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What to do with too much cash?
#11
I like Mikes CD idea much better than a bond you may cash.  Multiple CDs even better.  You could still leave a CD alone and suffer no interest penalty if you truly needed to cash one out.  Accepting a 5% loss on an early bond sale that doesn't even yield that much in the first place does not pass my risk/reward requirements.  It makes staying in cash for minimal yield look pretty good IMO.  

Offtopic but my new broker is Vanguard.  They are pretty famous for low fees and small investor friendly.  I don't think they have even one bond fund that isn't upside down for the past few years.  It's not like they are incompetent.  Bonds are just that horrible in this rising rate market that pretty much bounced from free credit.  Vanguard suggests I invest 40% of my port in bonds due to my age.  I don't think so anytime soon.  Think I'd rather just ask Mike where the good US CD rates are and call it a day.  Smile
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#12
I can't seem to open the CD link.
Just out of interest, what sort of yields are they offering for a 1 year CD?

As I said, the ones I can buy from IB are around 2.9%. And I'm pretty much limited to that as opening a bank account (or anything similar) in the USA would be too much of a hassle.
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#13
2.6% for 19 months.  $1000 minimum.  And it is a US bank.
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#14
Sorry for the late reply but....

Short Term CD ladder (3, 6, 9, 12 month duration)(Yield 2.10, 2.25, 2.40, 2.55 as of today)

Or ETF's:

BIL
USFR
VGSH
There are people who use up their entire lives making money so they can enjoy the lives they have entirely used up
Frederick Buechner
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#15
What about several CD's that come due in different increments? If I had a large pile of cash waiting to be deployed for a home purchase that's what I'd do with it.
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#16
That's what RobandCindy is suggesting when he said "ladder". Until we get closer to the end of FED increases it would be a little crazy to do it any other way with a substantial amount of cash. Seems to me there is a real good chance a quality CD will pay a full point higher in about a year, of very nearly so.
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#17
oops lol....I was using my phone and somehow missed the CD advice!
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#18
Well, here is where I am at.
The cash that I currently have, at least the large majority of it, stays put. Simply because I couldn't find any decent currency hedges and I don't want to be over exposed to the currency risk.

As for the monthly cash deposit that was previously going to this cash account, I made a plan to throw it into T-bills, CDs or corporate bonds. Whatever feels like the right move at the time of buying. One purchase every 3 months with a maturity of 1 year. So looks like October/January/April/July for both purchases and maturity dates.

This way I get an acceptable interest rate and the money will start to become available at regular intervals after 1 year. Funnily enough, the first set of T-bills will hit maturity around the same time as my current employment contract ends... and surprisingly the amount that I'm putting into these on a monthly basis is roughly the same amount that I imagine needing to live for a month. A massive coincidence or is somebody possibly planning on taking a year off? :p
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#19
Sounds like a mini-retirement. Good for you if you can finance it properly. I did that for 3 years bit it ends real soon. Hopefully Home Depot is hiring Smile
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