USFR
WisdomTree Floating Rate Treasury Fund
Mentions (24Hr)
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Reddit Posts
Seeking Suggestions for Parents After Disappointing Financial Advisor Experience
Offsetting Previous Losses While Continuing to Invest for the Future
Why does USFR have such a higher yield than all other money market funds?
Should I invest in treasury funds if no state income tax?
Are SGOV or USFR still viable short term investing options for growing down payment?
5K Daily Gain on AMD, IWM, META, PLTR, and QQQ
What are today's sentiments towards the market? How are we feeling
How to use T Bill ETFs as cash alternative inflation hedges? (SGOV, TFLO, USFR, etc.)
Moving 200K from HYSA to treasury ETF. Confusion regarding USFR vs BIL
Parking Cash (Money Markets, Treasury Bills, Bond Funds, ETFs, etc.)
Short term US Treasuries: T-Bills vs ETFs vs Floating Rates (USFR)?
Can buying/selling SGOV and USFR trigger a wash sale?
USFR vs TFLO for treasury floating rate note exposure?
House downpayment is sitting in Robinhood cash sweep (4.65%), is USFR a better option?
How will floating-rate treasury funds (USFR, TFLO) fare when interest rates start to fall?
How dumb is this strategy: say you own 100% in USFR, use ~15% margin to sell mildly OTM puts?
VMSXX has now temporarily surpassed all MMFs for higher federal tax brackets.
Will Treasury ETFs Crash in Case of a Default? - Specifically Floating Rate Notes?
How to best manage income taxes on realized gains (post tax account)?
Are returns from treasury ETFs like SGOV and USFR state tax exempt just like regular treasuries ?
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?
5 Great Fixed-Income Funds to Buy for 2023.What do you think?
Dividends with floating rate bond ETFs (too good to be true?)
Consider a Floating Rate Treasury ETF for your Cash - Almost Zero Duration Risk - Pays More Than Savings
Mentions
Note USFR’s effective duration is .02 years not .2; so very short
Ah thank you! When we say effective duration of 0.1 or 0.2 years what does that mean exactly, what is an effective duration? Thank you for linking me to this boggle heads write up, that is super useful! I started reading though it and it sound like a floating rate treasury is super useful and he recommends getting one for sure, I’m still learning about this. Yea the reason I ask about short term ETF’s is to see if there are others comparable with varying returns. Like for instance there are diffeent 7 days MMF with varying returns and I wasn’t sure if it would be the case with short term ETFs like SGOV. Basically I wanted to know which list SGOV came from. But if they are all similar, I can certainly get SGOV and one of the floating treasuries like USFR and even include SWVXX as the MMF. I need to write all this down! It’s starting to sound like alphabet soup. If you don’t mind me messaging you to keep in touch that be great!
> Super helpful info! MMFs yielding less than SWVXX, isn’t SWVXX already a MMF? Yes SWVXX is a MMF. Different MMF's have different yields. > It’s specifically a 7 day yield fund. I don't know what you mean by this. '7 day yield' is how the yield is reported on MMFs. Its what annualized return of the fund over the previous 7 days. You don't get that yield every 7 days. >When you say 0-3 month, does that mean it matures in 3 months or expires in 3 months? When I looked up SGOV, it had no maturity from my understanding, but I could totally be wrong! SGOV doesn't mature. That Treasuries it holds matures and the proceeds are then invested in new Treasuries. Its essentially a bond ladder with an effective duration of 0.1 years. >What the difference between Floating Rate Treasuries and Government bonds? A floating rate treasury is a type of Government Bond. Its a longer term bond but the interest rate floats so it doesn't have the same interest rate risk as longer term treasuries. USFR's effective duration is 0.2 years. >I also, tried looking up where to find a list of short term government bonds on Shwab but couldn’t find a list? Their customer service didn’t know either so i’m wondering how do we find the different options out there other than SGOV that does something similar to keep funds liquid with a return. Not sure I follow, are you looking for other short term bond ETFs? How many variations of Vanilla ice cream do you need? Here are some I'm aware of: SGOV, BIL, VBIL, TBIL, JPST, ICSH, VUSB, USFR, TFLO. The only ones I have any first hand experience with is SGOV, USFR and TFLO Here is an oldie but goodie: [https://www.reddit.com/r/Bogleheads/comments/11prp0b/hysa\_mmf\_cds\_tbills\_searching\_for\_the\_best\_return/?utm\_source=share&utm\_medium=web3x&utm\_name=web3xcss&utm\_term=1&utm\_content=share\_button](https://www.reddit.com/r/Bogleheads/comments/11prp0b/hysa_mmf_cds_tbills_searching_for_the_best_return/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button)
When I last checked Schwab's Treasury MMFs were yielding less than SWVXX. I'd save state taxes with SNSXX but the tax savings didn't make up the yield difference. SGOV and USFR are ETFs that invest in ultra short term government bonds. SGOV invests in 0-3 month Treasury Bonds and USFR invests in Floating Rate US Treasuries. There are several other ETFs that invest in ultra short term Gov't bonds that are equivalent. I actually have a bit of SWVXX but most of my uninvested cash is in USFR. I haven't checked recently but when I last checked it was yielding slightly more then SWVXX and is state income tax free. The key is they invest in ultra short term securities so you don't have the same interest rate risk you have when investing in longer term bonds. A Money Market Fund keeps a constant share price of $1, orders execute every night and you get paid interest monthly. A Treasury ETF trades like a stock. It has the same limitations of other ETFs at Schwab, no Fractional shares. USFR's share price hovers around $50 and SGOV around $100 so if your dealing with small amounts of cash that can be a pain. If you look at a price graph you'll see they make a nice sawtooth pattern. That's because they slowly increase in price throughout the month as they accumulate interest then drop when the interest is distributed. All of these are fine options and are easy to switch between. You mentioned iBonds and TIPS. You can only buy iBonds directly at Treasury Direct. You can buy TIPS at Schwab, either directly, via a Mutual Fund (SWRSX), or via numerous ETFs (SCHP, TIP, etc). Schwab has other options for cash as well, T-Bills, CDs, etc.... I dabbled with T-Bills for a bit but it was more effort then it was worth and just started buying the ETFs instead. The convenience was worth the minor cost to me.
Interesting! If you are using Schwab, I am on the research tab, under Money Market Funds and I only see the SWVXX under “Prime Money Funds”, where is the USFR and SGOV located? I clicked on ETFs and typed SGOV, and it says it’s an “ultrashort bond”, Does that mean it’s a bond or ETF? Is this like an iBond or TIPS? Do you get a return on these like the Money Market Funds? Is there a reason you prefer to buy the short term treasury ETFs in addition to the SWVXX? I am curious why you don’t choose Government and Trrasury Money Funds like SNVXX, SNOXX, SNSXX, or the money market ETF like SGVT? All of these have a 7 day yield.
Yes, in my taxable brokerage I use both SWVXX and short term treasury ETFs like USFR and SGOV. I don’t use uninvested money in my IRAs but if I did I’d certainly want it gaining something. You can usually put in the order to sell the mutual fund or ETF the same time you put in the buy order for your investment and everything should settle at the same time. You might need to enable margin in your account but I’m not sure.
You can keep cash equivalents in your Schwab brokerage and get equal or better interest than a HYSA. Either buy a money market fund like SWVXX or a short term treasury ETF like SGOV or USFR.
> Since it’s not SGOV/USFR/TFLO, you will have to pay state and local taxes on the interest Schwab has SNSXX which only buys T Bills etc, no agency paper or repos or anything like that. I haven't yet received a 1099 for it but I assume the year end info will show that 99% (more or less) will be free of state taxes. https://www.schwabassetmanagement.com/products/snsxx
Check your broker and see if they have a money market mutual fund where you can park cash (both Schwab and Fidelity do this), that can be used as collateral/cash equity for when you sell covered puts (cash secured puts). You can also set this to be marginable (default). Caveats are: * Since they are mutual funds, they trade at exactly 4:00p EST, and you won’t get charged margin interest on other trades if you’ve put in the order before 3:55p EST to cover the margin * Since it’s not SGOV/USFR/TFLO, you will have to pay state and local taxes on the interest * If set as marginable, anything else you sell won’t settle into cash, and will get tied up as collateral unless you reach out to the margins team and get it freed up
shoutout to USFR, cash gang, the only thing green in my port today. Plus it's forking over an interest payment tomorrow which I can use to buy the blood
up 0.12% and I reinvested the dividends I got from voo and vt. Soon USFR will print off some to deleverage my margin loan
Cash in MMF. Tbills SGOV ETF (ultra short Tbills, fixed rate). USFR (also ultra short Tbills like SGOV but with floating rates, so good if you worry about rising rates).
I don’t know what the apy is for ally high yield savings but personally I put cash in BOXX or USFR the yield is around 5%. If you’re looking for more return and a bit more risk VOO, VXUS, QQQM, SPYM are all popular. These are a low cost index funds that track the overall market. (S&P500, International, and the Nasdaq100)
There are times where evaluations are high and it’s possible that cash out performs equities for a decade. Strategic rebalancing, not market timing, can enhance returns. For example, I use 33% USFR ibit and vt. If market goes down I force target allocation with up to 10% margin and future income. If market goes up, I pay off debt or load up on USFR to bring balance back to the force. Portfolio income goes to debt first and then VT. I have this all printed off as rules to follow.
Bonds bad gold better look at a 60/40 stock bond portfolio. It’s not a good look. My view is diversification is good if the instruments are not very correlated and both perform well. Just quick glancing at charts VXUS looks good and gives diversification into international stocks. VOO VXUS Gold I think would a be pretty solid long term portfolio. Cash in USFR or BOXX. NFA
Treasury Bill ETFs. Stable as fuck, good dividend, doesn't grow much though. My recommendations: BIL VBIL XONE SCHO WEEK USFR UTEN
Yes - that's a good reason to use a brokerage account instead of a HYSA. Also - if you have state taxes - interest from treasuries - interest from funds like USFR are generally state and local tax exempt - whereas interest from a HYSA is generally not state tax exempt. And depending on your tax status - even muni money market funds may generate a higher yield on a post-tax basis.
I Don’t see any significant value /connection with my HYSA. I have an account at a brick and mortar bank also , enough to cover recurring bills and a buffer. No big purchase planned. $ is just parked in a safe account earning some interest. My thought is that USFR or GSST would provide a slight bump and also make it easy to invest if I see an investment opportunity.
Depends what the market will do; if it continues to slip, I'm using my USFR as collateral to margin into the dip until balance is restored to the port. If it goes sideways or up, then I wait for dividends to pay off margin debt or buy more stonks
I like USFR as the collateralized asset class I use for margin and leverage into other securities
Diversify. Majority of your portfolio can be in interest bearing cash right now, at a relatively respectable 4.5ish%. If AI is going to continue to be as explosive as the bulls say, then you can allocate a relatively small portion of your portfolio to it to more than make up for the difference. On the flip side, there’s gold, gold miners, crypto, energy, international, long and short bonds, etc that all have different investment theses. High beta? Low percentage. A great strategy for someone humble who just wants confidence in their future. I beat market returns by 10% or so this year in crypto and gold/silver miners with an allocation, and that includes the 60-70% of my holdings that were in USFR the whole time.
Emergency fund in physical gold… Then I do 33% IBIT, VT, and USFR… Then I follow four rules… When I get paid, I buy whatever asset is lagging. If VT lags behind my short-term treasuries, then I sell short-term treasuries until VT equals US FR if the portfolio doubles in terms of dollars then I rebalance. all portfolio income goes into VT.
if they're scared, they could at least do short term treasury fund USFR/BIL 85%, sprinkle in 5% GLD and 10% VT. No fancy words, if they don't understand, it'll freak them out. Short term treasuries backed by the united states government, Gold spot price, and a global equity fund that owns basically every business in the entire globe.
I have an eTrade Roth IRA, which does not do fractional shares except for dividend reinvestment. Most of my money is in VOO and VUG. I don't have enough left over to get any more of those, so I put as much of the leftover as I could into USFR so that it's at least not doing nothing. Now I have less than 25 in purchasing power. How can I make those last dollars do some work? I understand that's a paltry amount, I just wanna get as much as I can working for me. If the answer is "seriously bro don't worry about 25 bucks," then I'd understand.
I personally use up to 10% margin during bear markets only. I balance the fund with short term treasuries USFR for ballast and protection if we shit the bed past my max margin cap.
I've been waiting to do this, you activated my trap card! Rule #2: "When USFR > VT, rebalance by moving 33% of the difference (USFR − VT) into VT and the same amount into Corn.”
That's a poor decision and will cost you far more than 6k long term. If you really want to be risk averse, put like 30% into a bond ETF like USFR, that way you'll get a higher yield than any hysa and you don't have to pay state/local taxes on that yield. Then the rest into low cost index etf like VOO. Seriously having the stability of a US military job for presumably a couple years and the maturity to actually put money into savings are two huge advantages, not having the intelligence to do it right would be tragic.
This .SGOV and USFR gains are almost state tax exempt.
sorry to add one more on you list . USFR. Please do check before making a decision. https://www.reddit.com/r/Bogleheads/s/eabNqI99Mz
You're over thinking it. A Treasury ETF like VBIL, SGOV, USFR or Treasury Money Market like VUSXX are functionally equivalent. Just pick whatever is most convenient for you.
If I wasn’t barred from cash rebates due to pattern day trader flag I’d do that but alas I guess USFR/sgov/bil has same interest rate payment AND you can use those as safe collateral for margin loans or margin spending. Pretty handy
you don't lose growth due to a conservative tilt. you lose growth with elevated risk. you want the best risk-adjusted return, not the most growth. use your cash to buy ultrashort government bonds, e.g., USFR or VGUS, or just hold it in a MMF or HYSA. this essentially cuts your maximum drawdown in half, and gives you dry powder to bring your account back into balance when stocks are cheap. when the market recovers, you end up with a bigger balance than before the drawdown started. [https://portfoliocharts.com/2022/04/12/unexpected-returns-shannons-demon-the-rebalancing-bonus/](https://portfoliocharts.com/2022/04/12/unexpected-returns-shannons-demon-the-rebalancing-bonus/)
Yeah, waiting would be the prudent thing to do. My guess is we go down 10-15% or so, either now or within a few months. I have some SQQQ and some QQQ put options, but mainly because some longs I don't want to sell for tax reasons. That keeps my port from moving much either direction until I get a better sense of the market direction. Being in cash is fine also (SGOV or USFR)
Yeah, keep my head down, and be quiet :( AKA: stick with VOO and USFR
33% short term treasuries USFR. Got a nice lil cash flow each month, and I can rebalance if we dip, or if we continue to rip for some reason, well, I guess I still win just not as much
Short-term Treasuries. Their price doesn't change with the interest rate. But they pay interest based on the interest rate, so he'll be receiving less interest when the rate goes down. Same as holding BIL or USFR ETFs, or having money in a high-yield savings account.
I see it as a way to pay for the gold membership. I have emergency funds in USFR to qualify for the margin so why not?
I’m 33% USFR. Sleeping like a baby and will rebalance if we dip
Only buy puts in the context of a straddle. True bears buy TLT GLD and USFR
cash is actually a good strategy if you're bearish. I recently adjusted strategy to basically rebalance using USFR. So if it dips, I reallocate to the assets that are going down and when it rips I restock cash position to bring the ratio into balance. ONLY adjusting the USFR to avoid taxes.
55 year old here. Feel nervous about a crash in the next year, so this week I moved out of QQQ and into USFR (treasury bond fund paying around 4%). I’m hoping to retire in the next five years so I just can’t risk a crash. So now I’m 50% in bonds. Maybe I’ll miss out on some gains, but I’ll sleep better knowing I’m not in danger of losing a big chunk of my retirement savings. The world is just way too volatile and weird right now. It’s unlike anything I’ve ever experience in my lifetime.
From the category of extremely safe bond funds (USFR, SPAXX, SGOV, AND ICSH), ICSH has the highest total yearly returns. With the grand total sum being 21.71%, and the average being 1.97%, and it's the only one who has never been at a loss. I wouldn't fully rely on the 30 day yields shown by these funds. Many of these bond funds are showing an irregular pattern of higher returns from 2023-2024 and it's starting to slow down this year. It seems temporary.
Throw a portion of all profits into a etf that generates dividends. I normally do like 25-50% of all profit straight into USFR so I can never lose it all.
you are right, 5.4% was last year. Total annual return year to date is 3.26% source [https://totalrealreturns.com/n/USFR?normalize=off](https://totalrealreturns.com/n/USFR?normalize=off)
Where are you seeing USFR is 5.4%? I'm seeing the 30-day SEC yield at 3.97%, [per their website](https://www.wisdomtree.com/investments/etfs/fixed-income/usfr).
USFR is 5.4%, has lower fees, and should be available in fidelity
I’ll take the 7%—and presumably the tax beating that comes with it—for my weekly savings going forward. Would have settled for whatever USFR is yielding, since that’s what I’m doing now. I’m happy with my positions in growth, value, and Treaurys. I don’t see anything remotely tempting. I’ll be an opportunistic buyer at better prices.
piggybacking to add USFR too -- US T-bill ETF that basically gets laddered for you (and has the liquidity of a stock/etf), what i hold the majority of my EF in.
USFR, it yields 4.34% currently and is buying short term treasuries so as safe as what you have
Do you reinvest your USFR dividends? Or do you keep your earned dividends as Spaxx?
Unless you want capital gains instead of a cash dividend, in which case you could choose from the following, depending on the time of month: TBLL SGOV USFR
You could just put that money in USFR and make 4% on it without the risk of the deal falling through.
It's okay. You're referencing the devaluation of the dollar relative to other currencies with the 10% which matters but doesn't matter to individuals at the same time unless it's extreme and long-term. At that point it would matter to businesses who purchase abroad as it potentially compresses margins and individuals who purchase a lot of goods abroad, who travel, or plan to live abroad. I'd suggest your mom put her money in a short-term treasury floating rate fund like USFR. It should at least maintain with inflation and she won't experienc3 fluctuations aside from the zig zag movement of the monthly payouts. I think anything else comes with some risk that she would need to be comfortable with understanding.
Yeah man PLEASE put 250k into like USFR or something and get paid from dividends. Don't gamble it away
Know anything in terms of SGOV vs USFR?
Move 20-40% into T-bills via USFR or TreasuryDirect.gov.
Congratulations on starting so early. I'd recommend going 100% VT (Vanguard Total World Market) in your Roth. By far the most set it and forget it ETF available, it handles your US and International diversification. Make sure you have a reported income of at least how much you contribute to the Roth in a year. If you have rent and/or other expenses to worry about, I'd wait to start investing in another brokerage and first open a high yield savings account where you keep at least 6 months worth of your expenses. Or put it in a brokerage in a fund like SGOV or USFR, which will give you a similar yield to a HYSA. If you manage to fill that or don't need it, the S&P 500 is fine in your brokerage if you don't mind the risk.
I’m retired now, so I’ve got about five years of spending in short term Treasury ETF (USFR). Prior to retirement I had everything in stocks.
If you’re considering SGOV look into USFR it yields slightly more
Agreed. If interested in a few tickers which track Treasuries, have a look at these: SGOV TBLL USFR
Currently have a recurring plan with SGOV and USFR but ty I’ll add VT into the allocation…
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’m storing my emergency fund in USFR through vanguard. Is there a feature that lets me automatically reinvest the dividends?
I have Schwab and keep some cash in SWVXX but have recently moved most of it to USFR since it pays slightly more dividend but mostly since it is available immediately unlike SWVXX, which you have to wait until the next day to access funds. A friend has Fidelity and he says all his cash is automatically rolled up into their version of SWVXX, but is also available immediately.
There are several that are good. USFR - SGOV I like BOXX - it gets you 4.29% and you don't pay taxes till you sell. Share price goes up 1 or 2 cents - every day. Never goes down. Make 50cents per month per share. $6 per year. That's 4.29% like clock work. Simple and efficient. Some folks wonder if the strategy will last forever? I don't know but I keep buying 1 share every week until I retire - or until the share price stops going up 1 or 2 cents everyday.
I’m doing the same thing, just in USFR
SGOV and USFR are both paying around 4.6% right now. That’s about $525 more over the course of a year compared to a HYSA paying 4.1%. Assuming those interest rate differences stay the same, of course.
The key is not to \*use\* the credit. So for example, if you have 10k in available credit, but you're putting things on the cards for say rewards points, that may not cover the whole of your emergency fund if something really big happened that you needed to pay for immediately (like the upfront cost of a doctor visit where you broke your foot or a tow bill at 2 am in the middle of nowhere). So it sounds to me like you could do some kind of split safely (like maybe 6-7k in a HYSA and float the other 3-4k in SGOV). Some emergency items (like furnace repairs, ER visits, or sewer repairs) offer SUBSTANTIAL savings for paying on the spot, so that's the key there for an emergency fund (or a sufficiently large credit card). Has any of your money come from a job? If so you can put that money in an IRA. I would say that your thinking is incorrect about an IRA - you should have one now if you have \*any\* earned income in 2025 and here's why: 1.) You can put 10k towards a first time home purchase. 2.) You can withdraw contributions at any time - so for example, if you put 7k in today, you can take out 7k even 5 years from now, and since it's matched to a contribution you wont pay a penalty. You can even put the money back in, in 60 days and not have it count against you. So say you withdraw 15k in contributions to buy a car, but talk the dealership down to 12.5k you can put the rest of the money back without any hassle. 3.) You wont pay taxes on the earnings and should you ever want to sell it doesn't create a taxable event. Also dividends are tax free (unless they're foreign companies). The advantages are too large to simply ignore them for no good reason. For my personal set up: 10% of all of my paychecks go into a ROTH IRA, and once that's maxed out for the year, I switch to my HSA through work. I don't make enough money to max both with just 10% lol. 10% of my paycheck goes towards "goals" - cars, house renovations, etc. I have a 401k at work that I put 6% into and they match me 4% to get me an additional 10% - so I'm actually saving 16% of my income in tax advantaged accounts and my company matches me to get to 20% so that 10% saved for "me" items is guilt free lol. In summary: I would put some money in a ROTH \*today\* as long as you have earnings to cover it. I would buy stocks with that money as you've outlined in your post. The rest, outside of a decent cash retainer for emergencies, would be in a taxable brokerage account in VBIL or SGOV (honestly for me the main use case for USFR, SGOV, or VBIL is how much money I have since they're different denominations). Any money you anticipate needing in the next 5 years I absolutely would not put into the stock market.
1. Make sure this "long term" money is in a tax protected vehicle like an IRA, which I assume it is? 2. There's a lot of advice about what to do with emergency savings. Mine is pretty different: a.) The ideal amount of money you need in an emergency fund is the full replacement value of your car (if you're American and don't live in a select few cities). Most people only really fall into big financial trouble if they can't handle credit cards, or their vehicle dies/has big problems, and they have to take out a usurious auto-loan. If you become wealthy enough to where that amount of money no longer \*also\* represents 6 months of spending, then proceed to save more. b.) Have your emergency fund in a high yield savings account like Capital One, Ally, Sofi, or the many other online banks that offer better interest rates. You never know when you will need that cash instantly \*until\* you have a credit card that you don't use that has a higher credit limit than your emergency fund. Say, for example, 12k represents 6 months of living expenses and you paid 10k for your car. You have a credit card that \*always\* has 12k available credit. You can then move your emergency savings out of a high yield savings account/or a taxable brokerage that is \*only\* in money market funds, and into a taxable brokerage account. c.) Once you have sufficient credit, you can move your emergency savings into things like SGOV, VBIL, or USFR. These will have a settlement period of 3 days or so - that's why I don't like using them in a scenario where you don't have sufficient credit.
No worries. What broker are you using? Use an easy central place like Fidelity. The default money market is more than most HYSA, if you want a step further out it in SGOV. If you want to automate, have auto buy of SGOV, then sell the SGOV to do the nondeductible contribution for the conversion (backdoor). The money should be like no other: short term money = SGOV. Long term money sp500 or NASDAQ on an auto weekly (or biweekly paycheck) basis. You just have a funny “reason” for short term, it is still just short term. You can even use a different ETF like USFR or BIL just to segregate. DM me if you have other questions. Best of luck
USFR, TFLO, and SHV might be worth a look
I guess this depends on your definition of what “cash” is and what you’d like your access to it to be. Like can you wait 24 hours after the next trading day for access for example. I would consider any money market fund to be functionally equivalent to cash and certain ETFs to be near enough as well. Yes theoretically the dollar could break but if that happens with a MMF made of treasuries well worse things are happening. The laziest way would be to set your “core position” at fidelity to SPAXX since it is the default place any cash transferred in goes and it auto-liquidates were you to say withdraw money from an ATM or pay a bill and requires no planning. Slightly more effort is to allocate money to a money market fund of your choice to either get better tax treatment or yield. Most treasury only MMFs are hovering just under 4.0% these days. These will auto-liquidate too but and cash you deposit will need to be used to buy these funds manually. The method that yields the most is to buy a short term treasury ETF like SGOV or USFR (which yield just under 4.5% today and is state tax exempt if that matters to you) and simply sell a certain amount when cash is needed. It just won’t be available to withdraw for a business day after the next market day. Is the last method literal cash? No, but I feel like it functionally is for how I keep my emergency fund. I never need tens of thousands of dollars in cash in less than 1 business day. And bottom line I’m not gonna pay some fintech company money to get a worse yield and pay state taxes. I never need literal cash on a moments notice (and most people don’t either).
I just put 33% of my networth in $USFR. I am gonna be so rich.
got any to recommend? Got some gold, but for my fixed income basket, I'm trying to match the yield of USFR but also don't want to hold anything denominated in dollars.
Consider not automatically reinvesting the dividends. The NAV is a little weird on SGOV and USFR and such. The average price is basically constant, but it fluctuates up and down due to the current value of the expected dividend. Depending on when you buy the original shares, sometimes your cost basis will be positive, other times negative. Anyways, if you need to sell the fund mid month, sometimes you can have a very slight loss. If you automatically reinvest dividends the next month it'll trigger a wash sale rule violation. This isn't the end of the world, but it'll cost you another five minutes on your taxes and a momentary freak out when you see the warning banner pop up on your account. This can be avoided by only selling shares with that have a positive cost basis, but I prefer to just manually place buy orders when I'm confident I won't need the cash in the near future.
Yep, all of my emergency fund is in USFR which is similar to SGOV
If rates change you will notice more of a drop in USFR than with SGOV. SPAXX is fine. I haven't lost any money yet. Lol
Also, compare SGOV and USFR , I will not be surprised if you end with USFR.
How far in the future? If within five years, maybe USFR, VBIL, or SGOV. If beyond that, VOO or VTI. But you should think of your portfolio as a whole, and have an asset allocation plan for all of it.
USFR outperforms SGOV over the long run.
SGOV and USFR are the two popular ones I know of
I would personally use USFR if you're comparing to a savings account, it functions more similarly than 3 month treasuries like SGOV. USFR will give you a higher return than your HYSA and have no state income tax. It's perfectly safe unless the US government defaults, in which case your money wasn't safe anywhere.