Ultra Short Term Bond Fund vs Money market

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
renegade06
Posts: 195
Joined: Sat Jan 12, 2019 3:00 pm

Ultra Short Term Bond Fund vs Money market

Post by renegade06 » Wed Mar 25, 2020 8:58 pm

I am planning to keep money that I will need for taxes in July. Instead of the Vanguard money market fund, what do you think about the Vanguard Ultra Short Term Bond Fund (VUSFX)? I read an article today talking about how short term treasuries are negative... so would I get negative yield from VUSFX? I’m also wondering if this fund would be appropriate for half of an emergency fund or whether it’s just best to keep it in the Vanguard Money market.

Thanks, and I hope that you and your families are safe during these crazy times.
Last edited by renegade06 on Wed Mar 25, 2020 9:03 pm, edited 1 time in total.

User avatar
abuss368
Posts: 18731
Joined: Mon Aug 03, 2009 2:33 pm
Location: Where the water is warm, the drinks are cold, and I don't know the names of the players!
Contact:

Re: Ultra Short Term Bond Fund vs Money market

Post by abuss368 » Wed Mar 25, 2020 9:00 pm

renegade06 wrote:
Wed Mar 25, 2020 8:58 pm
I am planning to keep money that I will need for taxes in July. Instead of the Vanguard money market fund, what do you think about the Vanguard Ultra Short Term Bond Fund (VUSFX)? I read an articulate today talking about how short term treasuries are negative... so would I get negative yield from VUSFX? I’m also wondering if this fund would be appropriate for half of an emergency fund or whether it’s just best to keep it in the Vanguard Money market.

Thanks, and I hope that you and your families are safe during these crazy times.
It's fine but remember any transactions will need to be reported on Schedule D and Form 8949 for gains and losses. Money Market funds are not reported for gain and loss purposes as a share maintains a NAV of $1. Only dividend income is reported on Schedule B.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success." || Buy Total Stock until it hurts. Then find a way to buy even more!

Topic Author
renegade06
Posts: 195
Joined: Sat Jan 12, 2019 3:00 pm

Re: Ultra Short Term Bond Fund vs Money market

Post by renegade06 » Thu Mar 26, 2020 7:13 am

Thanks for your input, abuss

yohac
Posts: 276
Joined: Sat Sep 01, 2018 1:42 pm

Re: Ultra Short Term Bond Fund vs Money market

Post by yohac » Thu Mar 26, 2020 7:20 am

The NAV on Ultra Short Term Bond has dropped 1.5% in the last two weeks, so I wouldn't call it a MM replacement. But for an emergency fund it's probably fine.

3funder
Posts: 1245
Joined: Sun Oct 15, 2017 9:35 pm

Re: Ultra Short Term Bond Fund vs Money market

Post by 3funder » Thu Mar 26, 2020 7:52 am

I suppose if you need the money in July, a money market fund would be preferable. Both are fine, though.

Post Reply