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Vanguard Prime MM vs TE-MM
Old 06-17-2013, 04:50 PM   #1
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Vanguard Prime MM vs TE-MM

We are in the ~28% tax bracket. while not all are cash is w/ vanguard we do have a nice chunk of it sitting in VMMXX (prime mm) fund. does having it in VMSXX (TE MM) make that much of a difference?

Looking at the after tax numbers, though the difference is minimal the TE has eeked out ahead.
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Old 06-17-2013, 06:46 PM   #2
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Depends on one's marginal tax rate. Which V MM has the best after-tax returns can vary over the years. Personally, I've also used short-term funds to 'park' some cash these days (of course accepting a bit more risk for higher dividend rate).
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Old 06-17-2013, 07:38 PM   #3
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Right now the Vanguard lists the SEC yield at 0.01% for both funds. 28% of zero is zero.

You'd be better off putting the money into FDIC insured CDs or savings accounts (with interest rates ~1%). That's said, through inertia and laziness I have too much of my portfolio in VMMXX.
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Old 06-17-2013, 07:48 PM   #4
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we have etf in our vanguard brokerage that dumps dividends into vmmxx. was thinking about using the vmsxx instead, but also through laziness not sure it is even worth the few pennies it would save.
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Old 06-18-2013, 09:28 AM   #5
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Quote:
Originally Posted by photoguy View Post
Right now the Vanguard lists the SEC yield at 0.01% for both funds. 28% of zero is zero.

You'd be better off putting the money into FDIC insured CDs or savings accounts (with interest rates ~1%). That's said, through inertia and laziness I have too much of my portfolio in VMMXX.
Despite the convenience (all funds in one place), I finally gave up on VG altogether for cash holdings and put it all in a) max allowable in iBonds, and b) the rest at Ally. Might as well get ~ 1% instead of ~ 0%...
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Old 06-18-2013, 02:42 PM   #6
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I just use the VG Prime MM for a brokerage sweep account with a typical balance of about $100. It's easy to move in and out of from my bank so it's no big deal.
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