Buying Prime Money Market Funds RRS feed

  • General discussion

  • When you intend to buy a new money market fund, create the security in Money first rather than during the first transaction download.

    I just imported the Buy transaction via PocketSense, and somehow it became a mutual fund. Was I inattentive? Maybe. Anyway, I think I tried all of the tricks to convert this from a MF to a MMF in Money, and I failed. It's not terrible to have an MMF as an MF, but I wish I had created the MMF security first.

    So what led up to explicitly buying a money market fund anyway? After all, there is usally a sweep fund where the broker buys and sells automatically with any free cash and liquidates when you buy something. The following applies even to those who do not download transactions.  The deal is that brokers often have a higher-paying money market fund available. What is nice about them is they will also be liquidated automatically when you buy something or write a check. You have to buy explicitly, however. When doing the Buy, it is safer to enter the transaction as an exchange from your sweep fund. Usually you are just fine doing a Buy.

    FDRXX US Government cash reserves (can be sweep for IRA)
    SPRXX initial buy $500+
    FZDXX initial buy $100000+

    SWVXX Schwab Value Advantage MMF

    VMMXX   Vanguard Prime Money Market Investor

    There are more. In additition, there are state-specific municipal money market funds that are worth looking into for some. Some of the state funds have separate versions that avoid AMT.

    Friday, September 14, 2018 3:06 PM