BUM said:I'm with WanderALot!
Am I leaving money on the table?
VMSXX div. is .00155 fed free, still state taxable
VUSXX div. is .00201 fully taxable
VYFXX div. is .00151 fed and NY tax free
Right now I have a ton of cash in VUSXX... Filing jointly we should be in the 15% bracket.
What would you do, you was me?
WonderALot
soupcxan said:Someone on the Morningstar boards told me that there is some sort of end-of-quarter glitch that causes MM fund yields to spike, then drop back down. Can anyone confirm that is what's causing these excessive yields? Or is there a reasonable chance that these yields will stay up? I'm debating whether to move money into Emigrant direct at 3.25% taxable or the VG tax-exempt at 2.68%...am tired of shuffling money around.
soupcxan said:Obviously, 3.16% is better than Emigrant Direct's 4.0% if you are in the +25% bracket, plus state taxes could make it even more advantageous. However, I still don't know why these MMF rates spike at the end of the month, nor if there is any reasonable way to predict what the average rate will be over the course of the month.
A snapshot of interest and dividend income from a bond or fund. The yield, expressed as a percentage of the bond's face value or the fund's net asset value, is based on income earned over the past 30 days and is annualized, or projected, for the coming year.and when you click on "C" next to the yield of the MM funds:
C — SEVEN DAY AVERAGE INCOME YIELD NET OF EXPENSES
So, the spike is probably due to the fact that the MM funds are replacing the underlying ultra short paper with higher yielding new paper.
- Alec