We automatically put this money into the highly competitive Vanguard Federal Money Market Fund where it can grow.

All investing is subject to risk, including the possible loss of money you invest. See how it compares.Still have your cash in a bank account—or stashed under your mattress? Since I always put money into VG on the first of the month I figured just keeping it in one of the two accounts you're suggesting makes sense, but is it better to go with a fund with a better yield? My other mutual fund company made it easy by simply eliminating its prime fund and transferring everything to a government fund.You can type something like this into the Bogleheads.org search box to look for yourself: prime federal money market. Not at Vanguard. Plus periodic ACH payments to other entities. The fund generally invests 100% of its assets in government securities, satisfying the 99.5% minimum requirement set by the Securities and Exchange Commission for designation as a government money market fund.Introduced in 1992, the Treasury Money Market Fund is managed by Vanguard's Fixed Income Group, one of the world's largest fixed income investment advisors, with approximately $1.6 trillion in assets under management as of March 31, 2020.

The exception might be in an IRA, since you can't easily move money back and forth between a bank account and a brokerage account (unlike a taxable brokerage account for which it is easy and quick).I have a money fund only in my IRA. Weighted ER< .10%. No matter how simple or complex, you can ask it here.Vanguard is highlighting information on their web-site about the rate of their federal money market fund (VMFXX which is also their settlement account and has a current SEC yield of 2.04%) as being higher than many other outside money market accounts. These include one other government money market fund and several retail money market funds as shown below: ¹ In accordance with money market reforms adopted by the Securities and Exchange Commission in 2014, institutional assets are no longer accepted into funds designated as "retail." It invests in all kinds of short-term debt investments like treasury bills, bank CDs, commercial paper, and yankee bonds. Are you investing outside of an IRA or other retirement account? VMFXX is classified as a federal money market fund and does not have these restrictions.

No guarantees are made as to the accuracy of the information on this site or the appropriateness of any advice to your particular situation.↳   The Bogleheads® Wiki: a collaborative work of the Bogleheads community

No changes to the Treasury Money Market Fund's investment strategies are anticipated as a result of its closing to new investors.

Vanguard has designated Vanguard Prime Money Market Fund as a retail money market fund. There's a few out there in the 2.3% range if you put $25k down.Vanguard provides a sheet that lists the percentage of income for each fund, including money market funds, derived from federal debt not subject to state and local taxation each year when the 1099 is issued. "By gnawing through a dike, even a Rat can destroy a nation ." View mutual fund news, mutual fund market and mutual fund interest rates. See a complete list of Vanguard money market funds. It bounced back smartly the next year, but it made me realize that short-duration bond funds are not really a cash substitute.Long is the way and hard, that out of Hell leads up to light.With an SEC yield now at .80%, Prime MMF is one 1/4 point rate hike from parity or better with the most popular on-line savings accounts. . Our Prime Money Market Fund* and 5 tax-exempt funds* (1 national and 4 state municipal money market funds) are retail funds that seek to maintain a stable $1 NAV. Although these securities are high-quality, most of the securities held by the fund are neither guaranteed by the U.S. Treasury nor supported by the full faith and credit of the U.S. government.

Currently with yields at .86% for Prime Admiral vs .57% for Federal MM, that's a .29% spread. These conservative funds invest in short-term debt instruments like …

This chart shows the liquidity levels of Vanguard Prime Money Market Fund from January 2008 through June 2016. See the difference between putting your cash in a bank account or investing it in a Vanguard money market fund.The SEC yield is the average amount earned by a money market fund's investors (after expenses) over the past 7 days and then multiplied into an annual figure.

I suppose Prime comes with a tad more risk, but is it really 50% more risky? Based on some of the responses is it that the Federal MM fund has a tax advantage over the Prime fund? Other items a fund might include are certificates of deposits offered by banks and asset-backed securities.

The Vanguard Prime Money Market Fund offers yields just over 2 percent. *The 7-day SEC yield as of March 31, 2020, for Vanguard Federal Money Market Fund. footnote * For the 10-year period ended December 31, 2019, 9 of 9 Vanguard money market funds outperformed their Lipper peer-group averages. No matter how simple or complex, you can ask it here.Is there a thread somewhere on the forum discussing the relative merits and risks of staying with the Prime Money Market Fund vs. going with the Federal Money Market Fund in light of the regulation changes coming in October?

From May 2010, when the SEC imposed liquidity requirements, the liquidity of Prime Money Market has remained above the 30% threshold that could potentially lead the fund's board to impose fees and/or gates.

I'm taking monthly IRA distributions, so it's a convenient place to pool bond fund dividends (can't see reinvesting at these prices) and from which to take the distributions. For instance, the Vanguard Prime Money Market fund invests in U.S. Treasury Bills and other government securities as well as what is known as safe commercial paper, or short-term promissory notes issued by companies. There is also a Vanguard Federal Money Market Fund (VMFXX). Would sleep like a baby with either choice - the "risks" being discussed here are a bit over the top.70/30 AA for life, Global market cap equity. **The 7-day SEC yield as of March 31, 2020, for Fidelity Government Money Market Fund.