Schwab money fund pays 0.45% ?

[workmyfingerstothebone]

Recently my sister asked for help on her portfolio, she is retiring.


I see she has a Schwab money fund that pays a paltry 0.45 percent .


I have Vanguard and their money market account is paying > 4 percent .


Does Schwab have another money market fund that pays closer to 4%.



Either I'm not reading Schwabs info correctly (could be as this is first time on the site) or they are behind the yield curve.


Thanks for any help.

 

[FREE866]

Recently my sister asked for help on her portfolio, she is retiring.


I see she has a Schwab money fund that pays a paltry 0.45 percent .


I have Vanguard and their money market account is paying > 4 percent (SEC 7 day yield).


Does Schwab have another money market fund that pays closer to 4%.



Either I'm not reading Schwabs info correctly (could be as this is first time on the site) or they are behind the yield curve.


Thanks for any help.

Im doing this now....


Yes--the standard cash acct only pays like.45%
however you can sweep the money into their money market mutual fund---SNVXX which yields 4.11% or SWVXX which yields 4.38%...that one is more as it has international exposure....one day settlement on those....

 

[HF63]

Just do what FREE866 suggested, very crazy does how Schawb makes money.

 

[ShokWaveRider]

SNAXX - 4.61%
SWVXX - 4.46%

Having their sweep fund low enables them to be very aggressive on their MM funds.

 

[Chuckanut]

Does Schwab have another money market fund that pays closer to 4%.



Either I'm not reading Schwabs info correctly (could be as this is first time on the site) or they are behind the yield curve.


Thanks for any help.

An excellent start to helping your friend would be to follow the advice given earlier and get her into SNAXX or SNOXX, which currently pay over 4%. She would earn almost 10x more interest dollars with very little work. No need for anybody to work their fingers to the bone. How often does that happen?

 

[AzDreamer]

Is it possible to change the cash sweep so dividends and interest automatically go into one of their money market funds? I am online looking at my account and can't see how this is done.

 

[Andre1969]

Thanks for this post. One of my old 401ks is with Schwab. I never paid much attention to the "cash" portion of it but sure enough, it was earning almost nothing. So I moved the bulk of it into one of their MMAs. Probably still losing a bit compared to inflation, but it beats getting almost nothing at all!

 

[ShokWaveRider]

Is it possible to change the cash sweep so dividends and interest automatically go into one of their money market funds? I am online looking at my account and can't see how this is done.

I do not think so, but it is easy to do manually.

 

[target2019]

Recently my sister asked for help on her portfolio, she is retiring.

I see she has a Schwab money fund that pays a paltry 0.45 percent .

I have Vanguard and their money market account is paying > 4 percent .

Does Schwab have another money market fund that pays closer to 4%.

Either I'm not reading Schwabs info correctly (could be as this is first time on the site) or they are behind the yield curve.

Thanks for any help.

This is the page for Schwab money funds. https://www.schwab.com/money-market-funds

You are looking at the sweep fund, which is much lower. Schwab does not have a default money market fund for the sweep account.

So my routine is to look at the account once a month, and but SWVXX if I have too much cash in the account.

You can also transfer sweep cash to a linked Schwab checking account and pay bills from there.

 

[target2019]

Is it possible to change the cash sweep so dividends and interest automatically go into one of their money market funds? I am online looking at my account and can't see how this is done.

Can't be done. Mark it up as a Schwab flaw.

Go in once a month, once a quarter, or whenever and use the money to buy, or transfer to checking.

https://www.schwab.com/money-market-funds

 

[OverThinkMuch]

For my safe cash reserves I prefer to stick with Treasuries, so I like SGOV 4.3%.
https://www.ishares.com/us/products/314116/ishares-0-3-month-treasury-bond-etf

 

[Chuckanut]

Is it possible to change the cash sweep so dividends and interest automatically go into one of their money market funds? I am online looking at my account and can't see how this is done.

That is a sore point with many of us. You can't do it. I tranfser money to SNAXX or SNOXXZY or whatever fund, but you have to remember to move it back to the sweep before buying anything else. A bit of a pain.

 

[pb4uski]

That is a sore point with many of us. You can't do it. I tranfser money to SNAXX or SNOXXZY or whatever fund, but you have to remember to move it back to the sweep before buying anything else. A bit of a pain.

+1 but you don't need to move it to settlement before buying anything else. Often... but not always and I can't figure out why... you can buy securities online even though your settlement account is zero and those trades result in a negative settlement account balance. Then you just need to make sure that you sell SWVXX to cover the trade when it settles. If you can't do it online then you need to call your broker.

This happens often with new issue bonds, which can take up to 2-3 weeks between trade and settlement. I'll have a significant negative balance in my settlement account for that 2-3 week period. And then if some income is posted and I don't want it languishing in the settlement account at 0.45% I have to call to transfer it over to SWVXX... online will not allow you to buy SWVXX if your settlement account is negative, but you can do it if you call.

Luckily, at my transaction volumes this is a minor annoyance rather than a major PITA.

 

[Born2Fish]

Glad this topic came up.

I've been buying T-bills and reordering at maturity in one of my TDA accounts.

Just ordered SWVXX. Much easier.

 

[Rickt]

Does SWVXX have a redemption fee if sold before 180 days?

I see this disclaimer when I try to buy SWVXX:
"All no-transaction-fee (NTF) funds (except ProFunds, Rydex, and Direxion funds) held 180 days or less are subject to a short-term redemption fee of $49.99. This fee is in addition to any applicable transaction fees or fees addressed in the fund prospectus."

Thanks!

 

[ShokWaveRider]

Does SWVXX have a redemption fee if sold before 180 days?

I see this disclaimer when I try to buy SWVXX:
"All no-transaction-fee (NTF) funds (except ProFunds, Rydex, and Direxion funds) held 180 days or less are subject to a short-term redemption fee of $49.99. This fee is in addition to any applicable transaction fees or fees addressed in the fund prospectus."

Thanks!

Google SWVXX and you get this:

Fees & Expenses
Front load N/A
Max. redemption fee N/A
Total expense ratio 0.11%
12 b-1 N/A
Turnover N/A

 

[audreyh1]

I haven’t held that fund at Schwab for a long time, but in general money market funds aren’t subject to holding periods and I can’t imagine why Schwab would display that message.

 

[youbet]

Does SWVXX have a redemption fee if sold before 180 days?

No

 

[11522914]

And then if some income is posted and I don't want it languishing in the settlement account at 0.45% I have to call to transfer it over to SWVXX... online will not allow you to buy SWVXX if your settlement account is negative, but you can do it if you call.

This I did not know. Thanks for the information.

 

[Texas Proud]

Does SWVXX have a redemption fee if sold before 180 days?

I see this disclaimer when I try to buy SWVXX:
"All no-transaction-fee (NTF) funds (except ProFunds, Rydex, and Direxion funds) held 180 days or less are subject to a short-term redemption fee of $49.99. This fee is in addition to any applicable transaction fees or fees addressed in the fund prospectus."

Thanks!

Maybe it is for people who buy a LOT of the fund... big inflows or outflows can mess up a fund...



Back when I was in corp trust I would buy between $200 mill and $500 mill for a week every month or so before payments... I had to keep the fund informed of when they were getting money and when I was gong to take it back...

 

[Rickt]

Google SWVXX and you get this:

Fees & Expenses
Front load N/A
Max. redemption fee N/A
Total expense ratio 0.11%
12 b-1 N/A
Turnover N/A

Thank you ShockwaveRider.

Rick

 

[Rickt]

Thanks Audreyh1, Youbet and Texas Proud !

Rick

 

[workmyfingerstothebone]

Wow, thanks everyone for all the info.


I have her moving money into laddered Treasuries and Agency bonds. Will look into adding a money market or mutual fund.



She is withdrawing monthly from the "cash" account for living expenses.
Not sure how that effects her if using one of the mutual funds mentioned, ie.. to withdrawal cash monthly, in this thread. If Schwab charges $49.99 for selling funds before 6 months that's an issue.


I'm no financial expert but thanks to this site I'm getting better

 

[workmyfingerstothebone]

Im doing this now....


Yes--the standard cash acct only pays like.45%
however you can sweep the money into their money market mutual fund---SNVXX which yields 4.11% or SWVXX which yields 4.38%...that one is more as it has international exposure....one day settlement on those....

Thanks for the info:
SNVXXhas an gross expense ratio of 0.38%,,, seems high to me for a money market fund. Is that yield, 4.11 %, after expenses ?
I'll have to check what my Vanguard cash account fee is...

 

[workmyfingerstothebone]

Thank you ShockwaveRider.

Rick

Thanks for the info,


I'm showing a gross fee of 0.34%


https://www.schwabassetmanagement.com/products/swvxx