exempt from state taxes.
I use etf money markets primarily and they allow this. VBIL, SGOV, USFR, TFLO, those sorts. They take longer to settle into cash for transferring out to my bank though.
If you haven't bought QQQ yet, put off this strategy. 1. Start by selling cash‑secured puts. -Pick an ETF you actually want to own. QQQ is fine—lots of trading volume means fair prices. -When you sell a put, you’re saying, “If QQQ falls to this price, I’ll buy 100 shares.” -If QQQ stays above that price, the option just expires and you keep the premium (your “rent” money). -If QQQ drops below it, you buy the shares—effectively getting them at a discount. Why do this first? You’re easing into the market at lower prices instead of dumping all your cash in at once. And selling covered calls should be something you do when you think the market is too hot and likely to go down soon, but you still want to hold on to your shares. It's just not the move to lead with. 2. At some point the market will decline and you will be forced to purchase the shares. Now is when you should decide if you want steady income or full upside. Income path: -Sell covered calls. This will severely hinder your gains if the market jumps up. And if you try to get in again at a higher price, you set yourself up for larger losses. -You collect another premium, but if QQQ jumps a lot you’ll have to sell early and miss some gains. Growth path: -Skip covered calls and just hold the shares. You keep all the upside but lose the extra weekly “rent.” 3. Understand the risk behind selling options. When you sell puts or calls, you’re basically betting that QQQ won’t move too far, too fast. -Most weeks you earn small premiums. -Every once in a while, a big move can cost you way more than those small wins—so size your trades safely. 4. Keep extra cash working for you. While waiting for puts to be assigned, park spare cash in short‑term Treasury ETFs (ticker SGOV, TFLO, etc.). They pay ~4‑5 % and are easy to sell if you need money for an assignment. 5. Optional but requires daily babysitting: the short strangle (sell one put + sell one call on the same ETF) Collect two premiums instead of one so your “buffer” against price moves is larger. Hidden workload: You must log in every trading day, sometimes twice, because assignment can strike at any time, especially if the option is deep in‑the‑money or right before a dividend. Usually you won't get assigned but when you do every second counts. Plan ahead! What to do if one side gets assigned: Keep the shares you had to buy (put assignment) and switch to selling covered calls for extra income. Flip the shares—sell them immediately—then sell a new put to restart the cycle at a lower price. What to do if the other side gets assigned Let the sale stand (call assignment) and wait in cash if you think prices will drop. Re‑buy the shares right away, then sell a new call to stay in the income game. (Advanced traders mix in delays or wider strikes, but those are just variations on the four core choices above.) Key reminders Have cash or shares ready so an assignment never triggers a margin call. Set alerts (broker app, email, texts) for when either option goes deep in‑the‑money. Know which playbook you’ll use before assignment happens. Do not allow yourself to have a deer‑in‑headlights moment. If daily check‑ins sound like a chore, stick with single puts (to enter) and covered calls (to earn extra while capping upside) until you’re 100 % comfortable.
On an investing subreddit something with lower taxes and higher yield is as close to objectively better as you can get. Although I'd recommend a floating rate treasury fund like TFLO/USFR.
Everyone always forgets floating rate treasuries exist as well, TFLO/USFR have almost zero duration risk and will pay more if rates rise.
I buy based on whether or not I can determine what kind of risk I'm facing. I'm fine with risk of losses, but I have to be able to make an informed decision about what kind of risk of loss I face. I can't do that right now where Trump can change his mind every other day and his economic policies are creating an environment that is a) likely going to cause a recession, and b) makes it impossible for businesses to plan even the next 90 days of investment/capex. So right now, I'm noy buying. I'll buy back in when I can see an actual plan and stability where things aren't flip flopping every 48 hours, even if the plan is stupid. In the meantime, I'm sitting on cash and bond ETFs like SGOV and TFLO. I'm also pulling back on my contributions to my 401(k) and going to rebalance my budget towards servicing debt like my mortgage and some other loans I have out rather than retirement because the return will be better in the long run/free up my finances.
I’m not super experienced, but I sold everything for TFLO Feb 2 (was pretty much just VOO and TFLO before). Didn’t think to try to short it, but I when I saw the markets up 2-3% this morning, and knowing the extra tariff on China was coming, I bought SQQQ, and that went up like 15%. Probably will sell it first thing at 9:30
lol, I bought $1,000 of SQQQ when the markets were up this morning. Made $150 today. Everything else in my portfolio has been TFLO since the beginning of February when the talk of tariffs started
same. I'm not even close to retirement. got plenty of savings in TFLO and CDs. have additional funds in the market that I don't need anytime soon. I'd like to see some chaos.
Yup, pretty much. Make a plan. I have been pushing a simple 5050 portfolio 2%BTC 18%gold 30%VOO 20%TLT 30% TFLO
Over the past three months I've ported half of everything into SGOV and TFLO, which means he'll default on US debt next.
SGOV TFLO JAAA HYSA and collect cash for good entry points. TBills and bonds.
Its an ETF that invests in 0-3 month treasury bonds. You get stability of bonds with a dividend payout and the liquidity of an equity where you can sell at any time rather than waiting for maturity. https://www.ishares.com/us/products/314116/ishares-core-sp-500-etf There are other bond ETF's like TFLO which tracks treasury floating rate bonds. https://www.ishares.com/us/products/260652/ishares-treasury-floating-rate-bond-etf
Depends on your time horizon. Realistically if you want a car soon, you probably should have been in stocks to start with, but it's too late for that. Broadly, recovery from recessions can take as long as 5-10 years, so money you plan to need before then should be at least partly in bonds in case a downturn hits. Given you want to buy a car soon, I think it's reasonable to pull some or all of it out to safer investments like bonds (TFLO, for example, which pays out monthly), a high yield savings account, or CD at your bank. If this is your retirement money, leave it in. You are absolutely better off in the long term by riding out whatever downturn may or may not happen.
With a 1.99% interest rate the best move is really to keep the money in a safe investment, like a high yield savings account or something like SGOV/TFLO, then make the minimum loan payments. What are you planning to do when you leave the country? Are you coming back? How soon? If it’s an extended time, you probably should pay off the loan and sell the car right before you move.
About the same. 401k and IRA are 100% equities and will ride it out until I’m in my 50s. My brokerage is about 75% of my liquid assets and is 10% TFLO 90% equities. The TFLO is simply waiting on a buying opportunity and is as much as I’m willing to have sidelined. The other 25% is in HYSA as my 6 month emergency fund with some in my checking. That never gets invested so it doesn’t count.
Is this like TFLO? I am invested in that a little bit.
I've been in bond funds (SGOV and TFLO) the last month, with an annual yield of just over 5% with dividends paid monthly. The market was overvalued anyway, and now we have the Trump admin trying to sabotage the US economy.
Anyone know what’s going on with TFLO?
I've been tinkering with what a 50/50 portfolio should look like, and it shakes out currently like this: 1% IBIT 9%IAU 40%VOO 10%TLT 10%IEF 30%TFLO. Momentum investing for risk assets (the S&P500 is allocated based upon market cap, gold and bitcoin have market caps you can look up), bar belling long bond risk for risk free assets (the risk being interest rates going up). You could swap out the intermediate or long treasuries with TIPS if you prefer.
1% IBIT 9%IAU 40%VOO 10%TLT 10%IEF 30%TFLO as something that would be a near ideal 50/50 portfolio in my opinion. I can explain the logic behind this if you like, it's pretty simple actually. The S&P500 is in order of market cap, gold and bitcoin can be included because you can also look up their market cap, and compare it with the holding% and market cap of the companies in VOO to figure out how much to allocate to each. The treasuries half has a healthy amount of FRNs to offset the duration risk of long and intermediate treasuries ( I suppose you could swap these out for long or intermediate TIPS if you prefer) in case rates go up, because the risk in bonds is rates going up so it sort of [barbells](https://www.investopedia.com/articles/investing/013114/barbell-investment-strategy.asp) the long bonds (which really are quite risky). So momentum investing for risk the risk side, barbelling long bond risk for the risk free side. [https://en.wikipedia.org/wiki/Efficient\_frontier](https://en.wikipedia.org/wiki/Efficient_frontier)
MMF or short-term t-bill etf like USFR or TFLO
1% IBIT 9%gold 40%VOO 10%TLT 10%IEF 30%TFLO would be an ideal 50/50 portfolio in my opinion.
FDLXX is slightly more tax efficient and USFR/TFLO a littler more than that plus they may have a slightly higher yield also.
MMF, HYSA, or short-term treasury ETFs like USFR/TFLO is the only answer here… FXAIX for a one month horizon is not smart. Stocks are highly volatile and should be reserved for long-term strategies.
Makes sense. Any particular reason you chose it over TFLO. Only 0.06% higher rate now but ...
I'm obviously going to do my own research but just as a starting point: I buy sgov today Market plummets at some point in 0-6 months I sell immediately Is this roughly normal behaviour? Is there any reason to wait until the distribution date? Why SGOV over TFLO or USFR?
Honestly, at at her age with her time horizon, it's gambling more than investing if she dumps money into the market. Fixed income yields are still pretty good right now, so she's missing out if she's not taking advantage of that. She could do something like a CD ladder, or buy shares of a floating rate treasury ETF like TFLO. Even just keeping her money in a money market fund would be better than nothing. Lots of low-risk options still available to squeeze some extra income out of what she already has. But imagine a scenario where she's gone and put a large percentage of her savings into an S&P 500 index fund, and we have a crash where it loses half it's value. Then she has an emergency and needs the funds? She just doesn't have the time for big gains
I would start by putting it into a money market mutual fund or TFLO/SGOV, and then decide on a more permanent strategy
Eli5 the difference for floating rate treasuries likes USFR/TFLO vs SGOV?
SGOV would be a good option for a falling rate environment, but the difference isn’t huge. Personally I just use floating rate treasuries like USFR and TFLO rather than try and predict interest risk. These funds are also more state tax advantaged than SPAXX which is a nice bonus.
I haven’t tried poppy bank but I’ve tried some equally sketchy banks trying to chase the best rates and the experience wasn’t worth it. I never felt like I was going to lose my money, but I never felt safe either. And what did I gain for my trouble? TFLO is paying 5% right now so holding $10K in poppy which pays you an additional 0.5% for 90 days gets you a whopping $12
I used to chase the best HYSA and some sketchy banks, and it was not worth it. The interface was slow and clunky, and the transfers took FOREVER. Sometimes I’d drop a few grand in there and it would be lost in the ether for about a week before it showed up. I never quite felt like I was going to lose my money, but I never felt quite safe either. Now I’m in USFR or TFLO which are paying 5% and are basically more liquid than a sketchy HYSA, seeing as I can sell it and transfer it and the funds will probably settle faster than poppy bank. And how much money am I really losing? Poppy pays 0.5% more for 90 days. Assuming you have $10 grand in there, that’s a whopping 12 bucks
Look into USFR or TFLO for your housing fund. I use Fidelity CMA. My strategy is to keep my checking in SPAXX and my emergency fund in FDRXX. I’ll use USFR for any short/mid term cash savings. Don’t see much of a point in HYSAs they earn less and are less tax advantaged than the strategy I just listed out. On top of that they are usually less liquid and flexible outside of accounts like Wealthfront that double as a checking acct.
high yeild is going to normally have lower credit quality bonds so that is why you are getting higher yields. Something like HYG , has only BB and below. JNK is roughly the same. SGOV/USFR/TFLO are all Treasury notes/bills I would feel much more comfortable with them if memory is correct they are all AA and above, they are all state tax exempt. Also what are these bonds supposed to be used for e-fund, cash holdings, goal for something else , etc?
I use SGOV, USFR, TFLO instead of HYSA primary because of two things: 1. Avoid California State tax . 2. Ability to use the short-term capital gains instead of the dividends when it is beneficial for taxes.
For now, you can put it in TFLO, treasury bonds highly liquid and pays that yield.
Just wondering, everyone mentions USFR. Is it notably better than TFLO?
I'm an index fund/ETF investor with a 70/30 world portfolio (MSCI/EM). In addition, I hold some amount of $ in a money market fund, SPAXX to be specific. I recently found out that I'm paying my marginal income tax rate on the generated dividends in the US. I realize I could move to something like TFLO, which could be more tax efficient because a portion (99%?) is state-tax exempt, but wonder if there is still anything better I could do? For example, if I accept a little bit more risk, could I move to an ETF that holds slightly longer term bonds (e.g., 1+ year bonds), which would possibly fall under long-term capital gains? Any ideas for products with a similar risk profile to SPAXX but that would be treated in a more tax-advantageous way (ideally, as long term capital gains)? I fully expect to hold some portion of this at least 1 year and I do not need the immediately available dividends this pays out.
So any cash not being invested gets RH’s 5% interest income that will follow the federal funds rate as it moves up or down. However, RH gold gives you $1k of margin interest free. So you could just put your money into a short term bond fund like SGOV or TFLO and use that $1k margin to pump into that same fund; instead of $10k collecting the TFLO/SGOV 5.3% interest rate, you would have $11k collecting that instead. That amount currently pays for RH gold for me at these interest rates. Now, interest rates will probably go down a little bit from here, likely starting in September, but I can’t imagine we go below 3.5% overall (unless we have a recession on our hands).
Can you elaborate on the TFLO?
With RH gold, they’ll match 3% to your IRA. So maxing it out currently that’s $210 extra. You also get $1k free margin which I use to buy TFLO which currently covers RH gold for me. The 1% brokerage match, they pay me 1% for everything I contribute to my brokerage (paid out over 2 years). I’m currently saving for a down payment (2-3 years out), so this is a no-brainer move for me.
It’s not FDIC insured but sticking it into something like TFLO will be mostly state and local tax free and is making above 5% right now… will drop to 5 soon with rate cut. Money markets can be good too.
Not going to do much better then 5% USFR, TFLO, SGOV, BIL are ETFs that invest in short term Treasuries. Currently yielding a little more then 5% and are generally state tax free.
TFLO contains FRNs. And if rates go down, the price of bonds you want to sell would go up, actually.
Well, the off chance rates go up for the next 40 years like some people think, couldn't hurt to get some TFLO.
ignore the expense ratios, they don't matter as they are already factored in before the number that does matter which is the 30day SEC yield, TFLO/USFR are usually better in a stable or rising fed funds rate environment, both paying 5.32% today but SGOV better in a falling fed funds rate as it takes longer to adjust down or up paying 5.25% today.
TFLO and USFR are ultra short term and essentially the same. SGOV is a little longer term, but still pretty short term where you won't see much of a difference in price due to changes in interest rates. Idk, just pick one and be done with it. SGOV has a lower expense ratio so maybe that one.
TFLO and USFR both invest in floating rate notes, which are 2 year notes, but the coupon rate adjusts every week based on the results of the 13 week treasury auction. It can be both an advantage or a disadvantage depending on whether rates are rising or falling. When rates were being raised, people liked them because their yields increased faster than SGOV. If rates fall though, their yield may drop faster than SGOV. Probably not a lot of difference though in practical terms. I'd choose the one with the lowest cost.
I just started purchasing this. It looks great to me - TFLO has the advantage of the FRNs (higher yield on short term bills) but it is also liquid. The downside is that you are paying 0.15% to hold it (compared to the FRN) but a small price to pay for the liquidity. So when interest rates are cut, you can get out. I've laddered my FRNs from 4/2025 through 10/2025, so I might get hurt on the last one since there does not appear to be much of a market for the FRNs. With the TFLO, you can just sell it before rates drop too much. To answer your last question, assuming you are with a discount broker (no commissions) and with a state that has an income tax, the TFLO is a great place to park short term cash, along with SHV and treasury bills.
Depending on your broker, this just gets tallied into total gains and losses, total wash sales, and total dividends. You fill in two boxes on one tax form and one box on another, basically minimal effort if you were already filing a 1099B and 1099-DIV. I've used SGOV/USFR/TFLO this way for several years now with both Vanguard and Fidelity.
I always preferred USFR or TFLO, little bit higher returns I think.
TFLO for the off change interest rates keep going up for the next 40 years like some people are saying.