Where to Park Cash For Now?

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Potential Buyer_IHB

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<p>Despite my blog name, I ain't buying in this market and thus need a place to park my equity/cash for a future home purchase. I'm looking for a very safe investment; I'm in a high tax bracket; and I'm worried about a potential bite from the Alternative Min Tax. Fidelity Investments has a muni fund that is fed & state tax free, AND Alternative Min Tax free (i.e., earnings not included in the calc of the AMT, I presume). It returns a tad over 3% annually, totally tax free, so that ain't bad. But do you know of any comparably safe and liquid investment vehicle, that yields significantly (meaningfully) better net returns? Also, I realize giving up some liquidity should give me higher returns, such as using CDs. But I analyzed CDs over the past year, and the net yield was roughly the same as the tax free muni fund, with a lot more hassle of dealing with finding/buying/selling CDs. </p>

<p>Thanks in advance for any advice. </p>
 
You'd mentioned Fidelity. If you type in CD in the search engine. It gives you all the CD's available. The process of buying CDs takes about 3 clicks.
 
One thing good about CD is that they're liquid. . . 3-6 months and you can take them out. . .with bonds you're locked in for a much longer period of time.
 
<p>HSBC: I'm not sure 5.05% fully taxable is meaningfully better than 3.3$ totally tax free, assuming the highest tax rate.</p>

<p>Reason: With the Fidelity muni fund, you invest in it and forget it. And it's completely liquid. CDs are not completely liquid, and you're right shopping for them is not difficult, but not having to shop for them and trade them at all, is nice.</p>

<p>IrvineCommuter: The Fidelity muni fund I am referring to is like a money market fund and is much more liquid than a CD. </p>

<p>Thanks for all the feedback!</p>
 
<p>potentinal buyer,</p>

<p>Oh, I see. How safe are those muni funds? I have looked at those before and with some out of state. So I wasn't sure in putting my money in them. </p>
 
<p>potential b,</p>

<p>I have been considering CDs but since you mentioned muni with no taxes. Essentially, a 3% muni w/out taxes is better than a CD with 5% return? Now, I know CDs have maturity date where the returns is paid out. As to muni, is that paid out monthly? Learning.</p>
 
Reason, check out Fidelity.com. It's: FSPXX FIDELITY CA AMT TAX-FREE MONEY MKT. I'm not an investment expert, but I think this is very safe (which is why the return is so ho-hum, i.e., in-line with good CDs and good savings accounts). I love the totally tax free aspect . . . and the invest and forget aspect.
 
Before you get all excited that FDIC insured means you will get your money back if the bank collapses, you may want to read up on exactly what the FDIC is and where it gets it's funding, and how much it has in reserves.
 
<p>awgee,</p>

<p>=) Glad I found one person who knows that FDIC is just a word of confident. Sort of like, "In God We Trust". It's hard for most to believe this. But FDIC will not be able to pay "all" depositors should they "all" want to withdraw their money at the same time. </p>

<p> </p>
 
hahaha!! ..but the safe is where the burglar looks for first. Hahaha.....ok if it's fire we're worry about. I know another place. How about the freezer ?....
 
<p>Great!....I sold all my mutual funds yesterday and about to transfer the proceeds into a money market fund. Now on CNBC, they're saying maybe the money market fund(s) are not safe either. WTF. </p>

<p>I am telling you. The mattress is the safest haven now. Hahaha....</p>

<p> </p>
 
<p>Farmers & Merchants short term CDs</p>

<p>short term treasuries (three months or less)</p>

<p>and get ready to buy gold and silver.</p>
 
<p>reason, </p>

<p>The freezer won't work. The FBI found $90,000 in Rep. Jefferson's freezer as part of a bribery probe.</p>
 
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