I like to revisit my past financial thinking and decisions a year plus later. I have been buying more TIPS in the bond portion of my asset allocation during the last year and have moved to solely the 10 year duration purchased at auction. I have not recently bought new nominal bonds as the old ones mature and have been letting those proceeds either sit in my settlement fund or buying TIPS.
First, my brokerage settlement accounts are in VMFXX at Vanguard. As of this past Friday the VMFXX 7 day annualized net yield was 4.20% (after the 0.11 expense ratio) which I consider a good yield considering the fund is almost all risk free short term UST notes.
Second, are personal financial issues as my wife has had major health issues recently and I want the financial flexibility to meet potential unexpected uninsured medical expenses and as I am foregoing current part time work to be her full time caregiver I want a stronger cash position in addition to my available emergency reserves and a unused line of credit.
In a followup article on Tipswatch posted today, 6/30/2024, David Enna makes what I think is a good argument, with strong references, that his analysis is that now is a good time to consider TIPS or I Bonds.
I like to revisit my past financial thinking and decisions a year plus later. I have been buying more TIPS in the bond portion of my asset allocation during the last year and have moved to solely the 10 year duration purchased at auction. I have not recently bought new nominal bonds as the old ones mature and have been letting those proceeds either sit in my settlement fund or buying TIPS.
Hey Bill, Why settlement funds vs transferring to a money market fund? My understanding is most settlement funds pay next to nothing in interest.
Good question David, I have two reasons.
First, my brokerage settlement accounts are in VMFXX at Vanguard. As of this past Friday the VMFXX 7 day annualized net yield was 4.20% (after the 0.11 expense ratio) which I consider a good yield considering the fund is almost all risk free short term UST notes.
Second, are personal financial issues as my wife has had major health issues recently and I want the financial flexibility to meet potential unexpected uninsured medical expenses and as I am foregoing current part time work to be her full time caregiver I want a stronger cash position in addition to my available emergency reserves and a unused line of credit.
Oh, so it is in a money market account. Sorry to hear about your wife’s health issues.
In a followup article on Tipswatch posted today, 6/30/2024, David Enna makes what I think is a good argument, with strong references, that his analysis is that now is a good time to consider TIPS or I Bonds.
https://tipswatch.com/2024/06/30/debate-aftermath-barlclays-says-buy-inflation-protection/