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If you need the dough in 2 months there is almost nothing better than a money market account.
I have used Vanguard Total Bond Market Index as my parking place for money.
It is sitting in a money market account earning zero. I am wondering is there a low-risk parking place with a modest return?
Sure.
You can put it in bank/credit union high yield checking accounts which have some strings attached but pay less unreasonable (still negative in real terms after you subtract income tax) interest rates. Bank accounts are FDIC insured; Credit union accounts are covered under NCUSIF. At least some allow married couples to each have accounts on which the other spouse can be a joint owner.
For instance, my wife and I have a pair of checking accounts which pay about 2.3% on the first $25,000 provided that you have a monthly direct deposit of your paycheck or ACH transfer from another bank (we use that option) and make 10 check card transactions a month.
That's $95 over 2 months which is over triple an on-line money market account paying 0.7% which would only return $29 before taxes.
or should I just leave it as it is?
It depends what your time and the principle of letting banks profit less from your money are worth to you. I'd do it for the principle of it.
A modest return for two months? Even if you found a checking account paying 6% that was government insured (and you won't), then that 2 months would yield $250 pre tax. After taxes, more likely $200.
If such a thing existed, setting up the account on-line and faxing to verify ID would pay over $1000 per hour pre-tax and be entirely worthwhile.
Depends on how much risk you are willing to take. Nothing out there will make you any money in 2 month when it comes to standard investment vehicles.
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Where would you 'park' 50k for 2 months?
It is sitting in a money market account earning zero. I am wondering is there a low-risk parking place with a modest return?
or should I just leave it as it is?
#investing