Vanguard Prime MM vs TE-MM

[Lazyfabs]

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.

 

[ERhoosier]

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).

 

[photoguy]

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.

 

[Lazyfabs]

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.

 

[Midpack]

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%...

 

[foxfirev5]

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.