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Places to put short term savings
Old 03-11-2018, 06:23 AM   #1
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Places to put short term savings

https://thefinancebuff.com/treasury-...ey-market.html

Interesting article about using treasury bills that can be purchased through vanguard or fidelity, etc without a fee. No state tax. Any other thoughts on how to invest emergency funds?
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Old 03-11-2018, 09:33 AM   #2
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Very interesting. I use the online savings account and assorted CD’s at Ally for the bulk of my cash/short term holdings but I agree this looks like a good (and simple) alternative. I also would be interested in others’ take on it.
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Old 03-11-2018, 09:50 AM   #3
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Most of our short term funds are in Vanguard Limited Term Tax Exempt fund. A little NAV volatility but not an issue for me.
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Old 03-11-2018, 10:27 AM   #4
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Originally Posted by Osprey View Post
https://thefinancebuff.com/treasury-...ey-market.html

Interesting article about using treasury bills that can be purchased through vanguard or fidelity, etc without a fee. No state tax. Any other thoughts on how to invest emergency funds?
We buy T-Bills on the auction. Super easy and various maturities available.
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Old 03-11-2018, 11:01 AM   #5
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Originally Posted by Osprey View Post
https://thefinancebuff.com/treasury-...ey-market.html

Interesting article about using treasury bills that can be purchased through vanguard or fidelity, etc without a fee. No state tax. Any other thoughts on how to invest emergency funds?
The best way to buy treasuries is through Treasurydirect.gov You can buy other government bond products also.
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Old 03-11-2018, 11:22 AM   #6
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The best way to buy treasuries is through Treasurydirect.gov You can buy other government bond products also.
I just place my orders with the Schwab bond desk. I don't know why treasurydirect would be any better. Usually Schwab waives their standard $25 fee, but even if I pay it that's pretty cheap compared to screwing around with another investment account and having to move money. Typically I am buying low six figures. Depending on the trade size I guess YMMV.
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Old 03-11-2018, 12:46 PM   #7
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I just place my orders with the Schwab bond desk. I don't know why treasurydirect would be any better. Usually Schwab waives their standard $25 fee, but even if I pay it that's pretty cheap compared to screwing around with another investment account and having to move money. Typically I am buying low six figures. Depending on the trade size I guess YMMV.
Schwab, TD Ameritrade, Fidelity (I have accounts at all three), bury their fees in the price you pay for the treasury. So you get a slightly lower yield than Treasurydirect. Nothing in the financial world is free.
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Old 03-11-2018, 01:18 PM   #8
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Schwab, TD Ameritrade, Fidelity (I have accounts at all three), bury their fees in the price you pay for the treasury. So you get a slightly lower yield than Treasurydirect. Nothing in the financial world is free.
That is not true at Schwab. I did not believe it to be the case and I just called them and verified.

To be sure we're talking apples and apples, I am talking about buying on the auction just as is done with treasureydirect. Buying on the secondary market is a whole different animal and is not possible with treasurydirect AFIK.

Edit/From Schwab's web site: "New-issue Treasuries There are no markups or fees for online purchases. New issues purchased with the assistance of a Schwab broker are subject to a $25 broker-assisted fee." https://www.schwab.com/public/schwab...ury_securities
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Old 03-11-2018, 01:31 PM   #9
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Originally Posted by Osprey View Post
https://thefinancebuff.com/treasury-...ey-market.html

Interesting article about using treasury bills that can be purchased through vanguard or fidelity, etc without a fee. No state tax. Any other thoughts on how to invest emergency funds?

Thanks for the link. Didn't realize 3 and 6 month T-bills were now paying better rates than brokered CDs. Will have to take a look at this again when my CDs mature over the next several months.
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Old 03-11-2018, 04:17 PM   #10
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That is not true at Schwab. I did not believe it to be the case and I just called them and verified.

To be sure we're talking apples and apples, I am talking about buying on the auction just as is done with treasureydirect. Buying on the secondary market is a whole different animal and is not possible with treasurydirect AFIK.

Edit/From Schwab's web site: "New-issue Treasuries There are no markups or fees for online purchases. New issues purchased with the assistance of a Schwab broker are subject to a $25 broker-assisted fee." https://www.schwab.com/public/schwab...ury_securities
TDAmeritrade charges a $25 flat fee for auctions and on a net yield basis otherwise:
https://www.tdameritrade.com/pricing.page

Schwab (you are correct for online purchase) only charges a fee of $25 for broker assisted at auction

https://www.schwab.com/public/file/P...23060SI-17.pdf

Fidelity is no fee for online and $19.95 for broker assisted for auction

https://www.fidelity.com/bin-public/...e_Schedule.pdf

These fee changes online auction purchases must have been done in the recent past. They were charging the fees prior to their recent reductions in commissions.

Moving money around taxable accounts is not an issue these days. I have my Treasurydirect account for over 18 years now linked to my bank accounts and never had an issue.
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Old 03-11-2018, 04:20 PM   #11
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We buy T-Bills on the auction. Super easy and various maturities available.
Ditto.
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