Best place to park money short term?

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I'm buying a house within a year and decided to cash out of the market completely to avoid risk. My current savings account gets me .65% I'm curious what the best deal is right now. It probably won't make that much of a difference, I know, but I'd still like to get the most return possible.

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Thanks to all for the replies. The main problem is that I'm not sure when I'll need the money. The timeline is 1 year,... (more)

pooter03 (May. 30, 2013 @ 7:38a) |

You might as well buy SP500 ETF. The gonvernment can not touch it until you cash it in

Famous last words

cecasejr (May. 30, 2013 @ 8:29a) |

NEDeals (May. 30, 2013 @ 2:38p) |

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RCA or other "high-yield" savings accounts.

http://www.fatwallet.com/forums/finance/775437/

http://www.fatwallet.com/forums/finance/783099/

You can get up to 3% if you're willing to do the work with the RCAs and 1% if you're not.


Squeezer99 said:   http://www.fatwallet.com/forums/arcmessageview.php?catid=52&thre...Inappropriate answers for short term / safety

I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.

pooter03 said:    Best place to park money short term?

My checking account!!

mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.

pooter03 said:   mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.


FDIC/NCUA is pretty much a free lunch for maximum yield at minimum risk for very short-term money these days.

pooter03 said:   mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.

High yield checking accounts were already mentioned. For $50k, your talking 4-5 accounts, but an extra $1k interest over the next year. And no, the monthly requirements aren't a burden, it'll require sitting down at your computer for a half hour once/month.

Glitch99 said:   pooter03 said:   mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.

High yield checking accounts were already mentioned. For $50k, your talking 4-5 accounts, but an extra $1k interest over the next year. And no, the monthly requirements aren't a burden, it'll require sitting down at your computer for a half hour once/month.


I thought they required a certain amount of debit card transactions a month. I was never a big fan of debit cards.

pooter03 said:   Glitch99 said:   pooter03 said:   mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.

High yield checking accounts were already mentioned. For $50k, your talking 4-5 accounts, but an extra $1k interest over the next year. And no, the monthly requirements aren't a burden, it'll require sitting down at your computer for a half hour once/month.


I thought they required a certain amount of debit card transactions a month. I was never a big fan of debit cards.
Grrrr.....

Glitch99 said:   pooter03 said:   Glitch99 said:   pooter03 said:   mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.

High yield checking accounts were already mentioned. For $50k, your talking 4-5 accounts, but an extra $1k interest over the next year. And no, the monthly requirements aren't a burden, it'll require sitting down at your computer for a half hour once/month.


I thought they required a certain amount of debit card transactions a month. I was never a big fan of debit cards.
Grrrr.....


I'm sorry, I'm not trying to be a pain and I really appreciate the help, but I'm getting a bit confused. I'm looking at the high yield checking accounts and they all say there's a minimum of x amount of debit card transactions plus at least one monthly ACH. Am I looking at the wrong ones?

pooter03 said:   Glitch99 said:   pooter03 said:   Glitch99 said:   pooter03 said:   mooingmooseman said:   pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.

how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


$50k to start. I have a wedding coming up in a couple weeks so there will (hopefully) be more vis a vis gifts in the form of checks, as well as contributing a few hundred dollars each month until I'm ready to buy. But yah, it really comes down to a few hundred dollar difference. Still, I'd like to get the best bang for my buck so to speak. If nothing else, the few extra hundred will help cover attorneys fees or what not. I'm just trying to find out if there's any sort of investment I haven't considered other than savings. I could do a Credit Union I suppose, but the low maximums kinda turn me off. If there was an ETF or fund that barely moved, but earned more than 1% a year I'd be interested. But still, I don't want to mess around too much with my house money.

High yield checking accounts were already mentioned. For $50k, your talking 4-5 accounts, but an extra $1k interest over the next year. And no, the monthly requirements aren't a burden, it'll require sitting down at your computer for a half hour once/month.


I thought they required a certain amount of debit card transactions a month. I was never a big fan of debit cards.
Grrrr.....


I'm sorry, I'm not trying to be a pain and I really appreciate the help, but I'm getting a bit confused. I'm looking at the high yield checking accounts and they all say there's a minimum of x amount of debit card transactions plus at least one monthly ACH. Am I looking at the wrong ones?

No, those are the right ones.

OK thanks. Last question, what are the risks involved in going with something like this:
http://www.duke-energy.com/investors/individual-investors/premie...

Obviously it isn't FDIC insured, but I would imagine the risk of Duke default is pretty low.

pooter03 said:   OK thanks. Last question, what are the risks involved in going with something like this:
http://www.duke-energy.com/investors/individual-investors/premie...

Obviously it isn't FDIC insured, but I would imagine the risk of Duke default is pretty low.


Probably low, but Duke Energy is at the low end of investment grade for their bonds:

http://www.duke-energy.com/pdfs/Credit--Ratings-History.pdf
http://en.wikipedia.org/wiki/Bond_credit_rating

I would imagine that the BIGGEST risk would be some kind of major accident happening at one of their 7 nuclear plants:

http://en.wikipedia.org/wiki/Duke_Energy#Nuclear

Choose the best rate you qualify to open HERE
Its the "only" choice you have to avoid "risk" as you stated, unless you want to jump thru the hoops of the higher yield savings account requirements.

You can look at GSY and MINT and some other Money Market ETFs. PVI gives you some tax free yield.

gaffer said:   You can look at GSY and MINT and some other Money Market ETFs. PVI gives you some tax free yield.

A 1% "high-yield" savings account has a higher yield than all three:

MINT
12-Mo. Yield 0.96%
SEC Yield 0.56%

GSY
12-Mo. Yield 0.87%

PVI
12-Mo. Yield 0.09%
SEC Yield 0.08%

Plus there are no trading costs, nor is there credit and liquidity risk.

if you can lock it away for a year, then you can get a 12 month cd at 1.05%..25K min . maybe 25K on cd and another 25K on RCA.

GE Capital Retail Bank

1.05%
Tue May 28

$25,000 min

robby69 said:   Choose the best rate you qualify to open HERE
Its the "only" choice you have to avoid "risk" as you stated, unless you want to jump thru the hoops of the higher yield savings account requirements.

Ah, I was going to suggest (multiple) rewards checking accounts or chasing opening account bonuses, but if high-yield savings accounts are already "jumping through hoops," then probably not worth it...

You can use the EDIE calculator to check on which types of accounts at which banks and for which amounts are FDIC insured. Do your homework and choose an online savings account that works for you.

another one to consider tdameritrade for 3 months for .85%

mooingmooseman said:   how much money are you considering here... 1% of 50k for 12 months is $500, this is not something worth thinking too hard about.

here's another fun idea though: put it all into real estate tracking fund. real estate increases, you gain, real estate decreases the house you were going to buy costs less now. this effectively hedges your capital for a real estate purchase.

when you say risk you actually haven't specified which risk you are trying to avoid. however, this strategy is actually specifically meant to eliminate all risk from your proposed transaction. the only question would be how good of a fund can you find compared to your local real estate market.


I had 50k to park for a short time. Looked around for better than 1% without much success. A couple of 1.1% offers, but strings attached or complications. Plus interest is taxed at income rate. Wound up transferring it to existing ING Direct, now Capital One, CHECKING account. The savings interest rate is 0.75% and for larger amounts, checking is actually a tiny bit higher at 0.80%. Not worth the trouble to open a new account for the fraction percent improvement, and just a few months of interest.

Theoretically, hedging with real estate fund is an interesting concept, but practically speaking, much of real estate is local, and finding an appropriate tracking fund to what you want to hedge for is nearly impossible.

Best hedge is just to buy what you want now.

stanolshefski said:   gaffer said:   You can look at GSY and MINT and some other Money Market ETFs. PVI gives you some tax free yield.

A 1% "high-yield" savings account has a higher yield than all three:

Plus there are no trading costs, nor is there credit and liquidity risk.

All true, but since OP asked for Money Market ETFs, it wouldn't hurt to provide him with some info on that front.
There is some price appreciation that may bump up the returns with those ETFs though, in addition to yield.
If OP had a longer time frame to park, then the long term dividend and capital gains might be favorable for him too.

gaffer said:   stanolshefski said:   gaffer said:   You can look at GSY and MINT and some other Money Market ETFs. PVI gives you some tax free yield.

A 1% "high-yield" savings account has a higher yield than all three:

Plus there are no trading costs, nor is there credit and liquidity risk.

All true, but since OP asked for Money Market ETFs, it wouldn't hurt to provide him with some info on that front.
There is some price appreciation that may bump up the returns with those ETFs though, in addition to yield.
If OP had a longer time frame to park, then the long term dividend and capital gains might be favorable for him too.


Bond yields are at or near all-time lows. Where are these capital gains going to come from?

He's more likely to suffer a capital loss, than a capital gain.

stanolshefski said:   gaffer said:   stanolshefski said:   gaffer said:   You can look at GSY and MINT and some other Money Market ETFs. PVI gives you some tax free yield.

A 1% "high-yield" savings account has a higher yield than all three:

Plus there are no trading costs, nor is there credit and liquidity risk.

All true, but since OP asked for Money Market ETFs, it wouldn't hurt to provide him with some info on that front.
There is some price appreciation that may bump up the returns with those ETFs though, in addition to yield.
If OP had a longer time frame to park, then the long term dividend and capital gains might be favorable for him too.


Bond yields are at or near all-time lows. Where are these capital gains going to come from?

He's more likely to suffer a capital loss, than a capital gain.


Not saying he would definitely get capital gains, also not disputing what you are saying. I'm just giving out options not mentioned previously. OP did ask before on Money Market ETFs. Up to OP to decide which of the various 'deals' that everyone has contributed works best for his situation.

pooter03 said:   I know this is a dumb question, but is there any sort of ETF that is extremely low risk? I know you can't eliminate all risk, but I'm just trying to see if I have any available options over 1%.
I like this one: https://personal.vanguard.com/us/funds/snapshot?FundId=0027&Fund...

Did you read news? There was a gonvernment in Europe just charge 10+% tax of their so called FDIC insured bank savings.
This means if you have 50K in the bank, the gonvernement wants 5k of it.
You might as well buy SP500 ETF. The gonvernment can not touch it until you cash it in CASH which is printed by the gonvernment in FULL faith.
SPY has about 2% dividend yield, but you may get capital gain or loss when you cash it.
Be aware, it take 3 business days to close the deal and some times for the brokers to wire the cash, if you are in a rush for the money.(read the fine print or ask them to inform self how many days brokers/banks hold your cash.)

www.geinterestplus.com

Write checks or make deposits like a money market account.
1.1% for 50k. Very convenient and safe, GE isn't going bankrupt overnight.

Greater return = greater risk
More safety = less risk

There's no way of getting around this.

If you are not planning on using your money for >1 year, you can invest in I-Bonds (backed by the US government). 1 year is the minimum that they will service this bond, and will go up to 30 years. You lose the last 3 months of interest if you take your money out prior to hitting the 5 year mark.

2 rates are offered with this bond: Fixed rate, which is currently 0.00% and Composite rate, which is currently 1.18%.

You can contribute up to $10k/year.

This will keep you from losing money against inflation. Definitely not meant for everybody, but it is relatively safe. Many people use these bonds as a place to hold emergency funds that would otherwise enjoy scant earnings in a low yield savings account.

As far as where to keep the rest of the money, my initial comment stands. While there are some decent APY's offered at some financial institutions, you do have to be willing to put forth some effort.

If you want a safe investment that you can be lazy with, enjoy the .65% APY.

Thanks to all for the replies. The main problem is that I'm not sure when I'll need the money. The timeline is 1 year, but if we see a house we love this summer, then it may be a few months. So, CDs are out of the question.
I'll probably go with one of the 1% savings accounts for the time being. Man, I miss when I had 5% checking in the mid 2000s
On the other hand, I just put in a lot of research to try to squeeze out a few hundred extra dollars. Probably not the most productive use of my time.

You might as well buy SP500 ETF. The gonvernment can not touch it until you cash it in

Famous last words

b16899 said:   Did you read news? There was a gonvernment in Europe just charge 10+% tax of their so called FDIC insured bank savings.

FDIC only insures US banks, so I doubt any banks in Europe were "called FDIC insured bank savings."

This means if you have 50K in the bank, the gonvernement wants 5k of it.

Where did this happen, b16899? Even in Cyprus, the special tax was only on balance amounts over 100,000.



You might as well buy SP500 ETF. The gonvernment can not touch it until you cash it in CASH which is printed by the gonvernment in FULL faith.

Sure.



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