tominboise
Recycles dryer sheets
Is there any advantage one way or the other, for investing cash for one year? AAA corporate bonds and one year CD's have around the same percentage rate at Vanguard. Just wondering where to park cash for awhile.
I am trying to lock in rates for our spending money, for the next couple of years. The CD rates are about the same as the Vanguard mmf, but of course, that can change when the Fed makes a move.CDs will be FDIC insured, corporate bonds are not. I recommend using CDs for one year - much higher credit quality. But also check the Vanguard Money Market Funds rates. Perhaps you are trying to lock in rates?
Most of my very short-term funds are in T-bills which I buy at auction. Mostly 26-week but I do have one 52-week. Recently T-bills have been yielding higher than CDs.
I vote for CDs. It's nice to have some FDIC insured funds to balance things out.
Since you mentioned a one year time frame, I will assume that you have a use for the money in about a year. Therefore a one year CD would be best, IMO. Since you won’t have to worry that the bond might lose value if an unforeseen event triggers higher rates. Granted higher rates are unlikely