100k to invest for MF, best short term yield?

Question

Omar Khan · Answer

@Richard Lovering I wholeheartedly agree with @Joel Owens. For such low duration, it is not worth your time chasing 1-2%. E.g. on $100K, 2 months of interest at 1% is $166.67 or @ 2% is $333. Honestly, not worth the time, hassle and loss of brain cells.

Joel Owens · Answer

If you need to keep it liquid month to month I do not know of anything much worthwhile. Most sponsors/syndicators will want a longer term commitment. Shortest I have seen is about 2 years or so on a smaller project turn around.

Most stuff that is 1 to 2% I do not even bother with.

It's kind of like coupons and clubs. If I have to do 10 steps and sign up for this and that and keep another password just to save a few bucks it's not worth my time. If the savings is easily there to use then I use it.

Once income goes up to so much per hour squeezing out a few percent here or there or using laborious coupons to try and get savings is a time loser for me.

Brian Garrett · Answer

American Express High Yield Savings earning 1.9% interest.

Henri Meli · Answer

What does Short term mean? 1 month? 1 year? 5 years? or anything in between?

How much risk can you take? .Banks would love that money.

Jeff Kehl · Answer

@Richard Lovering I would disagree with some of the prior advice. People that tell you it doesn't matter are probably people that don't carry a lot of short-term cash. You can keep your 'reserves' as credit lines but most of those can be pulled at any time so it is a good idea to keep a lot of that liquid.

And more to the point of your question, if you're holding a large amount of funds liquid for awhile in anticipation of investing it where to keep it?

Yes, if it's just $100k and you're talking 1% or $1000 why waste the brain cells?

But what if its $500k or $5 million? I guarantee you that is worth worrying about. If you look at companies carrying a lot of cash on their balance sheet, there are people in the finance department that have that as their only job. So, yes, worry about it.

Where to put it? Money Market Accounts, Online savings accounts, CDs, Treasury Bills, Municipal Bonds, Short-term Corporate Bonds. All depending on your risk tolerance.

Joel Florek · Answer

@Richard Lovering In my portfolio I use a line of credit against a property. For a while, I had some extra cash laying around not working for me. Ultimately I completely paid off a deal and put a line of credit against the property. Now I have a big credit card laying around that I can use when I need it and will only pay 6%(not much more than commercial loans). Then I can take new cash savings and pay it down as quickly as possible. Fees are only $150 a year to maintain the line with my bank.

Michael Dang · Answer

Synchrony Bank HYS account 2.05% APY. Check bankrate.com for other options.

Lennon Lee · Answer

So you mean where do you keep the funds while you find the deal?

100k to invest for MF, best short term yield?

100k to invest for MF, best short term yield?

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