Charles Schwab Money Market Funds

Charles Schwab Money Market fund question?

Prime money fund has a return of 1.72% on SWVXX (the investor shares). I know this is historical and subject to change, however does this seem to good to be true or is it safe to put a portion of savings into this account rather then let it sit?

https://imgur.com/a/1iXj2kO

Edit: thanks for all the replies. I was trying make sure my thoughts for this short term saving growth we're not off. I'm very new to this. starting my resiidencyand using this money for a house purchase in the next 9 months

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level 1

There are guaranteed safety vehicles like CD that offer 2+ % for 1 year period. So if you are looking for safety, find a FDIC bank that offers CDs with good rates.

level 1

"Prime" money market funds like SWVXX are not FDIC insured, but they are very safe. The fund is a good choice for your short-term savings.

Note that you purchase and sell it like a mutual fund, so it takes 1 day to get your money out.

level 1

I've used VMMXX as an emergency fund - they're considered safe, but less safe than money in an FDIC savings account or a CD. In 2008 there was a run on the money markets after one fund broke the buck and lost value.

level 1

Very safe. The interest rate is subject to change, but there is an extremely low risk of losing any money you invest. In theory it is possible, but a company like Schwab is very unlikely to manage a money market fund in a way that would result in a loss. This type of fund invests in bonds of highly rated companies and also in US government bonds with very short maturity dates.

level 1

This investment is very safe. One of the safest out there.

level 1

I also use Schwab and buy SWVXX for short term savings.

For longer term money I want to keep safe, I use 6 month Treasury bills, which you can also by from schwab. You get about 2 percent and can liquidate before they are due if you want. Treasury bills are backed by the full faith and credit of the US govt and so it is just as good as FDIC insured accounts.