🇺🇸Presented By: Seeking Alpha's Labor Day Special!🇺🇸

The $10K Cash Conundrum

After recently selling 157 Toronto-Dominion Bank (TD) shares, I now have $10,000 in cash in my Self-Directed IRA account. So, what's next?

The Problem

I don't see any screaming stock buys, and the Schwab default money market fund for cash only pays a minuscule 0.45% APY. That's barely better than stuffing it under my mattress!

I need to do something more intelligent with this cash, but what?

Enter SWVXX

A newsletter reader suggested SWVXX, the ticker symbol for the Schwab Value Advantage Money Fund.

It's a money market fund that aims to keep its price steady at $1 per share. Think of it as a slightly fancier piggy bank.

Why SWVXX Caught My Eye

Three things grabbed my attention about SWVXX. First, it offers a higher interest rate than my current money market fund. Every little bit helps, right?

Second, I can quickly access my cash if I spot an investment opportunity.

Third, it feels safer than dumping everything into stocks when everything seems pricey.

The Potential Downsides

There are a few things to watch out for with SWVXX.

The biggest worry is inflation. If prices start climbing faster than the interest I'm earning, my money might not stretch as far in the future.

If I leave my cash parked here too long, I could miss out on higher returns elsewhere.

While SWVXX tries hard to stay at $1 per share, it's not guaranteed.

There's also a tiny (and I mean tiny) chance I could lose some money.

The Bottom Line

After weighing the pros and cons, SWVXX is a decent temporary parking spot for my TD cash.

So, as of this writing, I moved $4,000 into SWVXX and should receive a distribution of $17.48, an annualized yield of 5.24%.

Remember, the yield will also fall when interest rate cuts start, so this really is a pit stop.

It won't make me rich overnight, but it should earn more interest while I figure out my next move.

Plus, I can sleep a little easier knowing my money isn't just collecting dust.

Remember

Whether you're dealing with $100 or $10,000 like me, it's important to think about what you want your money to do for you in the long run.

SWVXX might be a good pit stop, but it is probably not where you want to park your cash forever.

Your Turn

Have you used SWVXX or similar money market funds? How do you handle unexpected cash windfalls? Hit REPLY and let me know your thoughts!

😁THANK YOU to everyone who responded to the last newsletter!!

Check out the portfolios and podcasts, or see what’s cooking on YouTube.

And now, here is this week's portfolio activity...

Dividends Received ~$44.46

Dividends Received Year to Date~

Starbucks (SBUX) | $44.46

Dividends Received Year to Date~

$4,831.12

Dividends year tom date — Source: Charles Schwab

Stocks Bought (AVERAGE)

4,000 Schwab Value Advantage Money Fund (SWVXX) | $1.00
75 Enterprise Products Partners (EPD) | $29.21
1 Dollar General (DG) 10/18/24 $100.00 Call Option | $80 (Yes, this is gambling, but we could see a bounce to near $100 in the next 2-4 weeks!)

Notable Ex-Dividends This Week + SSD Score

9/3 M&T bank (MTB), 3.14% | 99VS
9/3 McDonald's (MCD), 2.31% | 77S
9/3 Nike (NKE), 1.78% | 99VS
9/3 Realty Income (O), 5.08% | 80S
9/4 Old Dominion Freight (ODFL), 0.54% | 81VS
9/6 Canadian National (CNI), 2.08% | 97VS
9/6 Kimberly-Clark (KMB), 3.37% | 88VS
9/6 PepsiCo (PEP), 3.14% | 93VS

🎙️Podcast of the week🎙️

Fascinating We Study Billionaires episode covering investment checklists from the book The Investment Checklist: The Art of In-Depth Research. I got quite a bit out of this, and it was an enjoyable listen.

The Investment Checklist by Michael Shearn

🎦If you missed it, Jeremy from DividendStockPile.com joined us to discuss our BEST dividend stocks for beginners.

Investing Newsletters You Might Like

⭐Ryne Williams writes a free weekly dividend newsletter and creates multiple top-notch YouTube videos every week.

🤑Rick Stambaugh from Orange Mountain Financial brings you ‘Grow Retirement Income.' He’s a seasoned pro with over 30 years in trading and a passion for guiding folks to a prosperous retirement.

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Three Bad Jacks - Gone Gone Goodbye