Recommendations on where to park $10K

[firemediceric]

I have a little over $10k sitting in a savings account earning next to nothing in interest. Although I don't anticipate needing this money any time soon, I want to keep it within reach should an emergency arise. Suggestions?

I don't have the stomach to put the money in the stock market at present. I don't want to put it in a CD that will leave the money out of reach for months at a time. Any good money market funds as an alternative? Something better?

 

[Reach]

For $10k and over, a Capital One 360 Money Market will offer you one of the best rates available.

I have one and they routinely adjust/increase the rate, currently at 1.85% APY.

 

[audreyh1]

Do you consider high yield savings accounts yielding 1.9% or better to be “next to nothing”? Above that you have to lock up your money for a bit longer (or accept early withdrawal penalties) or take more risk.

 

[Oz investor]

geee!

that is a problem many have ( i would imagine )

i have my spare cash in an account that pays monthly interest ( it isn't much but every dollar counts ) but i can withdraw some or all at ant time

maybe an ETF the plays the money market ( but personally i don't like such products )

remember that extra fraction of income normally entails extra risk ( or expense )

 

[Another Reader]

https://www.depositaccounts.com/

I don't like Capital One. There are others that pay more and are easier to work with. Look at the various rates displayed at the above site.

Vanguard also offers very good rates on its' treasury money market fund and its' prime money market fund. Right now, slightly better than the savings accounts and money market funds in most cases.

 

[Luvdogs]

I just put some in Marcus at 1.90% on Wednesday. It was credited the next day but the available balance is still zero. I started with a small amount because they say for the first 30 days they put longer holds on it.

After 30 days I'll put a larger chunk in as long as everything runs smoothly until then since it's online only--but FDIC insured, etc.

Did ACH transfer, no charges on either end (so far). I wasn't sure if Chase would charge to transfer $ out.

 

[OldShooter]

T-bills bought on the auction. If necessary they are easy to sell before maturity and you don't take much of a hit. Treasury bills are issued for terms of 4, 13, 26, and 52 weeks. Schwab, Fido, et al charge little or nothing to buy them for you.

 

[firemediceric]

Do you consider high yield savings accounts yielding 1.9% or better to be “next to nothing”? Above that you have to lock up your money for a bit longer (or accept early withdrawal penalties) or take more risk.

That is indeed better than nothing. Realizing I want to retain easy access and liquidity, I realize that limits my returns. I appreciate the good suggestions that will maximize what I earn, even if it is minimal

 

[pb4uski]

Vanguard Prime Money Market Fund (VMMXX) pays 2.1%, is totally liquid and infintesimal credit risk and no interest rate risk.

 

[Fedup]

Vanguard Prime Money Market Fund (VMMXX) pays 2.1%, is totally liquid and infintesimal credit risk and no interest rate risk.

Has it gone up since the FED raise the rate last week?

 

[pb4uski]

Dunno... website says 2.15% APR.... .05% higher than the last time that I looked sometime last week.

 

[audreyh1]

I suspect it’s tracking something like the 3-month T-bill.

Note the none of the t-bills take an immediate jump when the Fed raises rates. They just gradually drift higher, and the 1 month and 3-month are lagging the Fed Funds rate at the moment.

 

[mrfeh]

I have a little over $10k sitting in a savings account earning next to nothing in interest. Although I don't anticipate needing this money any time soon, I want to keep it within reach should an emergency arise. Suggestions?

I don't have the stomach to put the money in the stock market at present. I don't want to put it in a CD that will leave the money out of reach for months at a time. Any good money market funds as an alternative? Something better?

Online savings account or short term bond fund (like VFSTX).

For a sum of $10K, don't sweat small differences in interest/dividends. You're talking about tens of dollars per year.

 

[Rosie]

There are also no-penalty CDs.

For $10,000, Ally's 11-month NP CD is currently paying 2.0%.
https://www.ally.com/bank/no-penalty-cd/

The money can be withdrawn any time after the first six days and you keep the accrued interest with no penalty.

Ally is very easy to deal with, imo. All of my transactions have been done online.

The caveat is, it's all-or-nothing, you can't make partial withdrawals from the CD. But since the current 2% tier is $5,000 to $24,999.99, you could open two CDs.

 

[pb4uski]

^^^^ Doesn't sound attractive compared to VMMXX at 2.15% APR and totally liquid.

 

[Rosie]

^^^^ Doesn't sound attractive compared to VMMXX at 2.15% APR and totally liquid.

Correct. You win!

 

[kgtest]

Broker at VG. Take a little risk, have some fun. Maybe AAPL, AMZN or QQQ, VHT.



I always recommend VUG as someone's first ETF.

 

[firemediceric]

https://www.depositaccounts.com/ QUOTE]

Thank you for the link. Based on what I'm seeing there, I plan to park $10k at Memory Bank for 2.25% APY unless someone gives me pause to think differently.
https://www.depositaccounts.com/banks/memorybank.html#rates

 

[njhowie]

My suggestion is not to put it all in to a single high yield savings account.

As I have mentioned on other threads, you can earn significantly more churning through bank account bonus offers. If you need to have a certain amount readily accessible and don't want to tie it up, take maybe half and put in to the very liquid savings account. Then, with the other half, use it to get bank account reward/bonus offers. With $5k, you could put it in to a Citibank account and get $200 in 60 days - that's 4% in just 2 months - double the amount you'd earn on it in a full year in a high yield savings account.

https://banking.citi.com/cbol/18/checking/200/default.htm

There are many more out there like this, and you simply have to open the account, make sure you satisfy the requirements, collect your money, then close once you've collected and leave the account open long enough to avoid any early closure fees.

If you want the best one as far as bang for the buck, none beats the HSBC checking account - deposit $1500, receive $200 bonus 90 days later (they actually credit it within 8 weeks after the $1500 balance is maintained for 90 days).

https://www.us.hsbc.com/checking-accounts/campaigns/offer-2018/#choice-checking-details

 

[Dtail]

^^^^ Doesn't sound attractive compared to VMMXX at 2.15% APR and totally liquid.

Yes, I use Fidelity's version at around 2.03%. Would use Vanguard, but have most of investments at Fidelity.

 

[BigMoneyJim]

CDs can be broken if needed. I've been using CDs for emergency funds for years. I haven't had to break one yet. You could put it in more than one CD so you don't have to break the whole thing at once if needed.

 

[mtpisgah]

I opened an American Express savings account last week, 1.9% if I recall correctly. It is better than the CDs I have had the money over the last few years. I am starting with 10k and will drop another 10k in it over the next month. Two CDs worth a total of 40k mature in November and I add those when appropriate.

I am hoping the interest will pay for upgrades from coach to biz class flights for Italy next year.

 

[firemediceric]

Thank you for the suggestions. I ended up opening the HSBC account with $1,500 to get the $200 bonus in 90 days. I then used $1,000 to open an account at Memory Bank for 2.25% on money I can withdraw at any time. https://www.depositaccounts.com/banks/memorybank.html#rates

They have been very slow to set up my account. HSBC had me up & running in two days. I'm at almost a week with Memory Bank. Once my account is indeed set up I'll move $10,000 into it and let it sit until I need the money or something better comes along.

 

[Red Badger]

I have a little over $10k sitting in a savings account earning next to nothing in interest. Although I don't anticipate needing this money any time soon, I want to keep it within reach should an emergency arise. Suggestions?

I don't have the stomach to put the money in the stock market at present. I don't want to put it in a CD that will leave the money out of reach for months at a time. Any good money market funds as an alternative? Something better?

Rather than fret over this, you can just send the 10 Grand to me.

Problem solved!

 

[njhowie]

Thank you for the suggestions. I ended up opening the HSBC account with $1,500 to get the $200 bonus in 90 days. I then used $1,000 to open an account at Memory Bank for 2.25% on money I can withdraw at any time. https://www.depositaccounts.com/banks/memorybank.html#rates

They have been very slow to set up my account. HSBC had me up & running in two days. I'm at almost a week with Memory Bank. Once my account is indeed set up I'll move $10,000 into it and let it sit until I need the money or something better comes along.

Great - I love when we can get free money like this!